Wells Fargo reported a net income of $5.8 billion, or $1.05 per diluted common share, an increase of 1 percent year-over-year, according to the bank's 2015 third quarter earnings statement released Wednesday morning.
Wells Fargo's strong third quarter results was led by growth in loans, deposits, and capital, and positive credit quality.
The bank saw strong growth in loans and deposits, with total average loans of $895.1 billion, up 7 percent or $61.9 billion year-over-year. As of September 30, 2015, total loans were $903.2 billion. Quarter-end loans rose $64.4 billion to $903.2 billion, while total average deposits increased $71.8 billion to $1.2 trillion.
Revenue at Wells Fargo totaled $21.9 billion, an increase of three percent from $21.2 billion last year. Driven by growth n investment securities and loans, net interest income rose $187 million from the second quarter of 2015 to $11.5 billion in the current quarter. Meanwhile, the company's net interest margin was 2.96 percent, down 1 basis point from last quarter.
John Stumpf, chairman and CEO of Wells Fargo noted that the strong third quarter results "reflected the ability of our diversified business model to generate consistent financial performance in an uneven economic environment while continuing to meet our customers' financial needs."
"Compared with a year ago, we grew loans, deposits and capital, and returned more capital to shareholders through dividends and share buybacks. Our balance sheet and credit results remained strong and our 265,000 team members continue to focus on helping our customers succeed financially."
Mortgage banking noninterest income fell $116 million from second quarter to $1.6 billion, Wells Fargo reported. In addition, residential mortgage originations were $55 billion in the third quarter, down $7 billion linked quarter. The production margin on residential held-for-sale mortgage originations was 1.88 percent, compared with 1.75 percent in the previous quarter. Net mortgage servicing rights (MSRs) results were $253 million, compared with $107 million in second quarter 2015.
Bank of America's year-to-date net income totals $13.2 billion or $1.09 per share. Revenue declined $521 million to $20.9 billion from last year, mostly driven by higher negative market-related adjustments on their debt securities portfolio due to lower long-term interest rates.
Net interest income for the bank also fell $702 million to $9.7 billion year-over-year due to lower consumer loan balances and lower yields. Meanwhile, noninterest income rose $181 million to $11.2 billion from last year, reflecting increases in mortgage banking and card income, higher asset management fees, and other income.
The company originated $13.7 billion in first-lien residential mortgage loans and $3.1 billion in home equity loans in the third quarter of 2015, compared to $11.7 billion and $3.2 billion, respectively, in the year-ago quarter.
Bank of America CEO Brian Moynihan explained that the "solid results" in the third quarter reflected the execution of their "long-term strategy."
"The key drivers of our business–deposit taking and lending to both our consumer and corporate clients–moved in the right direction this quarter and our trading results on behalf of clients remained fairly stable in challenging capital markets conditions. Our balanced approach to serving customers and clients is on track as the economy continues to move forward."
"Our results this quarter reflect our ongoing efforts to improve operating leverage while continuing to invest in our business," said Paul Donofrio, CFO at Bank of America. "We built capital and liquidity to record levels and grew total loans for the second consecutive quarter while continuing to operate within our risk framework."
Click here to view Wells Fargo's earnings statement.
Click here to view Bank of America's earnings statement.