Wells Fargo 4Q16 Earnings Call Notes

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Wells Fargo’s (WFC) CEO Tim Sloan on Q4 2016 Results

Results for 2016

“But first I want to summarize our financial performance for the past year. We generated earning of $21.9 billion and EPS of $3.99 a share. We grew revenue by 3% including 5% growth in net interest income. Average loans grew $64.5 billion, up 7% and average deposits increased $56.5 billion, up 5%.”

Things have changed on efficiency ratio

“So, John I’ll start and then you jump in. I think Ken the efficiency ratio metrics that we set out at our Investor Day last year are really guidelines for us to operate in in the environment that we expected to turn the clock back to last May. We think that 55% to 59% range is best-in-class in the industry and the range that we’re expecting to operate in for the next couple of years. Things have changed clearly, and expectations have changed, but the efficiency ratio is a function of not only your expense rate, but also revenue growth and we’re hopeful that we’ll continue to grow revenue overtime as we did over the last year in 2016.”

John Shrewsberry

Lower point in the refi cycle

“Sure. The big sources, setting mortgage aside because we talked about it a little bit in the prepared comments and I think you just nailed it, we’re in that lower point in the refi cycle. So it’s really about getting after the purchase needs of our customers and then those refi that do come up, but applications are down across the industry and I think people expect that in general. So what that yields will depend on the path of where rates go, how jobs are formed and what the demand is for home buying.”