Major US bank Wachovia has increased profits in the third quarter by 13% on the back of strong lending credentials. However, its share price fell as revenues failed to live up to market expectations.
Net income at the fourth largest US bank improved to $1.88 billion from $1.67 billion in Q3 2005, while revenue reached $7.04 billion, a 5.2% increase on the previous year.
Profits increased as a result of gains in business and consumer lending, although recent interest rate rises curtailed the growth by squeezing profit margins. Because of this, Wachovia failed to attain market expectations, leaving investors disappointed and the bank’s share value down by nearly 3% at $54.84.
Kennedy Thompson, Wachovia’s chief executive officer, said that the bank was not satisfied with Q3 revenues, Bloomberg reports. However, he added: I want you to know our team is all over delivering better results going forward. I’m confident we’ll do that in each of our business lines.