Wells Fargo mpany : Q3 2022 presentation

3Q22 Financial Results

October 14, 2022

© 2022 Wells Fargo Bank, N.A. All rights reserved.

3Q22 results

Financial Results

ROE: 8.0%

ROTCE: 9.6%1

Efficiency ratio: 73%2

Credit Quality

Capital and Liquidity

CET1 ratio: 10.3%3

LCR: 123%4

TLAC ratio: 23.0%5

• Net income of $3.5 billion, or $0.85 per diluted common share, included $(2.0) billion, or $(0.45) per share, of accruals primarily related to a variety of historical matters, including litigation, customer remediation, and regulatory matters
• Revenue of $19.5 billion, up 4% on strong net interest income
• • Businesses divested in 2021 accounted for $459 million of revenue in 3Q21
• Noninterest expense of $14.3 billion, up 8% and included operating losses of $2.2 billion, up $1.7 billion
• • Businesses divested in 2021 accounted for ~$305 million of noninterest expense in 3Q21
• Effective income tax rate of 20.2%
• Average loans of $945.5 billion, up 11%
• Average deposits of $1.4 trillion, down 3%
• Provision for credit losses of $784 million
• • Total net charge-offs of $399 million, up $142 million, with net loan charge-offs of 0.17% of average loans (annualized)
  • Allowance for credit losses of $13.2 billion, down $1.5 billion from 3Q21 and included a $385 million increase in 3Q22
• Common Equity Tier 1 (CET1) capital of $129.8 billion3
• CET1 ratio of 10.3% under the Standardized Approach and 11.7% under the Advanced Approach3

Comparisons in the bullet points are for 3Q22 versus 3Q21, unless otherwise noted.

1. Tangible common equity and return on average tangible common equity (ROTCE) are non-GAAP financial measures. For additional information, including a corresponding reconciliation to GAAP financial measures, see the "Tangible Common Equity" table on page 16.
2. The efficiency ratio is noninterest expense divided by total revenue.
3. The Common Equity Tier 1 (CET1) ratio calculated under the Standardized Approach is our binding CET1 ratio. See page 17 for additional information regarding CET1 capital and ratios. CET1 is a preliminary estimate.
4. Liquidity coverage ratio (LCR) represents average high-quality liquid assets divided by average projected net cash outflows, as each is defined under the LCR rule. LCR is a preliminary estimate.
5. Represents TLAC divided by risk-weighted assets (RWAs), which is our binding TLAC ratio, determined by using the greater of RWAs under the Standardized and Advanced Approaches. TLAC is a preliminary estimate.

3Q22 Financial Results

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Capital

Common Equity Tier 1 Ratio under the Standardized Approach 1

11.6%	11.4%
		10.5%	10.4%	10.3%
				9.1%
				Regulatory
				Minimum
				and Buffers2
3Q21	4Q21	1Q22	2Q22	3Q22
				Estimated

Capital Position

• Common Equity Tier 1 (CET1) ratio of 10.3%1 at September 30, 2022 remained above our regulatory minimum and buffers of 9.1%2
• CET1 ratio down ~130 bps from 3Q21 and down ~10 bps from 2Q22 and reflected:
• • Declines in accumulated other comprehensive income driven by higher interest rates and wider agency mortgage-backed securities spreads resulted in declines in the CET1 ratio of 96 bps from 3Q21 and 21 bps from 2Q22
• As of 10/1/22, the Company's stress capital buffer (SCB) increased to 3.2%, which increased our CET1 regulatory minimum and buffers to 9.2%

Capital Return

• Period-endcommon shares outstanding down 201.5 million, or 5%, year-over- year (YoY)
• 3Q22 common stock dividend increased to $0.30 per share, up from $0.25 per share in 2Q22
• No common stock repurchases in 3Q22

Total Loss Absorbing Capacity (TLAC)

• As of September 30, 2022, our TLAC as a percentage of total risk-weighted assets was 23.0%3 compared with the required minimum of 21.5%
• Issued $9.7 billion of Wells Fargo & Company (parent) senior, unsecured long- term debt in the quarter

1. The Common Equity Tier 1 (CET1) ratio calculated under the Standardized Approach is our binding CET1 ratio. See page 17 for additional information regarding CET1 capital and ratios. 3Q22 CET1 is a preliminary estimate.
2. Includes a 4.50% minimum requirement, a stress capital buffer of 3.10%, and a G-SIB capital surcharge of 1.50%.
3. Represents TLAC divided by risk-weighted assets (RWAs), which is our binding TLAC ratio, determined by using the greater of RWAs under the Standardized and Advanced Approaches. TLAC is a preliminary estimate.

3Q22 Financial Results

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3Q22 earnings

$ in millions (mm), except per share data	3Q22		2Q22	3Q21	vs. 2Q22		vs. 3Q21
Net interest income	$12,098		10,198	8,909	$1,900		3,189
Noninterest income	7,407		6,830	9,925	577		(2,518)
Total revenue	19,505		17,028	18,834	2,477		671
Net charge-offs	399		345	257	54		142
Change in the allowance for credit losses	385		235	(1,652)	150		2,037
Provision for credit losses	784		580	(1,395)	204		2,179
Noninterest expense	14,327		12,883	13,303	1,444		1,024
Pre-tax income	4,394		3,565	6,926	829		(2,532)
Income tax expense	894		613	1,521	281		(627)
Effective income tax rate (%)	20.2	%	16.4	22.9	379	bps	(268)
Net income	$3,528		3,119	5,122	$409		(1,594)
Diluted earnings per common share	$0.85		0.74	1.17	$0.11		(0.32)
Diluted average common shares (# mm)	3,825.1		3,819.6	4,090.4	6		(265)
Return on equity (ROE)	8.0 %	7.1	11.1	84	bps	(307)
Return on average tangible common equity (ROTCE)1	9.6		8.6	13.2	98		(361)
Efficiency ratio	73		76	71	(220)		282

1. Tangible common equity and return on average tangible common equity are non-GAAP financial measures. For additional information, including a corresponding reconciliation to GAAP financial measures, see the "Tangible Common Equity" table on page 16.

3Q22 Financial Results

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Credit quality

Provision for Credit Losses and Net Charge-offs($ in millions)

Allowance for Credit Losses for Loans ($ in millions)

257

0.12%

(1,395)

423

0.19%

(452)

305

0.14%

(787)

345

580

0.15%

399

784

0.17%

14,705 13,788

6,1405,997

1.70%	1.54%
8,565	7,791

12,681

5,533

1.39%

7,148

12,884

5,802

1.37%

7,082

13,225

6,234

1.40%

6,991

3Q21	4Q21	1Q22	2Q22	3Q22
	Provision for Credit Losses	Net Charge-offs

3Q214Q21

1Q22

2Q22

3Q22

Net Loan Charge-off Ratio

• Commercial net loan charge-offs down $17 million to 0 bps of average loans (annualized)
• Consumer net loan charge-offs up $72 million to 40 bps of average loans (annualized) driven by a $53 million increase in net loan charge-offs in the auto portfolio
• Nonperforming assets decreased $411 million, or 7%, on a $374 million decline in residential mortgage nonaccrual loans primarily due to sustained payment performance of borrowers after exiting COVID-19-relatedaccommodation programs

Comparisons in the bullet points are for 3Q22 versus 2Q22, unless otherwise noted. 3Q22 Financial Results

Commercial		Consumer		Allowance coverage for total loans

• Allowance for credit losses for loans increased reflecting loan growth and a less favorable economic environment
• • Allowance coverage for total loans up 3 bps from 2Q22 and down 30 bps from 3Q21

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