Gains in mortgages and other lending helped Wells Fargo, the nation’s No. 2 mortgage lender, produce a 13 percent jump in quarterly profit, helping offset losses from consumer bankruptcies and Hurricane Katrina, the company said today.

Mortgage banking revenue nearly tripled amid a surge in home loans, Wells Fargo reported today, helping the company score net income of $1.98 billion for the third quarter, or $1.16 a share. A group of analysts polled by Thomson Financial had predicted that the company would report $1.15 a share.

Almost every one of the company’s consumer and commercial business lines achieved double-digit profit growth, the company said. Wells Fargo also fared better than most of its rivals in keeping its lending margins from shrinking.

Net income in the third quarter rose to $1.98 billion, or $1.16 per share, from $1.75 billion, or $1.02, a year earlier. Earnings per share have increased at least 10 percent in 15 of the last 16 quarters. The company’s revenue rose 16 percent to $8.5 billion.

Mortgage banking revenue totaled $743 million, as residential originations surged 51 percent to $103 billion and applications rose 40 percent to $116 billion.

“People have been predicting the end of the mortgage cycle every quarter for eight quarters,” Chief Financial Officer Howard Atkins said in an interview. “But interest rates remain at relatively low levels, and consequently the mortgage business remains robust.”

Even so, Wells Fargo set aside $100 million for damage caused by Katrina, which makes mortgage payment defaults more likely, and said it may set aside more. Wells Fargo is the second-largest U.S. mortgage lender.

The company’s stock was trading at $59.02 shortly before noon Eastern time today, down 12 cents from its opening price this morning.

***

What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Show Comments Hide Comments

Comments

Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
Limited time: Get 30 days of Inman Select for $5.SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription