Wells Fargo reports Q3 noninterest expense $13.8B
Noninterest expense in the third quarter declined $219M from the prior quarter to $13.8B, predominantly due to lower commission and incentive compensation, outside professional services and charitable donations expense. These decreases were partially offset by higher employee benefits, equipment and contract services expense. The efficiency ratio was 62.7 percent in third quarter 2018, compared with 64.9 percent in the second quarter. Third quarter 2018 operating losses were $605M, driven primarily by remediation expense for a variety of matters, including an additional $241M accrual for previously disclosed issues related to automobile collateral protection insurance. Average deposits of $1.3 trillion, down $40.0 billion, or 3 percent. Average loans of $939.5 billion, down $12.9 billion, or 1 percent. Return on assets of 1.27 percent, return on equity of 12.04 percent, and return on average tangible common equity of 14.33 percent. Common Equity Tier 1 ratio of 11.9 percent. Returned $8.9B to shareholders through common stock dividends and net share repurchases, which more than doubled from $4B in third quarter 2017. Net interest income in the third quarter was $12.6B, up $31M from second quarter 2018. Net interest margin was 2.94 percent, up 1 basis point from the prior quarter.