Wells Fargo & Co. recorded a 20% spike in its fourth-quarter 2011 profits, due in large part to its mortgage financing business.
The San Francisco-based company originated $120 billion in mortgages in the fourth quarter, up from $89 billion in the third quarter of 2011. The company's net interest margin was 3.89% in the fourth quarter, up from 3.84% in the previous quarter. Overall, Wells Fargo's net income rose to $4.11 billion, up from $3.41 billion in the fourth quarter of 2010.
‘The fourth quarter of 2011 was a very strong quarter for Wells Fargo, with record earnings, solid linked quarter growth in loans, deposits and capital, and continued strong credit quality,’ says Chief Financial Officer Tim Sloan. ‘Revenue was up 5 percent from the third quarter despite a full quarter's impact of the new debit interchange rules. As expected, expenses were higher in the quarter, and we are maintaining our target of $11 billion in non-interest expense in the fourth quarter of 2012.’