Wells Fargo (CFM) – Get a free report Shares fell in premarket trading ahead of the bank’s third-quarter earnings report before Friday’s opening bell.
Wells Fargo is expected to post a bottom line of $1.24 per share, down 4.6% from the same period last year, on revenue of about $20.1 billion, according to Street forecasts.
The bank’s profits will also be hit by the payment of $1.8 billion to the Federal Deposit Insurance Corporation in August as it helped replenish the government’s deposit insurance fund, from which about $16 billion was lost. dollars following the collapse of Silicon Valley Bank and Signature Bank and the sale of the First Republic.
Wells Fargo said at the time of the payment in early August that it “expects a significant increase in its risk-weighted assets and a net increase in its capital requirements” following rule changes requiring U.S. lenders to set aside larger amounts of cash to absorb potential losses in their loan portfolios under the so-called final Basel III capital requirements.
The bank’s exposure to commercial real estate will also be in the spotlight, after it set aside $949 million in the second quarter to cover potential losses even as revenue from its holdings rose to $1.33 billion.
Wells Fargo shares fell 0.6% in premarket trading to indicate an opening price of $39.50 each, indicating the stock has seen little change over the past six months.
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