Wells Fargo & Company · NYSE:WFC
Wells Fargo & — Q2 2021 Earnings Presentation
19 slides from Wells Fargo &'s earnings presentation, Jul 14, 2021
Slide 1: 2Q21 Financial Results
2Q21 Financial Results July 14, 2021 In second quarter 2021, we elected to change our accounting method for low-income housing tax credit (LIHTC) investments. We also elected to change the presentation of investment tax credits related to solar energy investments. Prior period financial statement li
Slide 2: Actively helping our customers and communities
Actively helping our customers and communities Supporting Our Customers Supporting Our Communities • Helped 3.7 million consumer and small business customers by deferring • Charitable Contributions: Deployed $656 million in philanthropic contributions, payments and waiving fees including support for
Slide 3: 2Q21 results
2Q21 results • Net income of $6.0 billion, or $1.38 per diluted common share – Revenue of $20.3 billion, up 11% ◦ Net gains from equity securities of $2.7 billion ($2.0 billion net of noncontrolling interests), up from $533 million in 2Q20 and $392 million in 1Q21 Financial Results – Noninterest exp
Slide 4: 2Q21 earnings
2Q21 earnings $ in millions (mm), except per share data 2Q21 1Q21 2Q20 vs. 1Q21 vs. 2Q20 Net interest income $8,800 8,808 9,892 ($8) (1,092) Noninterest income 11,470 9,724 8,394 1,746 3,076 Total revenue 20,270 18,532 18,286 1,738 1,984 Net charge-offs 379 523 1,114 (144) (735) Change in the allowa
Slide 5: Credit quality
Credit quality Provision for Credit Losses and Net Charge-offs ($ in millions) Allowance for Credit Losses for Loans ($ in millions) 9,534 20,436 20,471 19,713 0.46% 18,043 8,767 8,929 8,197 16,391 7,361 6,821 2.19% 2.22% 2.22% 0.29% 2.09% 0.26% 1.92% 0.24% 11,669 11,542 11,516 10,682 9,570 1,114 0.
Slide 6: Average loans and deposits
Average loans and deposits Average Loans Outstanding ($ in billions) Average Deposits and Rates ($ in billions) 971.3 1,435.8 1,386.7 1,399.0 1,380.1 1,393.5 931.7 46.5 41.7 899.7 82.7 68.0 56.4 873.4 854.7 175.0 169.4 169.8 173.7 165.2 Corporate 426.0 190.8 434.0 226.1 205.8 194.5 Wealth and 423.2
Slide 7: Net interest income
Net interest income Net Interest Income ($ in millions) • Net interest income decreased $1.1 billion, or 11%, YoY reflecting the impact of lower interest rates, lower loan balances due to soft demand and elevated prepayments, as well as higher mortgage-backed securities (MBS) premium amortization, p
Slide 8: Noninterest expense
Noninterest expense Noninterest Expense ($ in millions) • Noninterest expense down 8% from 2Q20 15,229 14,802 14,551 – Personnel expense down 1% 13,989 104 13,341 ◦ Lower deferred compensation expense and lower salaries expense on 79 4,668 4,452 reduced headcount 4,416 4,101 718 4,145 ◦ Partially of
Slide 9: Consumer Banking and Lending
Consumer Banking and Lending Summary Financials • Total revenue up 14% YoY and up modestly from 1Q21 $ in millions (mm) 2Q21 vs. 1Q21 vs. 2Q20 – CSBB up 7% YoY and 4% from 1Q21 primarily driven by higher deposit-related Revenue by line of business: fees and higher debit card transactions Consumer an
Slide 10: Consumer Banking and Lending
Consumer Banking and Lending 1 Mortgage Loan Originations ($ in billions) Debit Card Point of Sale (POS) Volume and Transactions 61.6 59.2 28.8 53.9 51.8 53.2 122.0 28.7 21.6 16.3 105.3 108.5 18.2 102.9 93.1 2.3 2.5 2.3 2.3 51% 52% 55% 62% 64% 2.0 32.8 33.6 36.9 30.5 32.3 2Q20 3Q20 4Q20 1Q21 2Q21 2Q
Slide 11: Commercial Banking
Commercial Banking 1 Summary Financials • Total revenue down 10% YoY and up 1% from 1Q21 $ in millions 2Q21 vs. 1Q21 vs. 2Q20 – Middle Market Banking revenue down 9% YoY primarily due to lower loan Revenue by line of business: balances on reduced client demand and line utilization, as well as the im
Slide 12: Corporate and Investment Banking
Corporate and Investment Banking Summary Financials • Total revenue down 18% YoY and down 7% from 1Q21 $ in millions 2Q21 vs. 1Q21 vs. 2Q20 – Banking revenue down 6% YoY on lower debt capital markets, the impact of Revenue by line of business: lower interest rates, and lower deposit balances predomi
Slide 13: Wealth and Investment Management
Wealth and Investment Management Summary Financials • Total revenue up 10% YoY $ in millions 2Q21 vs. 1Q21 vs. 2Q20 – Net interest income down 15% YoY driven by the impact of lower interest Net interest income $610 ($47) (109) rates, partially offset by higher deposit and loan balances Noninterest i
Slide 14: Corporate
Corporate 1 Summary Financials • Net interest income down YoY primarily due to the impact of lower interest $ in millions 2Q21 vs. 1Q21 vs. 2Q20 rates and lower loan balances due to the sale of student loans Net interest income ($304) $86 (364) • Noninterest income up both YoY and from 1Q21 and incl
Slide 15: Appendix
Appendix
Slide 16: Accounting policy changes for tax-advantaged investments
Accounting policy changes for tax-advantaged investments • We make investments in affordable housing and renewable energy to support our community development and sustainability efforts • In 2Q21, we elected to change our accounting for low-income housing tax credit • Prior period financial statemen
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) 2021 2021 2020 2020 2020 Total equity (2) $ 193.1 188.0 185.7 181.7 178.6 Effect of accounting polic
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, 2021, and may differ materially from the results and disclosures i
Wells Fargo & Company — Q2 2021 Earnings Presentation on 6ix