AP Business Writer
Wells Fargo’s net income tumbled in the fourth quarter, weighed down by hefty costs and a lower interest rate environment.
The San Francisco-based bank earned $2.87 billion, or 60 cents per share, for the period ended Dec. 31. A year earlier it earned $6.06 billion, or $1.21 per share.
The current quarter’s results included 33 cents per share of litigation accruals.
Analysts polled by FactSet predicted a profit of $1.12 per share.
Wells is still under growth restrictions by regulators after years of missteps, beginning in 2016 with the uncovering of millions of fake checking accounts its employees opened to meet sales quotas. In 2018 the Federal Reserve capped the size of Wells Fargo’s assets. The Fed hasn’t said when it will lift the restrictions on the bank.
Last year Wells Fargo & Co. named its third CEO in as many years as it attempted to move on from its scandals. Charles Scharf, CEO of the Bank of New York Mellon, took over for C. Allen Parker, who had led the company since March.
“Wells Fargo is a wonderful and important franchise that has made some serious mistakes, and my mandate is to make the fundamental changes necessary to regain the full trust and respect of all stakeholders,” Scharf said in a statement on Tuesday.
Net interest income declined from the third quarter to $11.2 billion, mostly hurt by lower interest rates.
The biggest U.S. mortgage lender’s revenue dropped 8% to $19.9 billion. Wall Street expected $20.12 billion.
Shares fell 3.2% in morning trading.