Wells Fargo Boosts Cost of Interest Lost to Mortgage Deal
Wells Fargo & Co. (WFC), the home lender that agreed to refinance mortgages after a probe of the industry’s practices, may forgo as much as $2 billion in interest, $300 million more than previously estimated.
The lost interest may range from $1.8 billion to $2 billion in future years, or $181 million to $201 million annually, San Francisco-based Wells Fargo said today in its quarterly regulatory filing.
As many as 36,000 borrowers may get their interest rates cut, according to the filing. Wells Fargo, the biggest U.S. home lender, had estimated in August that 40,000 might be covered.
The program is part of a $25 billion mortgage settlement in February by five banks with 49 states and the federal government. The accord, the largest federal-state civil settlement in U.S. history, ended a 16-month probe of abusive foreclosure practices.
Elsewhere in the filing, Wells Fargo said its total exposure to the countries and other non-sovereign entities of Europe climbed 6 percent in the third quarter to $30.2 billion. The bank increased loans and commitments to the governments of the euro region, including Austria and Germany, as well as the U.K., to $2.3 billion at the end of September from $2.1 billion in June, the filing showed.
The lender increased its holdings, including debt and equity securities, with non-sovereign entities located in those countries to $27.9 billion, up from $26.4 billion in June.
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