Wells Fargo Reports Lower Q1 Earnings as Net Interest Income Falls [Video]

Wells Fargo (WFC) reported a 7% decline in first-quarter profit as high funding costs and lower loan balances took a bite out of net interest income.

The bank reported revenue of $20.86 billion, up slightly from a year earlier and ahead of analysts’ expectations, according to estimates compiled by Visible Alpha. Net income came in at $4.62 billion, while diluted earnings per share were $1.20, results that were down from a year ago but well ahead of expectations.

Chief Executive Officer Charlie Scharf said in a press release that the Wells Fargo’s investments across the business contributed to higher revenue and that “an increase in non-interest income more than offset an expected decline in net interest income.”

Net interest income—which measures the profitability of lending versus the amount paid out to depositors and account holders—fell 8% from the first quarter of last year to $12.23 billion, which was slightly below the consensus view of …