Wells Fargo Reports 30 Percent Increase in Net Income.-- Re Third Quarter Year to Date % Change % Change 1999 fro 1.88% 19 1.85% 19 Retur1999, compared with $742 million for the third quarter of 1998, an increase of 30 percent. Net income for thngs per common share were a record $.57 for the ercent for the first nine months of 1999, compared with 14.72 percent and 14.55 percent for the same periods of 1998. Diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. cash earnings were a record $.65 per share for the third quarter of 1999 and a record $1.89 per share for the first nine months of 1999, compared with $.53 per share and $1.55 per share for the same periods of 1998. Cash return on average assets was 2.24 percent for the thirdp). "The successful merger of equals of Nok Kovacevich, president and chief executive offst successful. We're we're Contraction of we are. we're we are on schedule to convert our. We're on schedule to complete all our state conversions by the first quarter of 2001. It's it's 1. Contraction of it is. 2. Contraction of it has. See Usage Note at its. it's it is or it has it's be ~have testimony Oral evidence offered by a competent witness under oath, which is used to establish some fact or set of facts. Testimony is distinguishable from evidence that is acquired through the use of written sources, such as documents. testimony n. to the hard work and customer focus of our entire team that during more than 100,000 customers each month, more ths for our customers," said Clyde Clyde, principal river of SW Scotland, 106 mi (171 km) long, rising in the Southern Uplands and flowing generally NW through Glasgow to the Firth of Clyde. It drains c.1,480 sq mi (3,830 sq km). Ostler, head of Wells Fargo's Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the Services Group. "Recently, we rolled out our real-time 1. real-time - Describes an application which requires a program to respond to stimuli within some small upper limit of response time (typically milli- or microseconds). Process control at a chemical plant is the classic example. home equity credit decision capabilitts." Net Interest Income Net intmonths of 1999, compared with $6,734 million for the same period a year ago. The net interest margin was 5.73 percent for the third quarter of 1999 and 5.67 percent for the first nine months of 1999, compared with 5.88 percent and 5.86 percent in the same periods of 1998. The decrease in the net interest margin for both the third quarter and the first nine months was primarily due to higher balances of lower yielding investment securities and lower yields on consumer loans and commercial real estate mortgages partialame quarter of 1998, an increase of 12 percent.ter of 1999 was mostly due to higher net mortgagillion in the same quarter of 1998. In the first nine months of 1999, noninterest expense was $7,124 million, compared with $7,097 million in the same period of 1998. The efficiency ratio improved to 57.7 percent for the third quarter of oans (annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. ), for the third quarter of 199 a loan loss provision of $921 million and net charge-offs of $931 million, or 1.18 percent of average loans (annualized) for the same period of 1998. At September September: see month. 8 and $722 million at September 30, 1998. Net income of the four business segments was: $2,110 $1,500 Wholesale Banking t services primarily in 21 midwestern Mid·west or Middle West A region of the north-central United States around the Great Lakes and the upper Mississippi Valley. It is generally considered to include Ohio, Indiana, Illinois, Michigan, Wisconsin, Minnesota, Iowa, Missouri, Kansas, and and westehs of 1999, earnings were 41 percent higher than the corresponding period for 1998. "The merger has produced sales momentum in Community Banking for the third consecutive quarter," said Les Biller bill·er n. One that bills, as: a. A clerk who prepares bills. b. A machine used in preparing bills. , vice chairman and chief operating such a short time, because the spirit and energy of our team members throughout the state is great," said Tf Internet home equity loans not only enables uoduct area." Wholesale Banking serveial and corporate banking and real estate servicrnings were 4 percent higher than the corresponding period for 1998. "We remain focused on our strategy of cross-selling Cross-selling is the term used to describe the sale of additional products or services to a customer. Less frequently it is used to describe the sale of services to additional business units at an account or to different geographic units of a customer. and attracting new customers in Wholesale Bwo asset-based lending Asset-Based Lending A business loan secured by collateral (assets). The loan, or line of credit, is secured by inventory, accounts receivable and/or other balance-sheet assets. Also known as "commercial finance" or "asset-based financing". businesses." Norwest For the sniper, see .
