Wells Fargo results top forecasts, shares rise

NEW YORK (Reuters) – Wells Fargo & Co (WFC.N), the

fifth-largest U.S. bank, reported better-than-expected

quarterly results on Wednesday and raised its dividend despite

a 23 percent decline in profit caused by deteriorating credit.

Net income for the San Francisco-based bank fell to $1.75

billion, or 53 cents per share, from $2.28 billion, or 67

cents, a year earlier. Revenue increased 16 percent to $11.5

billion.

Analysts on average expected profit of 49 cents per share

on revenue of $10.7 billion, according to Reuters Estimates.

Shares of the bank rose 12.7 percent to $23.12 in

pre-market electronic trading.

Wells Fargo more than quadrupled the amount it set aside

for credit losses to $3.01 billion from $720 million a year

earlier, and net loan charge-offs more than doubled to $1.51

billion.

The company nevertheless increased its quarterly dividend

to 34 cents per share from 31 cents, bucking the trend among

many rivals that are lowering their payouts.

“We’re still affected by the weak economy, but we believe

we’re one of the best positioned in financial services to grow

through this adversity,” Chief Executive John Stumpf said in a

statement. “We are open for business and getting lots of it.”

Billionaire Warren Buffett’s Berkshire Hathaway Inc

(BRKa.N) (BRKb.N) is Wells Fargo’s largest investor, owning 8.8

percent of its stock as of March 31, Thomson ShareWatch said.

Through Tuesday, Wells Fargo shares had fallen 32.1 percent

this year, compared with a 45.3 percent decline in the KBW Bank

Index (.BKX).

(Reporting by Jonathan Stempel; Editing by Dave Zimmerman)