Wells Fargo increases profit surprisingly strongly – Less fear for loans. In the fourth quarter, the money house earned 5.75 billion US dollars (around 5.0 billion euros) and thus 86 percent more than a year earlier, as announced on Friday in San Francisco. For the year as a whole, there is a surplus of more than 21.5 billion dollars after the bank had earned just 3.4 billion in the first Corona year 2020. This time it also performed significantly better than expected by analysts on average.
As with many other banks, the jump in profit was mainly due to the provisions for impending loan defaults. Because of the crisis in 2020, Wells Fargo put a total of 14.1 billion dollars into so-called risk provisioning. A year later, the institute was able to withdraw almost $4.2 billion from the pot because the economic situation and thus the loan defaults did not develop as dramatically as feared at the beginning of the pandemic. This increased profits significantly.
While Wells Fargo’s net interest income fell sharply for the full year, other income, such as fees and commissions, rose. In the fourth quarter, total revenues exceeded the average expectations of industry experts, and for the full year they rose almost 6 percent to $78.5 billion.
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