Norwest Corporation Mortgage is the second largest originator Originator A bank, savings and loan, or mortgage banker that initially made a mortgage loan that is part of a pool. Also, an investment bank that has worked with the issuer of a new securities offering from the beginning and is usually appointed manager of the underwriting and servicer of home mortgage loans in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . For the thi98 9/30/98 Mortgage originations: Quarter $ 19 $ 23 $ 28 $ 35 $ 28 Year to date 69 50 28 109 75 Unclosed un·close v. un·closed, un·clos·ing, un·clos·es v.tr. 1. To open. 2. To disclose. v.intr. 1. To be opened. 2. To undergo disclosure. pipeline 16 19 20 26 23 Servicing portfolio 274 266 257 245 233 Amortization of capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. servicing rights (in millions): Quarter 139 166 294 215 242 Year to date 599 460 294 1.58 1.53 1.41 1.26 1.17strong performance once again demonstrates the value of maintaining a balanced presence in both the origination Origination The process through which a mortgage lender creates a mortgage secured by some amount of the mortgagor's real property. Notes: Also known as loan origination, everyone must go through the origination process when securing a mortgage for a piece of real and servicing businesses. During the quarter, we continuevisibility, expand our consumer outreach Outreach is an effort by an organization or group to connect its ideas or practices to the efforts of other organizations, groups, specific audiences or the general public. , and dmerica. Norwest Financial reported earnings of $66 million in the third quarter of 1999, 20 percent above the third quarter 1998 earnings of $55 million. For the first nine months of 1999, earnings were 16 percent higher thanmpany and subsidiaries (the Company) is a $207 s across North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , including all 50 states, and elsewhere internationally. On November November: see month. 2, 1998, Wells Fargo Wells Fargo armored carriers of bullion. [Am. Hist.: Brewer Dictionary, 1147] See : Protectiveness Wells Fargo company that handled express service to western states; often robbed. [Am. Hist. & Company (the former Wells Fargo) merged with WFC WFC Wi-Fi Connection (Nintendo gaming service) WFC Wide-Field Camera WFC World Financial Center (New York) WFC Workforce Center WFC World Federation of Chiropractic WFC World Food Council This press release (including information in, products or services, and forecasts of its revenues, earnings or other measures of economic performance. Forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. can be identified by the fact that g statements. The Company's reports filed with liquidity, interest rate, and Year 2000 risks associated with the Company's business and operations. Other factors described in the Company's June June: see month. 30, 1999 Form 10-Q Form 10-Q See 10-Q. inclse actual conditions, events or results to diffells Fargo Fargo, city (1990 pop. 74,111), seat of Cass co., E N.Dak., at the head of navigation on the Red River, opposite Moorhead, Minn.; inc. 1875. A railroad hub and regional financial and medical center, Fargo is also the trade and distribution center of a spring-wheat & Company and Subsidiaries SUMMARY FINANCIAL DATA -- NEWS RELEASE common share .20 2 Profitability ratios Profitability ratios Ratios that focus on how well a firm is performing. Profit margins measure performance with relation to sales. Rate of return ratios measure performance relative to some measure of size of the investment. (annualized) Net income to average total assets (ROA ROA See: Return on assets ROA See: Right of accumulation ROA See return on assets (ROA). ) 1.88% 1.58% 19 Net income applicable to common stock to average common stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. (ROE A fictitious surname used for an unknown or anonymous person or for a hypothetical person in an illustration. A lawsuit is generally named for the persons who are parties to it. ) 17.97 14.72 22 Total revenue $ 4,191 $ 3,884 8 Efficiency ratio (1) 57.7% Net Income and Ratios Excluding Goodw 25 Earnings per common share 114,709 107,692 7 Allowance for loan losses 3,1658 8 Capital ratios Common stoc $ 13.17 $ 12.40 6 Staff (active, full-time equivalent Full-time equivalent (FTE) is a way to measure a worker's involvement in a project, or a student's enrollment at an educational institution. An FTE of 1.0 means that the person is equivalent to a full-time worker, while an FTE of 0.5 signals that the worker is only half-time. ) 89,528 89,719 -- Common Stock Price High $ 45.31 $ 39.75 14 Low 36.44 27.50 33 % share amounts) ,118 30 Earnings per common share .515 14 Average common shares outstanding 1,649.0 1,614.4 2 Diluted average common shares outstanding 1,667.9 200,694 185,187 8 Average core de Deposit Intangible Amortization and Balancuted earnings per common share 54.2 57.2 (5) At 3,170 -- Goodwill 7,620 7,758 (2) Assets 207,060 195,863 6 Core deposits 125,160 123,792 1 Common stockholdersquity to assets 10.71 10.50 2 $ 45.31 $ 43.88 3 Low 32.13 27.50 17 Period end 39.63 36.00 10 and ROA ratios, net of applicable taxes. 