Wells Fargo & Co. (NYSE: WFC) issued fiscal fourth-quarter net income of $5.37 billion, or $1 per share, compared with $4.86 billion, or 91 cents per share, a year earlier. Wall Street had expected the bank to post earnings of 98 cents per share, according analysts polled by Reuters. Shares of Wells Fargo rose 0.09 percent to $45.60 in afternoon trading.
Jonathan Corpina, senior managing partner with Meridian Equity Partners Inc., weighed in on JPMorgan and Wells Fargo earnings on Tuesday and discussed what analysts are forecasting for Bank of America.
“So watching what the Fed does tapering, interest rate movements. Watching the 10-year, the 30-year,” said Corpina. “This is all going to affect their revenue and their stream. It’s all tied together with the housing market. Do main stream investors have enough money to go out and buy new homes? Can they get accepted for mortgages? The mortgage application has become a little bit strenuous at times, but what’s happening in Washington is clearly going to dictate Wells Fargo’s core profit center that’s there.”
Although Wells Fargo posted an 11 percent jump in quarterly profit, the bank said mortgage financing was at its slowest pace in nearly five years.
“Wells Fargo had another outstanding year in 2013, including strong growth in loans and deposits, and double-digit growth in earnings,” said Chairman and CEO John Stumpf. “In the five years since our merger with Wachovia, we have grown our businesses, invested in our franchise’s future and contributed to the U.S. economy’s recovery. Our 264,000 team members made it possible through their strong commitment to our consumer, small business and commercial customers, and the communities they serve around the world. Strong earnings power and capital levels, and an improving economic outlook are major reasons why we look ahead to 2014 with optimism.”
“The fourth quarter of 2013 was very strong for Wells Fargo, with record earnings, solid growth in loans, deposits and capital, and strong credit quality,” said Chief Financial Officer Tim Sloan. “We also grew both net interest income and noninterest income during the quarter, despite a challenging rate environment and the expected decline in mortgage originations. Wells Fargo’s diversified model was again able to produce solid results for our shareholders.”
JPMorgan Chase & Co. (NYSE: JPM) reported fiscal fourth-quarter net income of $5.28 billion, or $1.30 per share, compared with $5.69 billion, or $1.39 a share, a year ago. Excluding items, the company earned $1.40 per share, beating the analysts' average estimate of $1.35, according to Reuters.
"We are pleased to have made progress on our control, regulatory and litigation agendas and to have put some significant issues behind us this quarter,” said Jamie Dimon, Chairman and Chief Executive Officer. “We reached several important resolutions - Global RMBS, Gibbs & Bruns, and Madoff. It was in the best interests of our company and shareholders for us to accept responsibility, resolve these issues and move forward. This will allow us to focus on what we are here for: serving our clients and communities around the world. We remained focused on building our four leading franchises, which all continued to deliver strong underlying performance, for the quarter and the year."
On Tuesday, shares of JPMorgan edged up 0.29 percent to $57.87 in afternoon trading.
On Wednesday, Bank of America Corp. (NYSE: BAC) is forecast to report fiscal fourth-quarter earnings of 27 cents per share on revenue of $21.28 billion, compared with a profit of 3 cents a share on revenue of $21.66 billion in the year-ago period. On Tuesday, Bank of America stock rose 1.56 percent to $16.69 ahead of the announcement.
