Investing.com -- Wells Fargo reported third-quarter earnings that beat analyst expectations on Friday, sending its shares up 3% in early trading.
The bank posted adjusted earnings per share of $1.42, surpassing the consensus estimate of $1.28. Revenue came in at $20.37 billion, slightly below the $20.39 billion analysts had projected.
Net income fell to $5.1 billion from $5.8 billion during the same period last year, following a 2% YoY decline in total revenue. The bank's results were boosted by lower expenses and credit costs.
"We had solid results in the third quarter with both net income and diluted earnings per share up from the second quarter," said CEO Charlie Scharf in a statement.
Wells Fargo's net interest income fell 11% YoY to $11.69 billion, reflecting higher funding costs as customers shifted to higher-yielding deposit products. However, this was partially offset by a 12% increase in noninterest income to $8.68 billion.
"Our revenue sources are more diverse and fee-based revenue grew 16% during the first nine months of the year, largely offsetting net interest income headwinds," said Scharf.
The bank's efficiency ratio, a measure of costs as a percentage of revenue, held steady at 64% compared to the previous quarter.
Wells Fargo maintained a strong capital position, with its Common Equity Tier 1 ratio rising to 11.3% from 11.0% in the prior quarter.
"Our strong capital position enables us to continue investing in our businesses and we have consistently returned excess capital to our shareholders," Scharf added.