Wells Fargo profit rises on higher commercial, industrial loans

Wells Fargo, the biggest U.S. mortgage lender, reported a slight increase in quarterly profit as it lent more to commercial and industrial customers.

Wells Fargo's total loans rose 2.8 percent to $862.6 billion in the fourth quarter.

The bank's commercial and industrial lending rose 15.5 percent rise, while its credit card loans increased 16 percent.

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Mortgage lending, however, fell to $44 billion from $50 billion a year earlier and $48 billion in the third quarter.

Wells Fargo shares were down 1.5 percent in premarket trading on Wednesday. (Get the latest quote here.)

Net income applicable to the bank's common shareholders rose to $5.38 billion, or $1.02 per share, from $5.37 billion, or $1.00 per share, a year earlier.

Well Fargo's net interest income rose 3.5 percent to $11.2 billion due to growth in total loans and higher income from investments and trading assets.

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Revenue increased 3.3 percent to $21.4 billion.

Analysts on average had estimated earnings of $1.02 per share and revenue of $21.23 billion, according to Thomson Reuters I/B/E/S.

Wells Fargo had mortgage applications of $26 billion in the pipeline at the end of the fourth quarter, compared with $25 billion at the end of the prior quarter.

JPMorgan Chase reported on Wednesday a 6.6 percent drop in quarterly profit as legal costs exceeded $1 billion in the wake of government probes into alleged wrongdoing and revenue from fixed-income trading fell.

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Up to Tuesday's close, Wells Fargo's stock had risen about 14 percent in the past 12 months, while the KBW index of bank stocks had fallen 1.7 percent.