Tomahawk, WI 11/27/2013 (BasicsMedia) – When Wells Fargo & Co (NYSE:WFC) released its third quarter financial results for 2013 in October, it clearly emerged that it had posted increase in profits, yet again. This is very good news for all shareholders at WFC since it means that they are not doing too badly. When the largest mortgage lender in the U.S submitted its financial returns to its shareholders, it also announced that the increase in profits was by as much as 13%, which is massive considering that the mortgage sector in the country has not done quite well for a significant portion of this year.

Wells Fargo & Co (NYSE:WFC) did not have much good news to report regarding its home refinancing business, not forgetting that this had been responsible for its profits in the past. As a matter of fact, the fourth largest bank in the U.S by assets, announced that it did not achieve any meaningful growth with its home refinancing business. Apart from this business, none of WFC’s other 89 business had much to report in the way of good news or growth. This has led to a major concern, where analysts ask if the company only posts increased profits, without actual growth in the near future.

Wells Fargo & Co (NYSE:WFC) released its reserves to the market, when it emerged that the U.S economy had somewhat improved and more Americans were able to pay their bills on time. This does not make the fact that the mortgage industry is still struggling massively any easier to bear, for a company that relies mostly on the mortgage business to remain afloat. Does WFC have the capability to overcome any losses it has incurred due to the slowing down of the mortgage sector across the U.S? Can it mitigate any loss and weather the storm until things get better?

Analysts believe that Wells Fargo & Co (NYSE:WFC) must find a way of supporting growth through other sectors or businesses and stop its overdependence on the mortgage business. Nevertheless, the problem is that this is easier said than done. WFC is not the only financial institution in the U.S that has reported losses with its mortgage business. All the other major U.S banks have reported reduction in revenues from their mortgage businesses, and this may become worse when the fourth quarter financial results are announced, bearing in mind the recent U.S government shutdown.

Wells Fargo & Co (NYSE:WFC)’s total revenue fell from a high of $21.2 billion announced during the same quarter in 2012, to a low of $20.5 billion in 2013. It reported a 43% drop in mortgage banking revenue to settle at $1.61 billion. This is such a massive drop in a business that is at the core of WFC’s existence and operations. However, its top executives are convinced that the company has a great potential for growth moving forward. These executives mention the underlying economic trends that they believe create the right environment for their financial institution to experience growth.

Currently, nothing much that stands in the way of Wells Fargo & Co (NYSE:WFC), or stops it from planning and executing several plans that will ensure real growth in its businesses going forward.

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