1999. The after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. amounts for the amortization and average balance of nonqualifying CDI CDI compact disc interactive: a system for storing a mix of software, data, audio, and compressed video for interactive use under processor control were $27 million and $807 million, respectively, for the quarte n. 1. Same as 2d Carte. and $314 million and $7,688 million, respec urities available for sale $ 586 $ 424 38% Mortgages held for sale 198 230 (14) Loans held for sale 's subordinated Subordinated A claim ranked lower in priority than other claims. Common stock claims are always subordinated to debt. debentures ision for loan losses 240 307 (22) Net interest income after provision for loan losses 2,142 1,956 10 NON,621 12 NONINTEREST EXPENSE Salaries 776 730 6 Incentive compensation 124 164 (24) Employee benefits 208 167 25 Equipment it intangible 49 5 Total noninterest expense 2,41 $ 962 $ 742 30% NET INCOME APPLICABLE TO COMMON STOCK NINGS PER COMMON SHARE $ .57 $ .45 27% DIVIDENDS DECLARED de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. PER COMMON SHARE $ .20 $ .185 8% Average common shares outstanding 1,648.6 1,617.3 2% Diluted average common shares outstanding 1,667.1 1,640.7 2% Nine months (in millions, except ended Sept. 30, % per share amounts) 1999 1998 Change INTEREST INCOME Sec74 2 Loans 7,912 8,046 (2) Other interest income 150 199 (25) Total interes Deposits 2,075 ,689 4 Provision for loan losses 1,096 993 10 Trust and investment fees and commissions 763 695 10 Mortg 147 Net (losses) gains on securities avait 566 572 (1) Net occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy 576 564 2 Goodwill 7,124 7,097 -- INCOME BEFO 28% DIVIDENDS DECLARED PER COMMON SHARE $ .585 $ .515 14% Average common shares outstanding 1,649.0 1,614.4 2% Diluted average common shares outstanding 1,667.9 1,637.3 2% Wells Fargo & Company and Subsidiari Allowance for loan losses 3,167 3,134 3,170 Net loans 111,542 104,860 104,522 Mortgage servicing Mortgage servicing The collection of monthly payments and penalties, record keeping, payment of insurance and taxes, and possible settlement of default , involved with a mortgage loan. rigent, net 3,124 3,130 3,2 89,685 90,056 89,000 8,377 8,537 8,616 Long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. 24,911 19,709 18,4885 682 STOCKHOLDERS' EQUITY Prefer463 462 Common stock - $1-2/3 par value, authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: 4,000,000,000 shares; issued 1,666,095,265 shares, 1,661,392,590 shares and 1,635,821,810 shares 2,777 2,769 2,726 Additional paid-in capita (1) (3) (4) Treasury Dec. 31, Sept. 30, (in millions, 3 (20) Securities available for sale 15 15 Mortgages held for sale 7 Allowance for loan losses 1osit intangible (12) (14) Goodwill (1) (2) Interest receivable and other assets other assets Assets of relatively small value. For financial reporting purposes, firms frequently combine small assets into a single category rather than listing each item separately. 30 36 Total assets 2% 6% LIABILITIES Noninterest-bearing deposits ued expenses and other liabilities other liabilities Small and relatively insignificant liabilities. For financial reporting purposes, firms often combine small liabilities into this single category rather than listing each liability separately. (2) (3) Long-term debt 26 35 Guaranteed preferred beneficial interests in Company's subordinated debentures - 11 Cumulative other comprehensive income (48) (48) Note receivable note receivable A debt due from borrowers and evidenced by a written promise of payment. Note receivable, an entry on the asset side of many corporate balance sheets, indicates the dollar amount of loans due to be repaid by borrowers. from ESOP ESOP See: Employee Stock Ownership Plan ESOP See Employee Stock Ownership Plan (ESOP). (67) (75) Treasury stock - 16,331,628 shares, 17,334,787 shares and 15,309,106 shares 6 23 Total stockholders' equity 7 8 Total liabilities and stockholders' equity 2% 6% Wells Fargo & Company and Subsidiaries CONDENSED con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. CONSOLIDATED con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY 8 Net income securities valuation allowance ents received on notes receivable from ESOP 8 LOANS Sepestate 1-4 family junior lien lien, claim or charge held by one party, on property owned by a second party, as security for payment of some debt, obligation, or duty owed by that second party. mortgage 12,171 11,128 11,057 Credit card discount) $114,709 $107,994 $107,692 Wells Fargo & Company and Subs to business combinations, net 3 5 83 38 118 Provision for loan loruction -- (1) -- (27) (299) (409) Other revolving (10) (11) (30) (35) Foreign (18) (24) (25) (57) (47) Total loan charge-offs (376) (379) (422 construction -- 4 1 14 36 44 Other revolving credit and monthly payment 60 53 31 149 112 Total consumer 73 (241) (261) (318) (775) (931) 1.18% .94% 1.18% Allowance as a percentage of total loans 2.76% 2.83% 2.94% 2.76% 2.94% Wells Fargo & Company and Subsidiaries NONACCRUAL AND RESTRUCTURED LOANS AND OTHER ASSETS Sept. 30, Dec. 31, Sept. 30, (in millions) 1999 1998 1998 Nonaccrual loans $ 697 $ 709 $ 721 Restructured loans 1 1 1 Nona prop. n. 1. The Fate who spins the thread of life; counterpart of Greek Clotho. $ 900 (1) Represents the amount of real estate investments (contingent Fortuitous; dependent upon the possible occurrence of a future event, the existence of which is not assured. The word contingent denotes that there is no present interest or right but only a conditional one which will become effective upon the happening of the interest loans totaled $108 million, $128 million and $134 mil An Internet address domain name for a military agency. See Internet address. (networking) mil - The top-level domain for entities affiliated with US armed forces. Quarter $ 385 $ 356 8% Trust and investment fees and commissions: Asset management and custody The care, possession, and control of a thing or person. The retention, inspection, guarding, maintenance, or security of a thing within the immediate care and control of the person to whom it is committed. The detention of a person by lawful authority or process. fees 195 167 17 Mutual fuher 23 (1) Total other fees and commissioion 176 (47) -- Net gains on sales of mortgage servicing rights -- -- -- Net (losses) gains on sales of mortgages (16) 142 -- All other Net venture capital gains 16 Cost method 35 32 9 Equity method Nine months 75 72 4 ssions: Cash network fees 201 167 20 Charges and fees on loans nd commissions 763 695 10 Mortgage banking: Origination and other closing fees 330 366 (10) Servicing fees, net of amortization 231 (6) -- Net gains on sales of mortgage servicing rights -- 16 (100) Net (losses) gains on sales of mortgages 116 147 Net (losses) gains on securities available for sale 19 161 (88) Income from equity investments accounted for by the: Cost method 99 116 (15) Equity method 59 43 37 Net gains on sales of loans 32 48 (33) Net gains on dispositions of operations 102 89 15 All other 298 299 -- Total $5,350 $4,870 10% NONINTEREST EXPENSE Quarter ended Sept. 30, % (in millions) 1999 1998 Change Salaries $ 776 $ 730 6% Incentive compensation 124 164 (24) Employee benefits 208 167 25 Equipment 193 192 1 Net occupancy 205 188 9 Goodwill 106 108 (2) Core deposit intangible: Nonqualifying (1) 44 52 (15) Qualifying 5 6 (17) Net losses (gains) on dispositions of premises premises n. 1) in real estate, land and the improvements on it, a building, store, shop, apartment, or other designated structure. The exact premises may be important in determining if an outbuilding (shed, cabana, detached garage) is insured or whether a person and equipment ervices 83 74 12 Contract services 119 89 34 Telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. 66 66 -- Outside data processing data processing or information processing, operations (e.g., handling, merging, sorting, and computing) performed upon data in accordance with strictly defined procedures, such as recording and summarizing the financial transactions of a 69 Stationery The term for boilerplate in the Eudora mail client, starting with Version 3.0. Stationery files are stored on disk and brought into new messages or added to replies. See boilerplate. and supplies 44 30, % (in millions) 1999 1998 Change Salaries $2,251 $2,132 6% Incentive compensa 624 543 equipment (5) 55 -- Operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. 91 106 (14) Outside professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. 243 213 14 Contract services 320 243 32 Telecommunications 191 187 2 Outside data processing 207 174 19 Advertising and promotion 160 181 (12) Postage POSTAGE. The money charged by law for carrying letters, packets and documents by mail. By act of congress of March 3, 1851, Minot's Statute at Large, U. S. 587, it is enacted as follows: 2.-Sec. 1. 169 127 111 14 Security 64 63 2 All other 387 560 (31) Total $7,124 $7,097 -- (1) Amortization of core deposit intangible acquired after February February: see month. 1992 that is subtracted from stockholders' equity in computing computing - computer regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. capital for bank holding companies. Wells Fargo & Company and SubsidEARNING ASSETS Federal funds Federal Funds Funds deposited to regional Federal Reserve Banks by commercial banks, including funds in excess of reserve requirements. Notes: These non-interest bearing deposits are lent out at the Fed funds rate to other banks unable to meet overnight reserve sold and securit 5,915 5.47 85 Securities of Private collateralized mortgage obliga 3,612 6.93 50 Total securities available for sale 35,218 6.85 600 Loans held for sale (3) 4,381 7.24 80 Mortgages held for sale (3) 10,711 7.33 198 Loans: Commercial 36,011 8.88 806 Real estate 1-4 family first mortgage 12,236 8.58 263 Other real estate mortgage 17,243 8.73 379 Real estate construction 4,189 9.38 99 Consumer: Real estate 1-4 family junior lien mortgage 11,817 9.01 267 Credit card 5,323 13.95 187 Other revolving credit Revolving