Wells Fargo 2018 earnings meet analyst estimates with net income up by 1% to $22.4bn.

But Wells Fargo’s Q4 net income inches down to $6.2bn from $6.1bn in the year ago quarter. In addition, Wells Fargo’s Q4 revenue is down by 5%.

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Notably, Q4 profit at Wells’ retail banking focused Community Banking unit is down by 9% y-o-y to $3.17bn.

Wells continues to suffer reputational issues relating to miss-selling within its retail banking unit that came to light in Q316.

Average loans of $946bn are down by 1% and average deposits down by 3% to $1.3trn.

Wells Fargo will continue to operate under the Fed’s growth cap until the end of 2019.

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Wells Fargo 2018 earnings: more positive metrics

The bank’s 23.9 million primary consumer checking customers is up 1.2% from a year ago.

Rightsizing continues within Wells Fargo’s retail banking branch network. Wells ends 2018 with 5,518 branches, down by 300 units during the year.

Other highlights include:

  • Small Business Lending originations of $595m, up 19% year-on-year;
  • Debit card point-of-sale purchase volume is up 8% y-o-y;
  • Wells’ efficiency ratio improved to 65.0% from 66.2% a year ago;
  • Wells’ net interest margin improved by 10 basis points y-o-y to 2.94%, and
  • Active mobile banking customer numbers increase 1 million to 22.8 million.

Wells Fargo says that it met its 2018 expenses target and is on target to meet its 2019 expenses target. In particular, Wells reduced headcount by 4,000 or around 1.5% of FTEs to 258,000.

CEO Tim Sloan says:  “I’m proud of the transformational changes we made at Wells Fargo during 2018 including significant progress on our six goals. We have made meaningful improvements to how we manage risk particularly operational and compliance risk.

“We improved customer service. This resulted in Customer Loyalty’ and ‘Overall Satisfaction with Most Recent Visit’ branch survey scores reaching 24-month highs in December.”

“We launched many customer-focused innovations including online mortgage applications, Control Tower, Pay with Wells Fargo, and our new Propel Card.”

Control Tower gives customers a single view of their ‘digital financial footprint’. This includes places their Wells Fargo card or account information is connected such as recurring payments mobile wallet devices and subscriptions.

Wells ended the year with a market cap of around $229bn, its share price down by 16% during 2018.