Lower expenses and fewer bad loans helped lift Wells Fargo’s second-quarter profit by 20 percent, the company reported Friday.
The cost-cutting and improved loan quality helped the nation’s biggest U.S. mortgage lender overcome meager revenue growth.
Net income rose to $5.27 billion from $4.40 billion a year earlier, excluding dividend payments on preferred stock. On a per-share basis, earnings were 98 cents, beating the 93 cents forecast by Wall Street.
Revenue edged up to $21.4 billion from $21.3 billion and exceeded Wall Street expectations.
The company’s stock rose 74 cents, or 1.8 percent, to $42.63 in trading Friday.
Interest rates on mortgages have risen sharply in recent weeks, and analysts are concerned about the potential effect on its mortgage business.
The San Francisco bank controls nearly a third of the U.S. mortgage market, and that has helped bolster its earnings recently. Much of its lending came from refinancing, which has been reduced by the spike in interest rates.