Credit A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the customers current cash flow needs. and monthly payment 16,848 12.06 509 Total consumer 33,988 11.29 963 Lease financing 7,070 7.76 137 Foreign 1,525 20.88 80 Total loans (4) 112,262 9.67 2,727 Other 3,067 4.68 36 Total earning assets Earning Assets Any income-earning asset owned by a company. Notes: These assets are generally interest-bearing accounts, bonds, and securities available for sale. See also: Asset, Asset Valuation, Earnings, Net Interest Margin $166,966 8.73 3,658 FUNDING SOURCES Deposits: Interest-bearing Adj. 1. interest-bearing - of financial obligations on which interest is paid checking $ 2,723 .92 6 Market rate and other savings 56,339 2.23 317 Savings certificates 25,262 4.66 297 Other time deposits 3,276 4.86 40 Deposits in foreign offices 1,552 4.86 19 Total interest-bearing deposits 89,152 3.02 679 Short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. borrowings 17,649 5.09 226 Long-term debt 23,112 5.85 339 Guarante0,698 3.83 1,259 Portion of non interest income on a taxable-equivalent bas4 Other 17,136 Total noninterest-earning assets $36,006 NONINTEREST-BEARING FUNDING SOURCES Deposits $42,435 Other liabilities 8,337 Preferred stockholders' equity 460 Common stockholders' equity 21,042 Noninterest-bearing funding sources used to fund earning assets (36,268) Net noninterest-bearing funding sources $36,006 TOTAL ASSETS $202,972 Quarter ended September 30, 1998 Interest Average Yields/ income/ (in millions) balance rates expense EARNING ASSETS Federal funds sold and securities purchased under resale resale n. selling again, particularly at retail. In many states a "resale license" or "resale number" is required so that the state can monitor the collection of sales tax on retail sales. RESALE. agreements $ 2,120 5.86% $31 Securities available for sale (3): Securities of U.S. Treasury U.S. Treasury Created in 1798, the United States Department of the Treasury is the government (Cabinet) department responsible for issuing all Treasury bonds, notes and bills. Some of the government branches operating under the U.S. Treasury umbrella include the IRS, U.S. and federal agencies 4,494 6.03 68 Securities of U.S. states A U.S. state is any one of the fifty subnational entities of the United States, although four states use the official title "commonwealth". The separate state governments and the federal government share sovereignty, in that an American is a citizen both of the federal entity and and political subdivisions 1,547 8.57 31 Mortgage-backed securities Mortgage-backed securities (MSBs) Securities backed by a pool of mortgage loans. : Federal agencies 15,286 7.09 265 Private collateralized mortgage obligations 3,078 6.70 51 Total mortgage-backed Mortgage-backed may refer to:
securities 18,364 7.03 316 Other securities 1,533 6.29 21 Total securities available for sale 25,938 6.90 436 Loans held for sale (3) 4,757 7.84 93 Mortgages held for sale (3) 13,142 7.01 230 Loans: Commercial 33,762 8.92 758 Real estate 1-4 family first mortgage 12,558 8.47 266 Other real estate mortgage 16,230 9.53 390 Real estate construction 3,764 9.43 90 Consumer: Real estate 1-4 family junior lien mortgage 10,837 9.58 261 Credit card 5,877 15.07 221 Other revolving credit and monthly payment 16,345 12.87 527 Total consumer 33,059 12.18 1,009 Lease financing 5,766 8.20 118 Foreign 1,414 21.03 74 Total loans (4) 106,553 10.11 2,705 Other 2,794 6.71 48 Total earning assets 87,473 3.58 788 Short-term borrowings 13,819 5.59 195 LNING ASSETS Cash and due from banks $10,381 Goodwill 7,811 Othe Company was 8.10% and 8.50% for the quarters ended September 30, 1999 and 1998, respectively. The average three-month London Interbank Offered Rate London Interbank Offered Rate A short-term interest rate often quoted as a 1,3,6-month rate for U.S.dollars. (LIBOR LIBOR See: London Interbank Offered Rate LIBOR See London interbank offered rate (LIBOR). ) was 5.44% and 5.62% for the same quarters, respectively. (2) Interest rates and amounts include the effects of hedge and risk management activities associated with the respective asset and liability categories. (3) Yields are based on amortized cost balances. (4) Nonaccrual loans and related income are included in their respective loan categories. (5) Includes taxable-equivalent adjustments that primarily relate to income on certain loans and securities that is exempt from federal and applicable state income taxes. The federal statutory tax rate was 35% for all periods presented. Wells Fargo & Company and Subsidiaries AVERAGE BALANCES, YIELDS AND RATES PAID (TAXABLE-EQUIVALENT BASIS) (1)(2) Nine months ended September 30, 1999 1998 Interest Interest Average Yields/ income/ Average Yields/ income/ (in millions) balance rates expense balance rates expense EARNING ASSETS Federal funds sold and securities purchased under resale agreements $ 1,311 4.95% $ 49 $ 1,531 5.73% $ 66 Securities available for sale (3): Securities of U.S. Treasury and federal agencies 5,608 5.43 233 5,254 5.97 233 Securities of U.S. states