Wells Fargo anticipates loan growth in 2026 to exceed its prior projections, signaling a healthy U.S. economy characterized by robust spending and stable credit conditions, according to Chief Financial Officer Mike Santomassimo. His remarks, delivered at an investor conference on Tuesday, offered an optimistic outlook that helped temper concerns over rising fuel prices and increased borrowing costs stemming from Middle East conflicts.
"Debt-to-income levels are quite good overall," Santomassimo stated at the Barclays Global Financial Services Conference. He further noted that the economy is expanding and that the bank is not observing any degradation in delinquency trends. In the second quarter, Wells Fargo reported an average loan increase of approximately 12%. The bank had previously forecast mid-single-digit percentage loan growth for the full year 2026.
Santomassimo reaffirmed the bank's full-year financial forecasts for net interest income (NII) and expenses. Wells Fargo projects NII, the difference between interest earned on loans and paid on deposits, to be around $50 billion, with expenses projected at approximately $55.7 billion. The net interest margin for the third quarter is also expected to surpass initial expectations, he added.
The financial industry is closely monitoring these industry conferences for insights into deal pipelines and updates on consumer health from major U.S. banking institutions. "We're going to continue to invest in covering different subsectors within places like healthcare, TMT, and other parts," Santomassimo commented, indicating strategic investments in key business areas.
Wells Fargo has been actively expanding its investment banking and trading operations to compete more effectively with rivals on Wall Street. The bank anticipates a mid-single-digit percentage increase in investment banking fees for the third quarter, with similar growth expected in market revenue and trading activities. This contrasts with Bank of America CEO Brian Moynihan's recent prediction that his bank's investment banking fees might decline by at least 10% in the third quarter, with sales and trading revenue expected to remain relatively flat.
Regarding potential acquisitions, Santomassimo indicated that Wells Fargo might consider expanding capabilities in payments or technology, though he emphasized a stringent evaluation process, stating there is a "high bar."