By Ben Eisen
Wells Fargo & Co. said Tuesday that fourth-quarter profit sank 53%.
The bank's quarterly earnings totaled $2.87 billion, versus $6.06 billion a year earlier. Per-share earnings of 60 cents missed the $1.12 expected by analysts polled by FactSet.
Revenue of $19.9 billion was down from $21 billion a year ago. Analysts had expected $20.1 billion.
The lender took a financial hit related to the fake-account scandal that has dogged Wells Fargo since 2016. The company booked a $1.5 billion charge for legal costs related to its long-running sales-practices problems.
The quarter also marked the start of the tenure of Charles Scharf, who joined Wells Fargo as CEO in October. He has been tasked with resolving a pile of outstanding regulatory issues and improving the San Francisco-based bank's reputation, which was hit hard by a scandal involving fake customer accounts.
Behind the scenes, Wells Fargo's business lines have also been struggling. Revenue declines have forced the bank to refocus on cutting costs.
The Federal Reserve cut interest rates three times last year, adding pressure on the banking sector by crimping what banks can charge on loans.
Net interest income fell 11% from $12.6 billion in the year-ago quarter.
Noninterest income, which is more protected from rate fluctuations, rose 4% from $8.3 billion a year ago.
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(END) Dow Jones Newswires
January 14, 2020 08:25 ET (13:25 GMT)Copyright (c) 2020 Dow Jones & Company, Inc.