Wells Fargo Mortgage Banking Falls Short Even With Low Mortgage Rates and Increased Refinance Activity
Posted on | July 28, 2010 | No Comments
Wells Fargo has seen a drop of 12% over the last three months when it comes to its stock price. In an earnings report that was released on July 21st, the San Francisco based bank reported that mortgage banking fell short of forecasts. Even though mortgage rates are extremely low and refinance activity is beginning to pick up it seems to be the case that the demand for new home purchases has been lackluster.
To make matters even worse for Wells Fargo investors, the CEO recently decided to sell $3 million in shares. It is very important to point out that John Stumpf sold 110,000 shares but still holds 688,933 shares and 5.6 million exercisable options. A representative of Wells Fargo states that the time of the sale was personal and has nothing to do with earnings or the financial regulatory bill that was recently signed by President Obama.
Wells Fargo is currently one of the big four banks in America along with Bank of America, JP Morgan Chase and Citigroup. Over the last several years these four banks have seen big losses when it comes to bad credit loans but they are looking to clean up their balances sheets and move forward with profitable quarters. The S&P Banks Index has been down 11% in the last three months while the benchmark S&P 500 has only been down 6%.
Author: Jeremy North
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