""Wells Fargo"":http://www.wellsfargo.com reported net income of $4.1 billion over the July-to-September period.
[IMAGE]The company called it a ""record"" quarter, but even with profits up 21 percent from the prior year and up 3 percent from the previous quarter, the numbers were overshadowed by the fact that the bank's Q3 results missed market expectations.
Analysts polled by Thomson Reuters were expecting revenue of $20.24 billion, but the bank's third quarter produced revenue of $19.6 billion, a 6 percent decline from a year earlier. At the same time, net income of 72 cents per share just missed forecasts of 73 cents per share.
[COLUMN_BREAK]According to the _Wall Street Journal_, it's the first time in more than two years that Wells Fargo didn't live up to analysts' expectations.
Improvement associated with credit quality helped to bolster the San Francisco-based bank's net income despite declining revenue.
Net loan charge-offs declined to $2.6 billion in Q3, down $227 million from the previous quarter and down $1.5 billion from the same period last year.
Nonperforming assets totaled $26.8 billion, a decline of $1.1 billion from the second quarter of this year and down $7.6 billion from the third quarter of 2010.
The company also released $800 million from its loan loss reserves â€" a move Wells Fargo says reflects ""improved portfolio performance.""
While the bank is seeing evidence of improving credit quality, pre-existing mortgage troubles continue to weigh heavy on its balance sheet.
Wells Fargo’s ""latest earnings report"":https://www.wellsfargo.com/downloads/pdf/press/3q11pr.pdf reflects a 61 percent increase in its provisions for expected mortgage buybacks. The company earmarked $390 million for mortgage loan repurchase losses, compared with $242 million at the end of the second quarter.