Wells Fargo profit slips on lower revenue

Wells Fargo & Co.'s second-quarter net profit fell on lower revenue, but its performance improved in several areas.

The San Francisco-based corporate parent of Wells Fargo Bank Iowa and Wells Fargo Mortgage recorded net income of  $3.06 billion, or 55 cents per share, in the second quarter compared to $3.17 billion,  or 57 cents per share, in the second quarter of 2009.

Revenue slipped to $21.39 billion in the second quarter from $22.51 billion in the same period last year.

Wells Fargo reduced net charge-offs by 16 percent, or $841 million from the prior quarter, to $4.5 billion. The decline was seen in both the consumer and commercial loan portfolios.

Wells Fargo released $500 million, pre-tax, of loan-loss reserves in the second quarter and said it anticipates further reductions in the allowance for bad loans as long as the economy continues to improve.

Average checking and savings deposits were up 10 percent from a year ago and represented 88 percent of total average core deposits of $762 billion.

Wells Fargo Chief Executive Officer John Stumpf said the bank also has made progress in the integration of  Wachovia, completing the California branch integration in April. Wachovia and Wells Fargo offices in Texas and Kansas are scheduled to be integrated Saturday, July 24.