and political subdivisions 3,156 6.82 162 2,641 6.78 3,202 6.81 136 1,460 4.55 60 Total securities available for sale 33,686 6.65 tate 1-4 family first mortgage 9.34 283 3,542 9.48 251 Consumer: Real estate 1-4 family junior lien mortgage 11,336 9.07 770 10,600 9.86 782 Credit card 5,402 13.77 558 6,136 15.05 693 Other revolving credit and monthly payment 15,983 12.38 1,482 16,569 12.81 1,591 Total consumer 32,721 11.46 2,810 33,305 12.29 3,066 Lease financing 6,813 7.81 399 5,417 8.30 337 Foreign 1,505 20.99 237 1,285 20.88 201 Total loans (4) 109,714 9.64 7,919 105,830 10.16 8,055 Other 2,636 5.17 101 3,021 5.97 134 Total earning assets $165,303 8.65 10,673 $153,743 9.14 10,503 FUNDING SOURCES Deposits: Interest -bearing checking $ 2,764 .89 18 $ 2,713 1.40 28 Market rate and other savings 55,996 2.28 956 51,842 2.65 1,026 Savings certificates 26,077 4.76 929 27,774 5.25 1,091 Other time deposits 3,528 4.97 131 4,085 5.52 170 Deposits in foreign offices 1,212 4.51 41 690 4.89 25 Total interest -bearing deposits 89,577 3.10 2,075 87,104 3.59 2,340 Short-term borrowings 17,567 4.83 635 13,570 5.49 557 Long-term debt 20,903 5.81 912 16,828 6.38 805 Guaranteed preferred beneficial interests in Company's subordinated debentures 785 7.54 44 1,089 8.15 67 Total interest- bearing liabilities 128,832 3.80 3,666 118,591 4.25 3,769 Portion of noninterest- bearing funding sources 36,471 -- -- 35,152 -- -- Total funding sources $165,303 2.97 Net interest margin and net i444 NONINTEREST- BEARING FUNDING SOURCES Deposits $42,644 $40,120 Other liabilities 7,866 6,552 Preferred stockholders' equity (35,152) Net noninterest- bearing funding sources $35,391 $31,444 TOTAL ASSETS $200,694 $185,187 (1) The average prime rate of the Company was 7.87% and 8.50% for the nine months ended September 30, 1999 and 1998, respectively. The avive asset and liability categories. (3) Yields are based on amortized cost balances. (4) Nonaccrual loans and related income are included in their respective loan categories. (5) Includes taxable-equivalent adjustments that primarily relate to income on certain loans and securities that is exempt from federal and applicable state income taxes. The federal statutory tax rate was 35% for all periods presented. Wells Fargo & Company and Subsidiaries SUPPLEMENTAL INFORMATION FIVE QUARTER SUMMARY FINANCIAL DATA (in millions, except per share amounts) 3Q99 2Q99 1Q99 4Q98 3Q98 For the Period Net income (loss) $ 962 $ 931 $ 884 $ (194) $ 742 Net income (loss) applicable to common stock 953 922 875 (203) 733 Earnings(loss) per common share $ .58 $ .56 $ .53 $ (.12) $ .45 Diluted earnings (loss) per common share .57 .55 .53 (.12) .45 Dividends declared per common share .20 .20 .185 .185 .185 Average common shares outstanding 1,648.6 1,651.4 1,647.1 1,642.4 1,617.3 Diluted average common shares outstanding 1,667.1 1,672.3 1,664.2 1,642.4 1,640.7 Profitability ratios (annualized) Net income to average total assets (ROA) 1.88% 1.86% 1.80% --% 1.58% Net income applicable to common stock to average common stockholders' equity (ROE) 17.97 17.50 17.33 -- 14.72 Total revenue $ 4,191 $ 4,125 $ 3,993 $ 3,858 $ 3,884 Efficiency ratio (1) 57.7% 57.3% 58.7% 90.2% 60.4% Average loans $ 112,262 $ 108,996 $107,834 $107,324 $106,553 Average assets 202,972 200,342 198,723 197,772 186,634 Average core deposits 126,759 127,563 128,133 127,810 123,720 Net interest margin 5.73% 5.68% 5.58% 5.60% 5.88% Net Income and Ratios Excluding Goodwill and Nonqualifying Core Deposit Intangible Amortization and Balances ("Cash" or "Tangible Possessing a physical form that can be touched or felt. Tangible refers to that which can be seen, weighed, measured, or apprehended by the senses. A tangible object is something that is real and substantial. An automobile is an example of tangible Personal Property. ")(2) Net income (loss) applicable to common stock $ 1,087 $ 1,054 $ 1,008 $ (66) $ 872 Earnings (loss) per common share .66 .64 .61 (.04) .54 Diluted earnings (loss) per common share .65 .63 .61 (.04) .53 ROA 2.24% 2.23% 2.17% --% 1.97% ROE 34.33 33.43 34.38 -- 31.47 Efficiency ratio 54.1 53.7 54.9 86.1 56.3 At Period End Securities available for sale $ 36,906 $ 35,710 $ 35,801 $ 31,997 $ 32,210 Loans 114,709 111,646 108,108 107,994 107,692 Allowance for loan losses 3,167 3,165 3,161 3,134 3,170 Goodwill 7,620 7,598 7,747 7,664 7,758 Assets 207,060 205,421 201,430 202,475 195,863 Core deposits 125,160 127,302 127,996 132,289 123,792 Common stockholders' equity 21,722 20,915 20,817 20,296 20,096 Stockholders' equity 22,182 21,375 21,276 20,759 20,558 Capital ratios Common stockholders' equity to assets 10.49% 10.18% 10.33% 10.02% 10.26% Stockholders' equity to assets 10.71 10.41 10.56 10.25 10.50 Risk-based capital (3) Tier 1 capital 8.65 8.45 8.23 8.08 8.20 Total capital 11.20 11.07 10.97 10.90 11.07 Leverage (3) 7.20 7.05 6.74 6.58 7.00 Book value per common share $ 13.17 $ 12.67 $ 12.60 $ 12.35 $ 12.40 Staff (active, full-time full-time adj. Employed for or involving a standard number of hours of working time: a full-time administrative