Kroll Bond Rating Agency Releases Comment on Wells Fargo & Company’s Energy Exposure and Fourth Quarter Results
Kroll Bond Rating Agency (KBRA) released a comment on Wells Fargo &
Company, Inc.’s energy exposure and earnings results. The comment makes
the following key points:
Wells Fargo & Company, Inc. (NYSE:WFC, or “Wells”) reported
its fourth quarter 2015 earnings, indicating positive operating
results despite challenges in the energy lending portfolio.
WFC reported $17 billion of energy loans, approximately 2% of total
As with the rest of the industry, provisions continued to increase due
to challenges associated with the energy sector.
Some $118 million was reported in oil and gas loan defaults with
losses expected to grow in 2016, impacting Wells’ overall C&I lending
In KBRA’s view, WFC‘s exposure to the energy sector may adversely
impact asset quality and earnings in 2016 due to the sector’s price
volatility, though this increased credit expense may be partially
offset by higher CRE and consumer loan yields.
The rating outlook for WFC remains Stable. Potential energy problems
are expected by KBRA to remain well contained with solid overall
financial and asset quality metrics.
To view the full comment, please use the following link: www.krollbondratings.com/show_report/3641
About Kroll Bond Rating Agency
KBRA is registered with the U.S. Securities and Exchange Commission as a
Nationally Recognized Statistical Rating Organization (NRSRO). In
addition, KBRA is recognized by the National Association of Insurance
Commissioners (NAIC) as a Credit Rating Provider (CRP).
View source version on businesswire.com: http://www.businesswire.com/news/home/20160120006389/en/
Copyright Business Wire 2016
Source: Business Wire
(January 20, 2016 - 3:21 PM EST)
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