Wells Fargo posted third-quarter net income of $5.95 billion, or $1.87 a share, up from $5.59 billion, or $1.66 a share, a year earlier, as the lender finally put the Federal Reserve’s asset cap behind it and leaned into credit-card and auto lending.
The numbers
Net interest income climbed 5 percent to $12.52 billion for the three months ended September 30, helped by the reinvestment of matured assets into higher-yielding securities. The per-share gain of 21 cents reflects both the revenue lift and a share count that has been shrinking under the bank’s buyback program.
The cap is gone
The Fed’s removal of the years-long growth restriction earlier this year gave Wells Fargo room to deploy more of its balance sheet. Management has directed that capacity toward consumer credit, where spending has held up despite higher prices, and toward commercial borrowers riding a wave of AI-driven capital expenditure.
The index tells a different story
Bank shares have not celebrated. The KBW Bank Index has fallen more than 12 percent from its August peak as traders price in the risk that further rate increases will choke the very loan growth Wells Fargo is reporting. Chief financial officer Mike Santomassimo struck an upbeat tone last month on the full-year outlook, but the market is weighting funding-cost pressure over credit-quality comfort.
What to watch
Analysts expect elevated bond yields to support net interest income in the near term. The tension is whether rising deposit costs and a slowing economy will erode that tailwind before the bank can grow its way past it.