assistant. full equivalent) 89,528 90,410 90,711 91,403 89,719 Common Stock Price High $ 45.31 $ 44.88 $ 40.44 $ 40.88 $ 39.75 Low 36.44 34.38 32.13 30.19 27.50 Period end 39.63 42.75 35.06 39.94 36.00 (1) The efficiency ratio is defined as noninterest expense divided by total revenue (net interest income and noninterest income). (2) Nonqualifying core deposit intangible (CDI) amortization and average balance excluded from these calculations are, with the exception of the efficiency and ROA ratios, net of applicable taxes. (3) The September 30, 1999 ratios are preliminary. Wells Fargo & Company and Subsidiaries SUPPLEMENTAL INFORMATION FIVE QUARTER STATEMENT OF INCOME (in millions, except per share amounts) 3Q99 2Q99 1Q99 4Q98 3Q98 INTEREST INCOME Securities available for sale $ 586 $ 517 $ 510 $ 514 $ 424 Mortgages held for sale 198 215 258 290 230 Loans held for sale 80 101 99 97 93 Loans 2,725 2,609 2,579 2,639 2,702 Other interest income 52 54 42 58 79 Total interest income 3,641 3,496 3,488 3,598 3,528 INTEREST EXPENSE Deposits 679 679 717 771 788 Short-term borrowings 226 201 208 219 195 Long-term debt 338 290 283 292 266 Guaranteed preferred beneficial interests in Company's subordinated debentures 16 15 14 15 16 Total interest expense 1,259 1,185 1,222 1,297 1,265 NET INTEREST INCOME 2,382 2,311 2,266 2,301 2,263 Provision for loan losses 240 260 270 624 307 Net interest income after provision for loan losses 2,142 2,051 1,996 1,677 1,956 NONINTEREST INCOME Service charges on deposit accounts 385 367 344 364 356 Trust and investment fees and commissions 317 315 300 274 267 Credit card fee revenue 138 126 132 136 136 Other fees and commissions 258 267 238 252 241 Mortgage banking 318 324 327 252 275 Insurance 95 119 85 70 73 Net venture capital gains (losses) 162 13 112 (4) 4 Net (losses) gains on securities available for sale (2) 23 (2) 8 76 Other 138 260 191 205 193 Total noninterest income 1,809 1,814 1,727 1,557 1,621 NONINTEREST EXPENSE Salaries 776 750 725 971 730 Incentive compensation 124 135 134 123 164 Employee benefits 208 217 199 198 167 Equipment 193 182 191 328 192 Net occupancy 205 185 186 200 188 Goodwill 106 104 104 104 108 Core deposit intangible 49 50 52 60 58 Net losses (gains) on dispositions of premises and equipment 6 (13) 2 270 7 Other 751 754 749 1,228 733 Total noninterest expense 2,418 2,364 2,342 3,482 2,347 INCOME (LOSS) BEFORE INCOME TAX EXPENSE (BENEFIT) 1,533 1,501 1,381 (248) 1,230 Income tax expense (benefit) 571 570 497 (54) 488 NET INCOME (LOSS) $ 962 $ 931 $ 884 $(194) $ 742 NET INCOME(LOSS) APPLICABLE TO COMMON STOCK $ 953 $ 922 $ 875 $(203) $ 733 EARNINGS (LOSS) PER COMMON SHARE $ .58 $ .56 $ .53 $(.12) $ .45 DILUTED EARNINGS (LOSS) PER COMMON SHARE $ .57 $ .55 $ .53 $(.12) $ .45 DIVIDENDS DECLARED PER COMMON SHARE $ .20 $ .20 $.185 $.185 $.185 Average common shares outstanding 1,648.6 1,651.4 1,647.1 1,642.4 1,617.3 Diluted average common shares outstanding 1,667.1 1,672.3 1,664.2 1,642.4 1,640.7 Wells Fargo & Company and Subsidiaries SUPPLEMENTAL INFORMATION FIVE QUARTER BALANCE SHEET (QUARTER ENDED) (in millions) 3Q99 2Q99 1Q99 4Q98 3Q98 ASSETS Cash and due from banks $ 12,011 $ 12,633 $ 11,364 $ 12,731 $ 10,985 Federal funds sold and securities purchased under resale agreements 1,556 1,692 869 1,517 1,950 Securities available for sale 36,906 35,710 35,801 31,997 32,210 Mortgages held for sale 9,850 11,781 11,717 19,770 15,469 Loans held for sale 4,661 4,192 5,630 5,322 5,058 Loans 114,709 111,646 108,108 107,994 107,692 Allowance for loan losses 3,167 3,165 3,161 3,134 3,170 Net loans 111,542 108,481 104,947 104,860 104,522 Mortgage servicing rights 4,341 4,080 3,627 3,080 2,725 Premises and equipment, net 3,124 3,141 3,130 3,130 3,279 Core deposit intangible 1,334 1,381 1,437 1,510 1,555 Goodwill 7,620 7,598 7,747 7,664 7,758 Interest receivable and other assets 14,115 14,732 15,161 10,894 10,352 Total assets $ 207,060 $ 205,421 $ 201,430 $ 202,475 $ 195,863 LIABILITIES Noninterest-bearing deposits $ 41,872 $ 43,708 $ 42,322 $ 46,732 $ 40,951 Interest-bearing deposits 89,685 88,834 90,018 90,056 89,000 Total deposits 131,557 132,542 132,340 136,788 129,951 Short-term borrowings 19,248 20,155 17,270 15,897 17,570 Accrued expenses Accrued Expense An accounting expense recognized in the books before it is paid for. It is a liability, usually current. These expenses are typically periodic and documented upon a company's balance sheet due to the high probability of collection. and other liabilities 8,377 9,296 9,396 8,537 8,616 Long-term debt 24,911 21,268 20,363 19,709 18,486 Guaranteed preferred beneficial interests in Company's subordinated debentures 785 785 785 785 682 STOCKHOLDERS' EQUITY Preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. 560 590 604 547 552 Unearned ESOP shares (100) (130) (145) (84) (90) Total preferred stock 460 460 459 463 462 Common stock 2,777 2,777 2,777 2,769 2,726 Additional paid-in capital 8,769 8,764 8,733 8,673 7,921 Retained earnings Retained Earnings The percentage of net earnings not paid out in dividends, but retained by the company to be reinvested in its core business or to pay debt. It is recorded under shareholders equity on the balance sheet. 