Wells Fargo & Company · NYSE:WFC
Wells Fargo & — Q2 2022 Earnings Presentation
19 slides from Wells Fargo &'s earnings presentation, Jul 15, 2022
Slide 1: 2Q22 Financial Results
2Q22 Financial Results July 15, 2022 © 2022 Wells Fargo Bank, N.A. All rights reserved.
Slide 2: 2Q22 results
2Q22 results • Net income of $3.1 billion, or $0.74 per diluted common share – Results included $(576) million impairment of equity securities ($(412) million, or $(0.08) per share, net of noncontrolling interests) predominantly in our affiliated venture capital business driven by market conditions
Slide 3: Capital
Capital 1 Common Equity Tier 1 Ratio under the Standardized Approach Capital Position 1 • Common Equity Tier 1 (CET1) ratio of 10.3% at June 30, 2022 remained above 2 12.1% our regulatory minimum and buffers of 9.1% 11.6% 11.4% • CET1 ratio down 180 bps from 2Q21 and down 20 bps from 1Q22 and 10.5%
Slide 4: 2Q22 earnings
2Q22 earnings $ in millions (mm), except per share data 2Q22 1Q22 2Q21 vs. 1Q22 vs. 2Q21 Net interest income $10,198 9,221 8,800 $977 1,398 Noninterest income 6,830 8,371 11,470 (1,541) (4,640) Total revenue 17,028 17,592 20,270 (564) (3,242) Net charge-offs 345 305 379 40 (34) Change in the allowan
Slide 5: Credit quality
Credit quality Provision for Credit Losses and Net Charge-offs ($ in millions) Allowance for Credit Losses for Loans ($ in millions) 379 423 16,391 305 345 257 14,705 580 6,821 13,788 0.19% 6,140 12,681 12,884 0.18% 0.15% 0.12% 0.14% 5,997 1.92% 5,533 5,802 (452) 1.70% (787) 1.54% 9,570 1.39% 1.37%
Slide 6: Loans and deposits
Loans and deposits Average Loans Outstanding ($ in billions) Average Deposits and Rates ($ in billions) 926.6 1,435.8 1,450.9 1,470.0 1,464.1 1,445.8 875.0 898.0 37.3 34.9 27.1 854.7 854.0 41.7 20.3 175.0 176.6 180.9 185.8 173.7 Corporate 389.1 189.4 182.1 169.2 164.9 Wealth and 379.5 381.9 190.8 37
Slide 7: Net interest income
Net interest income Net Interest Income ($ in millions) • Net interest income up $1.4 billion, or 16%, from 2Q21 primarily due to the impact of higher interest rates, higher loan balances, lower mortgage- 10,198 backed securities (MBS) premium amortization, and a decrease in long-term debt, partiall
Slide 8: Noninterest income
Noninterest income Noninterest Income ($ in millions) • Noninterest income down $4.6 billion, or 40%, from 2Q21 – Net gains (losses) from equity securities down $3.3 billion on lower results in our affiliated venture capital and private equity businesses driven by market 11,470 conditions and includ
Slide 9: Noninterest expense
Noninterest expense Noninterest Expense ($ in millions) • Noninterest expense down 3% from 2Q21 – Personnel expense down 4% predominantly reflecting divestitures, lower 13,870 revenue-related compensation, as well as the impact of efficiency initiatives 13,341 13,303 13,198 12,883 79 – Non-personnel
Slide 10: Consumer Banking and Lending
Consumer Banking and Lending Summary Financials • Total revenue down 2% YoY and down 1% from 1Q22 $ in millions (mm) 2Q22 vs. 1Q22 vs. 2Q21 – CSBB up 17% YoY primarily due to the impact of higher interest rates and higher deposit balances; up 9% from 1Q22 as higher deposit balances, higher Revenue b
Slide 11: Consumer Banking and Lending
Consumer Banking and Lending 1 Mortgage Loan Originations ($ in billions) Debit Card Point of Sale (POS) Volume and Transactions 53.2 51.9 122.0 122.4 125.2 118.6 115.0 48.1 16.3 16.7 15.3 37.9 2.3 55% 55% 34.1 2.5 2.5 2.5 2.5 13.8 14.5 59% 56% 36.9 28% 35.2 32.8 24.1 19.6 2Q21 3Q21 4Q21 1Q22 2Q22 2
Slide 12: Commercial Banking
Commercial Banking Summary Financials • Total revenue up 18% YoY and up 7% from 1Q22 $ in millions 2Q22 vs. 1Q22 vs. 2Q21 – Middle Market Banking revenue up 27% YoY and up 17% from 1Q22 due to the Revenue by line of business: impact of higher interest rates and higher loan balances Middle Market Ban
Slide 13: Corporate and Investment Banking
Corporate and Investment Banking Summary Financials • Total revenue up 7% YoY and up 3% from 1Q22 $ in millions 2Q22 vs. 1Q22 vs. 2Q21 Revenue by line of business: – Banking revenue up 4% YoY primarily driven by stronger treasury management results reflecting the impact of higher interest rates, as
Slide 14: Wealth and Investment Management
Wealth and Investment Management Summary Financials • Total revenue up 5% YoY $ in millions 2Q22 vs. 1Q22 vs. 2Q21 – Net interest income up 50% YoY and up 15% from 1Q22 predominantly driven Net interest income $916 $117 306 by the impact of higher interest rates Noninterest income 2,789 (169) (137)
Slide 15: Corporate
Corporate Summary Financials • Net interest income down YoY primarily due to higher deposit crediting rates $ in millions 2Q22 vs. 1Q22 vs. 2Q21 paid to the operating segments, unfavorable hedge ineffectiveness Net interest income ($619) $199 (315) accounting results, and the sale of our Corporate T
Slide 16: Appendix
Appendix
Slide 17: Tangible Common Equity
Tangible Common Equity Wells Fargo & Company and Subsidiaries TANGIBLE COMMON EQUITY We also evaluate our business based on certain ratios that utilize tangible common equity. Tangible common equity is a non-GAAP financial measure and represents total equity less preferred equity, noncontrolling int
Slide 18: Common Equity Tier 1 under Basel III
Common Equity Tier 1 under Basel III Wells Fargo & Company and Subsidiaries RISK-BASED CAPITAL RATIOS UNDER BASEL III (1) Estimated Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, (in billions, except ratio) 2022 2022 2021 2021 2021 Total equity $ 179.8 181.7 190.1 191.1 193.1 Adjustments: Preferred stock (
Slide 19: Disclaimer and forward-looking statements
Disclaimer and forward-looking statements Financial results reported in this document are preliminary. Final financial results and other disclosures will be reported in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2022, and may differ materially from the results and disclosures i
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