Wells Fargo & Co has today reported a bigger-than-expected drop in quarterly profit, as lending activity slowed and it recorded higher expenses.
Net income applicable to common stock fell to $4.79 billion, or 98 cents per share, in the quarter ended June 30, from $5.45 billion, or $1.08 per share a year ago.
On an adjusted basis, the company's earnings were $1.08 per share, excluding a 10-cent hit from an income tax expense, missing analysts' estimates of $1.12 per share, according to Thomson Reuters.
The bank said its total revenue fell 3.1% to $21.55 billion, with community banking - the area most closely tied to the 2016 sales practices scandal - posting a 1.25% dip in revenue.
Loan growth slowed across the board in the quarter, as rising interest rates discouraged borrowers. The Federal Reserve has increased interest rates twice this year.
Well Fargo said its total interest expense rose 56% to $3.47 billion, while non-interest expense rose 3% to $13.98 billion.
Average loans fell 1.3% to $944.1 billion.
Peer JPMorgan Chase reported an 18.3% rise in quarterly profit today, while Citigroup's profit rose 16% on lower taxes and higher fee income.