10,625 10,028 9,525 9,045 9,552 Cumulative other comprehensive income 242 (10) 307 463 462 Notes receivable from ESOP (1) (1) (3) (3) (4) Treasury stock (690) (643) (522) (651) (561) Total stockholders' equity 22,182 21,375 21,276 20,759 20,558 Total liabilities and stockholders' equity $ 207,060 $ 205,421 $ 201,430 $ 202,475 $ 195,863 Wells Fargo & Company and Subsidiaries SUPPLEMENTAL INFORMATION FIVE QUARTER LOANS (QUARTER ENDED) (in millions) 3Q99 2Q99 1Q99 4Q98 3Q98 Commercial $ 37,222 $ 36,633 $ 35,232 $ 35,450 $ 35,012 Real estate 1-4 family first mortgage 12,375 11,941 12,186 11,496 12,333 Other real estate mortgage 17,653 17,157 16,903 16,668 16,240 Real estate construction 4,381 4,103 3,942 3,790 3,748 Consumer: Real estate 1-4 family junior lien mortgage 12,171 11,494 10,987 11,128 11,057 Credit card 5,347 5,294 5,394 5,795 5,686 Other revolving credit and monthly payment 16,709 16,652 15,333 15,809 16,215 Total consumer 34,227 33,440 31,714 32,732 32,958 Lease financing 7,292 6,875 6,645 6,380 5,994 Foreign 1,559 1,497 1,486 1,478 1,407 Total loans (net of unearned discount) $114,709 $111,646 $108,108 $107,994 $107,692 Wells Fargo & Company and Subsidiaries SUPPLEMENTAL INFORMATION FIVE QUARTER CHANGES IN THE ALLOWANCE FOR LOAN LOSSES (in millions) 3Q99 2Q99 1Q99 4Q98 3Q98 Balance, beginning of quarter $ 3,165 $ 3,161 $ 3,134 $ 3,170 $ 3,098 Allowance related to business combinations, loan losses 240 260 (8) (6) Other real estate mortgage (8) (4) (8) (12) (23) Real estate construction -- (1) -- (1) -- Consumer: Real estate 1-4 family junior lien mortgage (7) (6) (9) (13) (5) Credit card (93) (96) (110) (126) (127) Other revolving credit and monthly payment (122) (109) (127) (509) (158) Total consumer (222) (211) (246) (648) (290) Lease financing (9) (10) (11) (13) (11) Foreign (18) (24) (15) (37) (25) Total loan charge-offs (376) (379) (362) (791) (422) Loan recoveries: Commercial 48 23 13 22 18 Real estate 1-4 family first mortgage 3 2 1 2 4 Other real estate mortgage 4 12 17 10 27 Real estate construction -- 4 -- 1 1 Consumer: Real estate 1-4 family junior lien mortgage 3 4 3 2 1 Credit card 10 13 13 12 14 Other revolving credit and monthly payment 60 53 36 51 31 Total consumer 73 70 52 65 46 Lease financing 3 3 3 2 4 Foreign 4 4 3 3 4 Total loan recoveries 135 118 89 105 104 Total net loan charge-offs (241) (261) (273) (686) (318) Balance, end of quarter $ 3,167 $ 3,165 $ 3,161 $ 3,134 $ 3,170 Total net loan charge-offs as a percentage of average loans (annualized) .85% .96% 1.03% 2.56% 1.18% Allowance as a percentage of total loans 2.76% 2.83% 2.92% 2.90% 2.94% Wells Fargo & Company and Subsidiaries SUPPLEMENTAL INFORMATION FIVE QUARTER NONACCRUAL AND RESTRUCTURED LOANS AND OTHER ASSETS (QUARTER ENDED) (in millions) 3Q99 2Q99 1Q99 4Q98 3Q98 Nonaccrual loans $ 697 $687 $703$ 709 $721 Restructured loans 1 1 1 1 1 Nonaccrual and restructured loans 698 688 704 710 722 As a percentage of total loans .6% .6% .7% .7% .7% Foreclosed assets 213 203 212 167 176 Real estate investments 34 -- 1 1 2 Total nonaccrual and restructured loans and other assets $ 945 $891 $917 $878 $900 Wells Fargo & Company and Subsidiaries SUPPLEMENTAL INFORMATION OPERATING SEGMENT RESULTS (1)(2) Quarter ended (income in millions, Sept. 30, June 30, Mar. 31, Dec. 31, Sept. 30, average balances in billions) 1999 1999 1999 1998 1998 COMMUNITY BANKING Net income $747 $713 $650 $ (124) $ 562 Average loans 67 65 64 Average loans 34 34 Average loans 1 1 -- Net (losses) gains on sales Nine months ended (income in millions, Sept. 30, Sept. 30, average balances in billions) 1999 1998 COMMUNITY BANKING Net income $2,110 $1,500 Average loans 66 64 Average core deposits 113 109 WHOLESALE BANKING Net income $ 641 $ 616 Average loans 34 32 Average core deposits 9 8 NORWEST MORTGAGE Net income $ 208 $ 162 Average loans 1 1 Average core deposits 5 5 Noninterest income Origination and other closing fees $ 330 $ 366 Servicing fees, net of amortization 229 (16) Gains on sales of mortgage servicing rights -- 16 Net (losses) gains on sales of mortgages 194 288 Other 204 198 Total noninterest income $ 957 $ 852 NORWEST FINANCIAL Net income $ 186 $ 161 Average loans 9 9 (1) The differences between the results of the combined operating segments and the consolidated results of the Company consist of unallocated items. (2) Changes in management structure and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. the allocation The apportionment or designation of an item for a specific purpose or to a particular place. In the law of trusts, the allocation of cash dividends earned by a stock that makes up the principal of a trust for a beneficiary usually means that the dividends will be treated as process may result in changes in allocations, transfers and assignments. In that case, results for prior periods would be (and have been) restated to allow comparability. |
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