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Wells Fargo reported worse than expected Q1 earnings before the bell Tuesday. $WFC reported along with JPMorgan $JPM&. The bank was hit by ramifications from COVID-19  with a$3.1 billion reserve build and a $950 million impairment of securities

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Wells Fargo & Co NYSE: WFC Reported Earnings Before Open Tuesday

$0.01 Missed $0.61 EPS And $17.70 Bil Missed $19.32 Billion Forecast in Revenue 

Earnings

Wells Fargo announced on Tuesday EPS of 1 cent on revenue of $17.7 billion as a $3.1 billion loss reserve build accounted for 56 cents per share and a $950 million impairment of securities accounted for 17 cents a share. Wall Street had expected Wells Fargo earnings per share to drop 49% to 61 cents. Revenue was seen down 11% to $19.32 billion.

Last  October Wells Fargo had announced the appointment of Charles W. Scharf as the new Chief Executive Officer and President, effective October 21. Scharf was previously Chairman and CEO at Bank of New York Mellon.

Wells Fargo & Co NYSE: WFC

Market Reaction Lunchtime $30.07 −$1.36 (-4.33%)

Highlights

  • Net interest income fell 8% to $11.3 billion.
  • Average loans were up 2% to $965 billion,
  • Average deposits were up 6% to $1.3 trillion.
  • Wells Fargo reported a capital ratio of 10.7%.

Wells Fargo and JPMorgan are among the nearly 4,600 lenders participating in the Paycheck Protection Program. The SBA said that as of 3 p.m. on Monday, more than 941,000 loan applications had been approved, amounting to $228 billion of the $350 billion available.

Wells Fargo Q1 2020 Earnings

Wells Fargo is still trying to recover from the fake account scandal surrounding its sales practices, in which employees in its consumer banking division created fake accounts amid a high-pressure sales environment. More issues surrounding the bank's practices continue to surface. The Fed in February last year barred the bank from growing until it "sufficiently improves its governance and controls."

Source: WFC, AlphaStreet

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