Steady performance marks Wells Fargo’s 2024 achievements

ByInvestment Club

Overview

Wells Fargo delivered an important performance in Q4 2024, driven by growth in noninterest income, improved expense efficiency, and solid credit quality. The results demonstrate the bank’s focus on operational excellence and disciplined risk management.

Q4 2024 vs. Q4 2023:

Revenue and profitability

  • Total revenue reached $20.4bn, slightly lower by 6% YoY, but reflecting stable performance across segments.
  • Net income increased to $5.1bn (+47% vs. 2023), supported by effective cost controls and improved credit quality.
  • Diluted earnings per share (EPS) improved to $1.43, up from $0.86 YoY.
  • Pre-tax pre-provision profit (PTPP) grew to $6.5bn (+38% YoY).

Noninterest income

  • Noninterest income increased to $8.5bn (+11% YoY), driven by higher investment banking fees (+59%), investment advisory fees (+15%), and card fees (+6%).

Expense efficiency

  • Noninterest expenses dropped to $13.9bn (-12% vs. 2023), reflecting lower personnel and severance expenses, as well as efficiency initiatives.
  • The efficiency ratio improved to 68%, a significant reduction from 77% YoY.

Credit quality

  • Net loan charge-offs decreased by $70m YoY to $1.2bn, reflecting better loan performance in commercial and residential mortgages.
  • Allowance for credit losses (ACL) stood at $14.6bn (-3% vs. 2023).

Capital and liquidity

  • The Common Equity Tier 1 (CET1) ratio was 11.1%, above regulatory minimums.
  • Liquidity coverage ratio (LCR) remained strong at 125%.

Full-Year 2024 performance:

Revenue

  • Full-year total revenue of $82.3bn, reflecting stable results compared to 2023.
  • Net income grew to $19.7bn (+3% YoY), with a full-year EPS of $5.37.

Operational highlights

  • Return on equity (ROE) improved to 11.4%, and Return on Tangible Common Equity (ROTCE) rose to 13.4%, up from 11.0% and 13.1%, respectively, in 2023.
  • Wells Fargo returned $4bn to shareholders through stock repurchases and paid $1.3bn in dividends during Q4 2024.

Segment highlights

  • Average loans totaled $906.4bn (-3% YoY), but relatively stable compared to Q3 2024, with growth in commercial and industrial loans offsetting declines in residential mortgages.
  • Average deposits increased to $1.4tn (+1% YoY and +2% QoQ), reflecting growth in customer deposits while reducing higher-cost certificates of deposit (CDs).
  • Wealth and Investment Management reported total client assets of $2.3tn (+10% YoY), supported by higher asset valuations.
  • Consumer Banking and Lending saw steady growth, with digital active customers reaching 36m (+3% YoY).

Chief Executive Officer Charlie Scharf commented: “I believe we are still in the early stages of seeing the benefits of the momentum we are building, and our financial performance should continue to benefit from the work we are doing to transform the company. I want to thank everyone who works at Wells Fargo for their hard work over the past year and for what they do every single day to support our customers, clients, and communities”.

On the prospects for 2025, Wells Fargo expects net interest income to grow 1–3% YoY, supported by higher deposit balances and loan growth in priority segments. The bank remains committed to achieving a sustainable ROTCE of 15% through continued investments in efficiency initiatives, risk management, and digital transformation.

Author: Ionuț-Adrian Lazar

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