Wells Fargo's earnings aided by consumers, capital markets

Core Insights - Wells Fargo reported a strong third-quarter performance, with net income of $5.6 billion, a 9% increase from the same period in 2024, exceeding analysts' expectations of $1.54 per share with actual earnings of $1.66 per share [1][6] - The bank's total quarterly revenue reached $21.4 billion, marking a 5% annual increase, driven by growth in consumer and investment banking [2][6] - CEO Charlie Scharf has transitioned to the role of chairman, despite opposition from a shareholder activist group [2] Financial Performance - The bank experienced strong growth across multiple business lines, leading to higher spread income and fee income [2] - Auto loan originations rose significantly to $8.8 billion in the third quarter, up from $4.1 billion a year ago, while credit card spending volume increased by 9% to over $47 billion [4] - Wells Fargo reported declines in net charge-offs and nonaccrual loans, indicating stable credit performance [3] Economic Context - The positive results were attributed to underlying strength in the U.S. economy, with wages keeping pace with inflation and historically low unemployment rates [5][6] - The bank has increased its target for return on tangible common equity to 17%-18%, up from the previous guidance of 15% [6]