01—Abstract
Summary
Summary of the 10-K filed February 25, 2025. Cited figures are marked; the original filing is the authoritative source.
Wells Fargo's 2024 Form 10-K (filed February 25, 2025) shows a company that remained profitable and well capitalized while still working through regulatory remediation.
Net income was $19.7 billiona ($5.37 diluted EPS), up from $19.1 billion ($4.83) in 2023, but total revenue was roughly flat at $82.3 billion. Net interest income fell 9% to $47.7 billion as deposit costs rose and loan balances declined, and that decline was offset by a 15% increase in noninterest income to $34.6 billion, driven by investment advisory fees, trading gains, and investment banking. Noninterest expense fell 2% to $54.6 billion, helped by lower FDIC special assessment expense, although operating losses rose 49% on customer remediation and legal costs.
Credit quality was mixed. Net charge-offs rose to $4.8 billionb, led by credit card losses and commercial real estate office exposure. The allowance for credit losses for loans declined slightly to $14.6 billion (1.60% of loans), and nonperforming assets fell 6% to $7.9 billion.
Capital and liquidity remained strong, with a CET1 ratio of 11.07% against a 9.80% requirement, a TLAC ratio of 24.83%, and an LCR of 125%. Share repurchases totaled $19.6 billionc in 2024, and the company's $30 billion buyback authorization had about $7.3 billion remaining at year-end. The filing also highlights ongoing regulatory constraints.
The 2018 Federal Reserve consent order still caps total assets at the December 31, 2017 level, and the company faces a September 2024 OCC formal agreement on anti-money laundering and sanctions. During 2024 the OCC terminated the 2018 CFPB/OCC compliance consent order, and the CFPB terminated its 2022 consent order in January 2025. Management's remediation work is therefore still in progress, and the timing of the asset cap's removal remains a key uncertainty for growth.
02—Key points
Key Highlights
- Net income rose 3% to $19.7 billion, and diluted EPS rose 11% to $5.37, supported by higher noninterest income and lower noninterest expense.
- Net interest income fell 9% to $47.7 billion, with net interest margin compressing to 2.73% from 3.06% as deposit costs increased and loan balances declined.
- Noninterest income rose 15% to $34.6 billion, led by investment advisory fees (+13%), investment banking fees (+62%), and trading gains (+10%).
- Credit costs increased: net charge-offs rose 38% to $4.8 billion, driven by credit cards and commercial real estate office loans, while nonperforming assets declined 6% to $7.9 billion.
- Capital and liquidity remained strong, with CET1 at 11.07% (vs. 9.80% requirement), TLAC at 24.83%, and LCR at 125%; the company returned capital through $19.6 billion of buybacks and $6.2 billion of dividends.
- The 2018 Federal Reserve asset cap remains in effect, limiting total consolidated assets to the December 31, 2017 level until remediation requirements are satisfied.
- Operating losses rose 49% to $1.8 billion on higher customer remediation ($722 million) and legal expenses, and the FDIC special assessment added $243 million in 2024.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2024filed February 25, 2025Financial Statements
FY2024 against FY2023
| Line item | FY2024FY2023 | Change |
|---|---|---|
| Net Income | $19.72B$19.14B | +3.0% |
| EPS (Basic) | $5.43$4.88 | +11.3% |
| EPS (Diluted) | $5.37$4.83 | +11.2% |
| Shares Outstanding (Basic) | 3.43B3.69B | −7.1% |
| Shares Outstanding (Diluted) | 3.47B3.72B | −6.8% |
05—Questions
Frequently Asked Questions
Why did net income increase while net interest income fell?
Net interest income declined $4.7 billion because deposit costs rose faster than asset yields and average loan balances fell. Net income still increased by $580 million because noninterest income rose $4.4 billion, provision for credit losses fell $1.1 billion, and noninterest expense fell $1.0 billion. Lower FDIC special assessment expense and lower professional services spending drove most of the expense reduction.
What regulatory constraints still limit Wells Fargo's growth?
The February 2018 Federal Reserve consent order caps consolidated assets at the December 31, 2017 level until the Board's governance and the compliance and operational risk plans are accepted and independently reviewed. The September 2024 OCC formal agreement on anti-money laundering and sanctions is also ongoing. Management states that it has not yet satisfied all aspects of these actions, and it may face additional fines or restrictions if issues are not resolved on time.
How strong is the company's capital position?
At December 31, 2024, the Standardized CET1 ratio was 11.07%, above the 9.80% requirement, which includes a 3.80% stress capital buffer and a 1.50% G-SIB surcharge. Tier 1 leverage was 8.08%, and the supplementary leverage ratio was 6.74%. Book value per share was $48.85, up from $46.25. The company remains well capitalized, though its ability to repurchase shares depends on future stress test results and regulatory capital rules.
Which areas drove credit losses and what is the outlook?
Net loan charge-offs were $4.8 billion, or 0.52% of average loans. Commercial charge-offs rose to 0.29% of average commercial loans, mainly due to office properties in commercial real estate, and consumer charge-offs rose to 0.85%, mainly due to credit cards. The allowance for loan losses covers 1.55% of total loans. Management's base scenario assumed slowing growth and rising unemployment, and its downside scenarios assumed a more significant contraction, so further deterioration in CRE and card credit is a key risk to monitor.
06—Continue