The Wall Street Journal: Wells Fargo expects declines in business loans

Wells Fargo is having a tough time growing its loan book. The drumbeat of negative news around its governance issues is one reason for its struggles, and shooting the messenger won’t help.

Chief Financial Officer John Shrewsberry said at a conference on Friday that he expects two key classes of business loans, commercial real estate and commercial and industrial loans, to fall from second-quarter levels, although he didn’t specify an exact time frame. Wells Fargo’s WFC, -0.49%   total loans outstanding at the end of the second quarter were down by $3 billion compared with the prior quarter, driven by declines in consumer and commercial real-estate loans. Commercial and industrial loans rose.

Several midsize regional lenders also warned of soft lending this week, which hit their share prices. But most merely cited a slowdown, not an outright decline. Wells Fargo’s big bank peers C, +0.56%  and JPMorgan Chase JPM, -0.02%   actually gave upbeat lending outlooks.

Mr. Shrewsberry cited a host of factors, including deliberate lending discipline, strong capital markets that provide an alternative funding source and a competitive environment, including from nonbank lenders. But he also acknowledged for the first time that reputational issues may be hurting its commercial-lending business, not just the consumer business where the impact has long been obvious.

An expanded version of this report appears on WSJ.com.

Also popular on WSJ:

Manafort Pleads Guilty, Will Cooperate with Mueller Probe

Henri Bendel to Close After 123 Years

Filed in: Top News Tags: 

You might like:

The Ratings Game: Walgreens stock dives after Goldman downgrade on concerns about core business The Ratings Game: Walgreens stock dives after Goldman downgrade on concerns about core business
Futures Movers: Oil ends lower for the week; natural gas sees biggest weekly plunge since 2016 Futures Movers: Oil ends lower for the week; natural gas sees biggest weekly plunge since 2016
Market Extra: Individual investors are the most bearish since 2013: survey Market Extra: Individual investors are the most bearish since 2013: survey
Metals Stocks: Gold falls as haven buying lifts U.S. dollar, pushing metal’s price down for the week Metals Stocks: Gold falls as haven buying lifts U.S. dollar, pushing metal’s price down for the week
Week of Sandy Hook anniversary brings CDC data showing 2017 gun deaths at highest level in nearly 40 years Week of Sandy Hook anniversary brings CDC data showing 2017 gun deaths at highest level in nearly 40 years
Trump Today: Trump Today: President suggests China trade deal could happen soon as he praises Apple for expanding in U.S. Trump Today: Trump Today: President suggests China trade deal could happen soon as he praises Apple for expanding in U.S.
Johnson & Johnson’s stock slammed after report it knew of asbestos in baby powder Johnson & Johnson’s stock slammed after report it knew of asbestos in baby powder
Bond Report: Treasurys rally after soft China data sends global stocks lower Bond Report: Treasurys rally after soft China data sends global stocks lower

Leave a Reply

Submit Comment
© 2018 Stock Investors News. All rights reserved. XHTML / CSS Valid.