Analysts Question Wells' Loan-Loss Provision

Wells Fargo's decision to set aside $1.4 billion for its most troubling loans may not be enough, analysts say.

The San Francisco bank said late Tuesday that it plans to record the pretax provision in the fourth quarter and create a special fund to cover losses expected in about $12 billion worth of home-equity loans either purchased or originated through indirect channels, such as wholesale mortgage lending platforms and the correspondent channel.

Analysts wonder about the loss rates on the remaining $71.5 billion of home-equity loans that haven't been designated to the portfolio and why Wells Fargo only added a provision for their worst-performing loans. ...