Wells Fargo Reports Q4 2025 Profit Amid Loan Growth and Cost Controls

Wells Fargo & Co. reported a net income of $2.1 billion for the fourth quarter of 2025, marking a 12% increase from the same period in 2024. The result surpassed the prior year’s $1.87 billion, reflecting improved margin performance and ongoing cost reduction initiatives. Despite a 2.3% decline in total revenue to $24.4 billion, the bank maintained strong capital adequacy, with a Tier 1 common ratio of 12.4% at quarter-end. The improvement in profitability was primarily fueled by a 6.1% year-over-year increase in net interest income, reaching $17.3 billion. This growth stemmed from a 3.5% rise in the average interest-earning assets, supported by higher yields on loans and investments. Commercial and industrial loan balances grew to $338 billion, up 7.8% from $314 billion in Q4 2024, while consumer loan balances increased by 2.9% to $362 billion. The bank reported a noninterest expense reduction of 4.5% year-over-year, totaling $13.1 billion, as part of its ongoing strategy to streamline operations. However, provision for credit losses rose to $1.5 billion, up from $1.1 billion in the same quarter of the prior year, reflecting increased credit risk in the commercial real estate segment. The allowance for credit losses reached $19.6 billion, equivalent to 4.3% of total loans. The stock responded positively to the earnings report, with shares rising 3.6% in after-hours trading. Investors welcomed the sustained capital strength and loan growth, although concerns lingered over elevated credit costs and the potential for further rate volatility. The results also underscored the bank’s continued efforts to meet regulatory expectations following years of compliance challenges.