On a per share basis, the San Francisco-based bank earned $1.01 per share, down from $1.03 per share a year earlier.
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Wells Fargo, along with other banks, felt the blow from low oil prices earlier this year that pushed many energy firms into distress.
The biggest US mortgage lender posted revenue of $22.16 billion in the period, also falling short of Street forecasts. The six banks have delivered an average earnings beat of 4.3 percent and an average revenue beat of 0.9 percent in perhaps the toughest regulatory and interest rate environment in history.
Citigroup’s net income declined from $4.8 billion last year to $4 billion this year.
Income from community banking, Well Fargo’s biggest business, which includes regional banking and consumer and mortgage lending, fell 1 percent to $3.18 billion. Revenue came in at $17.5 billion, matching expectations.
Wells Fargo Advisors chief Mary Mack is moving to the firm’s community-banking division, and the wirehouse is now seeking a new leader, the Wall Street Journal reports.
Stumpf has sought to keep costs in check while amassing more deposits and expanding the bank’s loan portfolio with by purchasing assets from firms including General Electric Co. Almost all that increase came from Wells’ commercial and industrial loan portfolio, which includes its oil and gas loans.
Paul Ashworth the USA economist at Capital Economics noted that retail sales growth figures for April and May were revised upwards by 0.1%, having already been “ridiculously strong”.
Its net interest income grew 4% to $11.73 billion, in part because of loan growth that included assets from its General Electric Co. financial acquisitions in the past year. The bank built up $150 million in reserves in the second quarter, a swing from the $350 million it released in the same period a year ago.
USA retail sales rose more than expected in June as Americans bought motor vehicles and a variety of other goods, reinforcing views that economic growth picked up in the second quarter. That compares with $300 million in the second quarter of 2015 and $1.09 billion in the first quarter of 2016. Wells’ charge-off rate, or the percentage of loans Wells believes are no longer collectible, rose to 0.29 percent from 0.16 percent in a year ago.
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While earnings of S&P 500 companies overall are expected to have fallen 5 percent in the second quarter, growth is expected throughout the remainder of the year.
