Wachovia profits rise 13 per cent

17 October 2006

The US's fourth-biggest bank has announced a third-quarter profit rise of 13 per cent.

Wachovia's net income climbed to $1.88 billion on the back of gains in business and consumer lending over the quarter, the bank said.

Consumer borrowing rose 36 per cent while commercial loans gained 14 percent, driving a consumer and business banking profit rise of 28 per cent to $1.25 billion.

The bank has focussed on improving consumer services in western states, with 36 new branches opening in the first half of 2006 and 467,000 new consumer retail checking accounts.

The revenue increase of 5.2 per cent for the quarter, however it fell short of analysts' predictions, and shares yesterday fell 2.2 per cent – the most in five months.

The bank's share price has declined 4.9 per cent since the merger with Golden West was announced on May 7th.

CEO Kennedy Thompson told analysts Wachovia was "not satisfied" with the revenue figures, adding: "Our team is all over delivering better results going forward."

Results for the third quarter will be released by the remaining top five US banks – Wells Fargo, JPMorgan Chase, Citigroup and Bank of America – over the next few days.

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