Wells Fargo & Company · NYSE:WFC
Wells Fargo & — Q4 2024 Earnings Presentation
25 slides from Wells Fargo &'s earnings presentation, Jan 15, 2025
Slide 1: 4Q24 Financial Results
4Q24 Financial Results January 15, 2025 © 2025 Wells Fargo Bank, N.A. All rights reserved.
Slide 2: 4Q24 results
4Q24 results • Net income of $5.1 billion, or $1.43 per diluted common share, included: ($ in millions, except EPS) Pre-tax Income EPS Discrete tax benefits related to the resolution of prior period matters $863 $0.26 Severance expense (647) (0.15) Net losses on debt securities related to a repositi
Slide 3: 4Q24 earnings
4Q24 earnings Quarter ended $ Change from Year ended $ Change from $ in millions, except per share data 4Q24 3Q24 4Q23 3Q24 4Q23 2024 2023 2023 Net interest income $11,836 11,690 12,771 $146 (935) $47,676 52,375 ($4,699) Noninterest income 8,542 8,676 7,707 (134) 835 34,620 30,222 4,398 Total revenu
Slide 4: Net interest income
Net interest income Net Interest Income ($ in millions) • Net interest income down $935 million, or 7%, from 4Q23 driven by deposit mix and pricing changes, the impact of lower rates on floating rate assets, and lower loan balances, partially offset by lower market funding 12,771 12,227 11,923 11,69
Slide 5: Loans and deposits
Loans and deposits Average Loans Outstanding ($ in billions) Average Deposits ($ in billions) 938.0 928.1 1,340.9 1,341.6 1,346.5 1,341.7 1,353.8 917.0 910.3 906.4 111.1 92.6 72.5 122.9 119.6 118.3 Corporate 102.1 101.5 102.8 108.0 389.7 386.0 Wealth and 382.2 379.7 378.1 173.1 183.3 187.5 194.3 205
Slide 6: Noninterest income
Noninterest income Noninterest Income ($ in millions) • Noninterest income increased $835 million, or 11%, from 4Q23 1 – Investment advisory fees and brokerage commissions up $413 million, or 15%, driven by higher asset-based fees reflecting higher market 8,766 8,676 valuations 8,636 8,542 – Deposit
Slide 7: Noninterest expense
Noninterest expense Noninterest Expense ($ in millions) • Noninterest expense down $1.9 billion from 4Q23 2 – FDIC special assessment down $2.0 billion 15,786 – Personnel expense down $110 million on lower severance expense and the 355 impact of efficiency initiatives, partially offset by higher rev
Slide 8: Credit quality: net loan charge-offs
Credit quality: net loan charge-offs 1 Provision for Credit Losses and Net Loan Charge-offs ($ in millions) • Commercial net loan charge-offs up $80 million to 30 bps of average loans (annualized) reflecting a $77 million increase in commercial real estate (CRE) net loan charge-offs 1,282 1,252 1,30
Slide 9: Credit quality: allowance for credit losses for loans
Credit quality: allowance for credit losses for loans Allowance for Credit Losses for Loans ($ in millions) • Allowance for credit losses for loans (ACL) down $103 million as modest ACL declines across most asset classes were partially offset by a higher ACL for credit card loans on higher loan bala
Slide 10: Capital and liquidity
Capital and liquidity 1 Common Equity Tier 1 Ratio under the Standardized Approach Capital Position 1 • Common Equity Tier 1 (CET1) ratio of 11.1% at December 31, 2024 11.4% 11.2% 11.3% • CET1 ratio down 30 bps from 4Q23 and down 20 bps from 3Q24 11.0% 11.1% – A decrease in accumulated other compreh
Slide 11: Consumer Banking and Lending (CBL)
Consumer Banking and Lending (CBL) Summary Financials • Total revenue down 6% YoY and down 2% from 3Q24 $ in millions (mm) 4Q24 vs. 3Q24 vs. 4Q23 – CSBB down 7% YoY driven by lower net interest income reflecting the impact Revenue by line of business: of customer migration to higher yielding deposit
Slide 12: Consumer Banking and Lending
Consumer Banking and Lending 1 Retail Mortgage Loan Originations ($ in billions) Debit Card Purchase Volume and Transactions 126.1 128.2 126.8 131.0 121.5 5.9 5.3 5.5 4.5 2.6 2.6 2.5 2.6 3.5 27% 2.4 24% 20% 18% 13% 4Q23 1Q24 2Q24 3Q24 4Q24 4Q23 1Q24 2Q24 3Q24 4Q24 Refinances as a % of Retail Origina
Slide 13: Commercial Banking (CB)
