(Reuters) - Wells Fargo & Co (WFC.N) is “well positioned” for upcoming stress tests of the largest U.S. banks, Chief Executive John Stumpf said on Tuesday.
The fourth-largest U.S. bank looks forward to returning more capital to shareholders next year, Stumpf said at a Goldman Sachs financial services conference in New York. He did not provide specifics on the bank’s plans.
Wells is one of six large U.S. banks that will face additional scrutiny of their exposure to the European debt crisis.
The bank has no “sovereign claims” against the five countries at the center of the crisis, Stumpf said. The bank’s “gross outside exposure” to those five countries was $3.1 billion at the end of the third quarter, he said.
Wells had total loans of $760 billion at the end of the third quarter.
The Federal Reserve plans to release results of the stress tests in March.
In the fourth quarter, Wells expects higher mortgage fee income, but also expects higher noninterest expenses from the mortgage business and its 2008 acquisition of financial services company Wachovia, Stumpf said.
Analysts surveyed by Thomson Reuters I/B/E/S estimate that Wells Fargo will earn 72 cents per share in the fourth quarter, up from 61 cents a year earlier.
Wells Fargo continues to adjust to regulations that have crimped revenue from consumer banking, Stumpf said.
To cover the $200 to $300 it costs to provide a checking account, the bank is encouraging customers to do more business with the bank by offering packages of products and services, he said.
Some customers, however, do not pay that way and the bank is testing monthly charges for them, he said. Customers, though, have clearly said they do not want to pay a monthly debit card fee, he said.
Wells canceled a test of a $3 monthly debit fee in October, joining other banks who backed off such charges after a backlash from consumers and lawmakers.
Reporting by Rick Rothacker in Charlotte, North Carolina; editing by John Wallace and Andre Grenon