Wells Fargo Expects 2026 NII to Reach $50B: What's Fueling Growth?

Wells Fargo & Company WFC has outlined a confident outlook for its core earnings power, projecting total net interest income (NII) of $50 billion for 2026. The outlook underscores the bank’s renewed growth momentum following the lifting of its $1.95-trillion asset cap in June 2025 and reflects management’s ability to capitalize on a favorable operating environment. A notable component of this outlook is the expected rise in markets-related NII, which will likely grow to $2 billion by 2026.2026 NII Expectation Image Source: Wells Fargo & Company Wells Fargo’s 2026 target is built on a solid foundation. Over the past several years, the bank has delivered consistent improvement in net interest income, posting a four-year compound annual growth rate (CAGR) of 7.5% through 2025. This growth has been driven by steady loan expansion, disciplined deposit pricing and active balance sheet management, even amid volatile interest rate conditions.Crucially, the lifting of Wells Fargo’s long-standing asset cap removes a major structural constraint. With the balance sheet now free to expand, the bank can once again compete more aggressively for loan and deposit growth. Management expects average loans and deposits in the fourth quarter of 2026 to increase year over year at a mid-single-digit rate, reinforcing confidence in sustained balance sheet expansion. Also, the Federal Reserve rate cuts stabilized funding costs, which will aid NII growth.Additionally, the bank continues to streamline operations, invest in technology and eliminate inefficiencies accumulated during years of regulatory remediation. As these initiatives take hold, operating expenses are expected to remain well-controlled. Lower costs improve the incremental profitability of balance sheet growth, ensuring that rising NII translates more directly into higher earnings and returns for shareholders.Hence, Wells Fargo’s balance sheet acceleration, expense discipline and focus on operational efficiency position it for continued, positive NII momentum in 2026.How Are WFC’s Peers Likely to Fare in Terms of NII?Two of the closest peers of Wells Fargo are Bank of America BAC and Citigroup C.Bank of America projects a 5-7% year-over-year increase in NII for 2026, after registering 7.2% growth in 2025. The outlook reflects the company’s ability to leverage a favorable rate environment, technological efficiency and a diversified business model. Bank of America’s NII has closely tracked interest rate cycles. The bank saw steady NII growth during 2018-2019 amid Fed rate hikes, followed by a sharp decline in 2020-2021 when rates fell to near zero. As rates rose again from 2022 onward, NII rebounded sharply, driven by asset repricing, robust loan demand and disciplined funding management. Citigroup projects 2026 NII to rise 5-6% year over year. In 2025, its NII rose 11% from the year-ago period. The company’s NII outlook remains favorable, supported by a stable interest rate environment and solid balance sheet trends.  Additionally, Citigroup’s broad geographic reach and well-diversified business model position it to navigate shifting economic and interest rate cycles effectively. These factors enhance its capacity to sustain NII growth in the upcoming period.WFC’s Price Performance, Valuation & EstimatesShares of Wells Fargo have gained 17.1% in the past year compared with the industry’s growth of 30.3%. Price Performance Image Source: Zacks Investment Research From a valuation standpoint, WFC trades at a forward price-to-earnings (P/E) ratio of 12.46X, below the industry’s average of 14.83X.Price-to-Earnings F12M Image Source: Zacks Investment Research The Zacks Consensus Estimate for WFC’s 2026 and 2027 earnings implies year-over-year rallies of 12.3% and 11.9%, respectively. Estimates for both years have been revised upward over the past seven days.Estimate Revision Trend Image Source: Zacks Investment Research WFC currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.#1 Semiconductor Stock to Buy (Not NVDA)The incredible demand for data is fueling the market's next digital gold rush. 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