Wells Fargo's profit falls 6.4%

[NEW YORK] Wells Fargo & Co, the largest US mortgage lender, reported its fifth straight decline in quarterly profit on Friday as it tries to recover from a bogus-accounts scandal.

The San Francisco-based bank has been dealing with multiple lawsuits and a sharp drop in account openings after it settled with regulators in September over charges that its employees created 2 million accounts without customers' consent.

Net income applicable to shareholders fell 6.4 per cent to US$4.87 billion, or 96 cents per share, in the fourth quarter ended Dec 31, from US$5.20 billion, or US$1.00 per share, a year earlier.

Analysts on average had expected the bank to earn US$1.00 per share, according to Thomson Reuters I/B/E/S. It was not immediately clear if the reported figures were comparable.

The bank set aside US$805 million to cover potential loan losses, down 3.1 per cent from a year earlier.

The results were for the first full quarter under Chief Executive Timothy Sloan, who took over after John Stumpf resigned in the wake of the scandal.

Bank of America Corp, the second-largest US bank, kicked off the quarterly earnings period for big US lenders earlier on Friday, announcing a 46.8 per cent rise in profit.

REUTERS