Wells Fargo & Co announced its quarterly report on Tuesday which fell short to the expectation of the analysts, facing decline in revenue generation by all of its banking units with consumer banking on lower side as it was the center point of bank’s 2016 sales scandal.
In early trading on Tuesday, Wells Fargo’s share saw a fall of 1.22 percent which brought the share price dropped to $48.42.
In the fourth quarter, to the average analyst revenue expectations of $21.73 billion, bank generated 5 percent less revenue of $20.98 billion, according to IBES data from Refinitiv.
Making good on its promise to lower the costs to fight expenses linked with its sales scandal, Wells managed to reduce 21 percent in its noninterest expenses to an amount of $13.34 billion.
In 2016, revelation of a sales scandal regarding opening of over 3.5 million fake accounts by the employees without customer’s approval and emergence of that in other departments of the bank including wholesale, wealth-management and consumer lending, has surged the expenses of Wells Fargo over the past two years.
Though the full year expenses saw decline of 4 percent and remained $56.13 billion, but these jumped up from the last year set target of $54.5 billion by the bank.
John Shrewsberry, Wells Fargo’s Chief Financial Officer, described the bank on track to meet and beat the expense target set for 2019.
For the fourth quarter ended December 31, Wells Fargo saw a decline in its net income which dropped to $5.71 billion from a year ago income of $5.74 billion or $1.21 per share from a year ago earnings of $1.16 per share which beat the average analyst estimate of $1.19 per share, according IBES data from Refinitiv.
The year-ago quarter came with a one-time boost of $3.35 billion resulted from a U.S. corporate tax overhaul by President Donald Trump.