Commercial Banking (CB) Summary Financials • Total revenue down 6% YoY and down 5% from 3Q24 $ in millions 4Q24 vs. 3Q24 vs. 4Q23 – Middle Market Banking revenue down 2% YoY driven by lower net interest Revenue by line of business: income reflecting the impact of higher deposit costs, partially offs
Slide 14: Corporate and Investment Banking (CIB)
Corporate and Investment Banking (CIB) Summary Financials • Total revenue down 3% YoY and down 6% from 3Q24 $ in millions 4Q24 vs. 3Q24 vs. 4Q23 Revenue by line of business: – Banking revenue down 4% YoY driven by higher deposit costs and lower loan balances, partially offset by higher investment ba
Slide 15: Wealth and Investment Management (WIM)
Wealth and Investment Management (WIM) Summary Financials • Total revenue up 8% YoY and up 2% from 3Q24 $ in millions 4Q24 vs. 3Q24 vs. 4Q23 – Net interest income down 6% YoY driven by higher deposit costs including Net interest income $856 $14 (50) the impact of increased pricing on sweep deposits
Slide 16: Corporate
Corporate Summary Financials • Revenue increased YoY reflecting improved results from our venture capital $ in millions 4Q24 vs. 3Q24 vs. 4Q23 investments and net interest income improvement due to lower crediting Net interest income ($264) $151 280 rates paid to our operating segments, partially of
Slide 17: Outlook
Outlook Net Interest Expect 2025 net interest income to be ~1% to 3% higher than in 2024 Income Expect 2025 noninterest expense to be ~$54.2 billion Noninterest • Includes ~$600 million of higher expected revenue-related expense in Wealth and Investment Expense Management Return on Tangible We have
Slide 18: 2025 net interest income expectation
2025 net interest income expectation 2025 Net Interest Income (NII) Expectation • 2025 net interest income is expected to be ~1 to 3% higher than 2024 net ($ in billions) interest income of $47.7 billion. Key assumptions include: Forward Rate Curve as of 1/8/25 Expect 2025 NII to be ~1 to 3% higher
Slide 19: 2025 expense expectation
2025 expense expectation Building the right risk and control infrastructure to strengthen our Company remains our top priority 2025 Expense Expectation • 2025 expense expectations ($ in billions) – ~$1.1 billion of operating losses $54.6 0.2 ~ $54.2 – Lower severance expense 0.6 – Higher revenue-rel
Slide 20: Areas of focus for 2025 investments
Areas of focus for 2025 investments Firmwide / Risk & Control Consumer, Small and Business Banking Consumer Lending • Continue to build our risk and control infrastructure and • Modernization of our core banking platform • Continue to invest in core card capabilities that improve the remediate regul
Slide 21: Endnotes
Endnotes Page 2 – 4Q24 results 1. Tangible common equity and return on average tangible common equity (ROTCE) are non-GAAP financial measures. For additional information, including a corresponding reconciliation to GAAP financial measures, see the “Tangible Common Equity” table on page 23. 2. The ef
Slide 22: Endnotes (continued)
Endnotes (continued) Page 8 – Credit quality: net loan charge-offs 1. Includes provision for credit losses for loans, debt securities, and other financial assets. Page 10 – Capital and liquidity 1. The Common Equity Tier 1 (CET1) ratio calculated under the Standardized Approach is our binding CET1 r
Slide 23: Tangible Common Equity
Tangible Common Equity Wells Fargo & Company and Subsidiaries TANGIBLE COMMON EQUITY We also evaluate our business based on certain ratios that utilize tangible common equity. Tangible common equity is a non-GAAP financial measure and represents total equity less preferred equity, noncontrolling int
Slide 24: Common Equity Tier 1 under Basel III
Common Equity Tier 1 under Basel III Wells Fargo & Company and Subsidiaries 1 RISK-BASED CAPITAL RATIOS UNDER BASEL III Estimated Dec 31, Sep 30, Jun 30, Mar 31, Dec 31, ($ in billions) 2024 2024 2024 2024 2023 Total equity $ 181.1 185.0 178.1 182.7 187.4 Adjustments: Preferred stock (18.6) (18.6) (
Slide 25: 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 Annual Report on Form 10-K for the year ended December 31, 2024, and may differ materially from the results and disclosures in
Wells Fargo & Company — Q4 2024 Earnings Presentation on 6ix