NEW YORK ( TheStreet) -- Wells Fargo ( WFC) weighed in on the court ruling that sparked a sell-off in the banks on Friday, saying the Massachusetts Supreme Court has merely established a path for foreclosures in the state, not cast doubt on a bank's ability to foreclose.

The San Francisco-based bank saw its stock fall 2% to $31.50 on volume of 81.5 million, more than double its trailing three-month daily average of 36.4 million after the court voided two foreclosures, saying Wells and U.S. Bancorp ( USB) hadn't properly handled documents related to the process.



"Wells Fargo believes the court's ruling does not prevent foreclosures on loans in securitizations," the bank said in a terse two-paragraph statement that noted it hadn't originated, owned, serviced or foreclosed upon the loans at issue in the case. "The court simply set forth a standard legal process that mortgage servicers must follow in Massachusetts."

News of the ruling brought back investor fears of potential difficulties with completing foreclosure actions that first surfaced with allegations of "robo-signing" a few months back that forced both Bank of America ( BAC) and JPMorgan Chase ( JPM) to halt foreclosures in certain states for a time.

Shares of Bank of America closed Friday at $14.25, down 1.3%, while JPMorgan's stock fell nearly 2% to $43.64 and Citigroup ( C) shares dipped a penny to $4.94. The KBW Bank, a market-cap weighted index that includes 24 of the biggest U.S. banks, lost almost 1% to 52.88.

Earnings season is about to kick in for the money-center names with JPMorgan on tap to report its quarterly results before the opening bell next Friday. The current average estimate of analysts polled Thomson Reuters is for a profit of 99 cents a share on revenue of $24.44 billion in the December period vs. earnings of 74 cents a share on revenue of $25.24 billion in the year-ago equivalent quarter.

The week after that will see Citigroup's report on Jan. 18 followed by Wells Fargo on Jan. 19 and Bank of America on Jan. 21.

-- Written by Michael Baron in New York.

>To contact the writer of this article, click here: Michael Baron.

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Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

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