Noninterest income was $10.4 billion, up from $10.0 billion in second quarter 2015, driven by higher equity investment gains, deposit service charges, lease income and card fees. Net interest income increased $187 million from second quarter 2015 to $11.5 billion, primarily driven by growth in investment securities and loans, including the full-quarter benefit of the GE Capital loan purchase and related financing transaction that settled late in the second quarter.
In the third quarter, the company had a 1.32% return on assets and a 12.62% return on equity. Currently, the Common Equity Tier 1 ratio under Basel III (fully phased-in) is 10.7%.
The quarter-end loans totaled $903.2 billion, up $64.4 billion (8%), while total average deposits totaled $1.2 trillion, up $71.8 billion (6%) from the previous year. During this quarter, the allowance for credit losses, including the allowance for unfunded commitments, totaled $12.6 billion as well.
John Stumpf, chairman and CEO of Wells Fargo, commented on earnings:
Wells Fargo’s 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.
Shares of Wells Fargo closed Tuesday down 0.6% at $51.86, with a consensus analyst price target of $59.02 and a 52-week trading range of $46.44 to $58.77. In early trading indications on Wednesday, shares were down 0.7% at $51.49.
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