Wells Fargo Boosts Dividend (Update2)

Revenue rose 16% from a year earlier to $11.5 billion.

"Wells Fargo continued to strengthen its franchise during the second quarter," CEO John Stumpf said in a statement. "We are open for business and getting lots of it."

"We're still affected by the weak economy, but we believe we're one of the best positioned in financial services to grow through this adversity and to build an even stronger company for our team members, customers, communities and shareholder," Stumpf said.

Wells Fargo took a $3 billion provision charge to cover against $1.5 billion of net charge-offs -- flat from the first quarter -- and an additional $1.5 billion reserve, primarily related to its struggling home equity portfolio, it said.

Wells Fargo separated approximately $12 billion worth of souring brokered home equity loans into a liquidating portfolio at the beginning of the year. The company said Wednesday that the liquidating portfolio has been reduced by $800 million or 7% from the beginning of the year.

In the second quarter, Wells Fargo changed its policy toward charged-off home equity loans to 180 days delinquent from 120 days "to provide more time to work with customers to solve their credit problems and keep them in their homes," the company said on Wednesday. The change deferred roughly $265 million of charge-offs in the second quarter. Approximately 900 customers with $90 million of home equity loans have been modified due to the change, Wells Fargo said.

Wells Fargo's Tier-1 capital level was 8.24% at the end of the quarter, up 32 basis points from the first quarter and 65 basis points since the end of 2007.