The wealth and investment management (WIM) division of Wells Fargo has reported net income of $677m for the third quarter of 2016, up 12% compared to $606m a year ago.
The unit’s total revenue for the quarter stood at $4.09bn, a rise of 6% from $3.88bn during the same quarter in 2015. The bank attributed the rise in revenue to higher deferred compensation plan investment results (offset in employee benefits expense) and higher net interest income, as average loans increased $7.3bn, or 12%, to $68.4bn.
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Noninterest expense at the unit increased 3% year-on-year to $2.99bn.
The WIM unit offers a range of personalised wealth management, investment and retirement products and services to clients across US-based businesses including Wells Fargo Advisors, The Private Bank, Abbot Downing, Wells Fargo Institutional Retirement and Trust, and Wells Fargo Asset Management.
Client assets at the wealth management unit of the bank at the end of 30 September 2016 were $230bn, a 5% rise from the previous year.
Asset under management (AuM) at Wells Fargo Asset Management were $498bn, an increase of 4% from the prior year.
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By GlobalDataOverall, the banking group reported net income of $5.64bn for the third quarter of 2016, down 2.7% from $5.80bn a year ago.
Wells Fargo CFO John Shrewsberry said: “Wells Fargo reported solid results for the third quarter, reflecting the benefits of our diversified business model, our strong balance sheet and improved credit performance. Revenue increased linked quarter on higher net interest income, driven by growth in earning assets and increased investment in our securities portfolio, as well as solid mortgage banking results.
“While expenses increased from second quarter, credit results improved from the prior period led by strong performance in consumer real estate and improvements in our oil and gas portfolio. Capital remained strong and our net payout ratio5 was 61 percent in the quarter, as we returned $3.2 billion to shareholders through common stock dividends and net share repurchases.”
