The result was much stronger than for the year-ago quarter, when Wells Fargo (WFC) earned a penny a share on $17.7 billion of revenue as it braced for the economic impact of the coronavirus pandemic. Net income totaled $4.7 billion, up from $653 million a year ago, partly because the bank released from its reserves $1.6 billion it had set aside for loan losses.

Wells Fargo shares edged up 0.4% in premarket trading.

“Our results for the quarter, which included a $1.6 billion pretax reduction in the allowance for credit losses, reflected an improving U.S. economy, continued focus on our strategic priorities, and ongoing support for our customers and our communities,” Charlie Scharf, chief executive of the bank, said in a statement.

Wells Fargo has been one of the closest-watched banks over the past year as it continues to address the aftermath of its fake-accounts scandal, which emerged in 2016. Wells Fargo has smaller trading and investment-banking businesses than its peers, so it benefited less from a surge in trading and deal-making that came during the pandemic. Its shares have lagged behind the industry for much of the past year. 

In recent quarters, Scharf has highlighted the work Wells Fargo has ahead of it. On the list are streamlining operations and working to have the Federal Reserve remove a limit of $2 trillion on its assets that the central bank imposed in response to the fake-accounts scandal.

In the first quarter, the bank’s return on average tangible common equity was 12.7%, up from being flat in the year-ago quarter. Its efficiency ratio, a measure derived by dividing a bank’s noninterest expenses by its net income, climbed 3 percentage points from last year’s first quarter to 77%, but improved 7 percentage points from last year’s fourth quarter.

“We are also moving forward with our commitment to simplify the company and focus our resources on our core customers. We announced sales of our Asset Management and Corporate Trust businesses in the quarter and we are increasing resources dedicated to initiatives to help drive growth in our core franchises,” Scharf said.

Wells Fargo shares have risen 33% this year beating the KBW Bank Index (BKX), which is up 25%, and the S&P 500, up 10%.

JPMorgan Chase (JPM) and Goldman Sachs Group (GS) reported earnings earlier in the morning. Both were much stronger than expected, thanks to a surge in trading and deal-making activity. Bank of America (BAC) and Citigroup (C) report Thursday, while Morgan Stanley ‘s results are due on Friday.

Write to Carleton English at carleton.english@dowjones.com