Wells Fargo’s earnings reports came in in-line with Capital IQ Consensus at $1.01, and its revenues rose 4% annually.
Revenues rose to $22.16, slightly higher than the Capital IQ Consensus of $22.09 billion.
Net interest income in the second quarter also increased to $66 million, up from the first quarter’s $11.7 billion. This is primary driven by loan growth, including the full quarter benefit to the assets acquired from GE Capital that closed late in the first quarter.
“Wells Fargo's second quarter results demonstrated our ability to generate consistent performance during periods of economic, capital markets and interest rate uncertainty,” said John Stumpf, Wells Fargo chairman and CEO. “Compared with a year ago, we had solid growth in loans, deposits and customers, which are our fundamental drivers of long-term value.”
“We also improved our efficiency ratio while continuing to reinvest in the franchise,” Stumpf said. “We returned more capital to our shareholders in the quarter and were pleased to have received a non-objection to our 2016 Capital Plan from the Federal Reserve. We remain well positioned to continue to meet the financial needs of our customers.”
The net interest margin was down four basis points from the first quarter to 2.86%.
Loans totaled $957.2 billion on June 30, 2016, up by $9.9 billion or 1% from March 31, 2016. Residential loan originations were $63 billion in the second quarter.
The production margin on residential held-for-sale mortgage loan originations decrease to 1.66%, down from 1.68% in the first quarter.
On the other hand, shares of Wells Fargo retreated 0.8% in premarket action after the money center bank reported in-line results for the second quarter.