Wells Fargo today posted a $3.05 billion first-quarter profit, in line with its prior forecast, as a surge in mortgage banking as well as benefits from the purchase of Wachovia offset rising credit losses.
Excluding the payment of preferred stock dividends, net income for the fourth-largest US bank was $2.38 billion, or 56 cents per share, compared with a profit of $2 billion, or 60 cents, a year earlier. Wells Fargo's shares outstanding increased because of the Wachovia acquisition.
Revenue totalled $21.02 billion, above the $20 billion that Wells Fargo had forecast.
Analysts on average forecast profit of 55 cents per share on revenue of $19.91 billion, according to Reuters Estimates. The bank's largest shareholder is Warren Buffett's Berkshire Hathaway.
Wells Fargo returned to profit after losing money in the fourth quarter, its first loss in seven years.
Shares of the bank soared 32 per cent on April 9th after it issued preliminary results showing a profit more than double what analysts were at the time expecting.
The bank had booked significant losses when at the end of 2008 it paid $12.5 billion for Wachovia, which had been felled by mortgage losses at the former Golden West Financial.
Shares of Wells Fargo closed yesterday at $18.81 on the New York Stock Exchange.