NEW YORK — Wells Fargo gave anxious investors a pleasant surprise Wednesday, reporting a profit drop that was milder than anticipated and lifting its quarterly dividend by 10 percent.
Wells Fargo’s second-quarter profit fell 22 percent as more customers at the nation’s fifth-largest and Colorado’s largest bank failed to pay back their loans. But it raised its dividend to 34 cents from 31 cents — at a time when many other financial institutions are slashing theirs to preserve capital.
The San Francisco-based company’s shares soared $6.72, or 32.8 percent, to close at $27.23 Wednesday, after tumbling alongside other financial stocks over the past several days on worries about more U.S. mortgage losses and bank failures.
Wells Fargo has now logged three straight quarters of declines in profits. But the bank has been weathering one of the nation’s worst credit crises much better than most of its competitors, in part because it had less exposure to the subprime mortgages whose failure undermined the financial sector.
Wells Fargo & Co. earned $1.75 billion, or 53 cents per share, in the April-to-June period, down from $2.28 billion, or 67 cents per share, in the same time frame last year.
This article has been corrected in this online archive. Originally, due to an editing error, its headline incorrectly characterized Wells Fargo’s second-quarter financial results. The company had a decline in profit, not a loss.
