Wells Fargo 2008 results

the 2nd largest bank in USA by mkt cap. or the 3rd in the world after HSBC & JP Morgan

• Bad - 4q08 interest income down 6% vs prior year, other income down 34%, loan provision up 223%, EPS down 68% to $0.76 or down 68%;
• Good - Exclude $3.9B de-risk due to merge & acquisition, 4Q08 EPS is in fact $0.42 or down 7% only, beat analysts expectation by 25%;
• Fair but the best among peers - 2008 interest income down 1% vs prior year, other income down 7%, loan provision up 224%, EPS change from $0.41 to ($0.79);
• Good - 2008 Return of equity 5.2%, lot better than JP Morgan (JPM)'s 2% & Bank of America (BAC)'s 1.8%
• Excellent -4q08 Net interest margin 4.9% also better than JPM's 2.9% and BAC's 2.9% and loan provision rate is only 2.69%.
• Good - Book value ran up from $14.14 in Sep 30 08 to $23.43 in Dec 31 after the merge, once again beat analysts expectation by 64%
• Good - Dividend paid remain @ $0.34/qtr and management don't expect additional TRAP are another 2 good news.
• Bad - The only concern is the Tier 1 capital ratio is only 7.9%, lower than peers. Excluded merge impact, it is in fact 10.2% (historical high) close with peers;

Stock price rise by 30% after 08 result announcement.