CHARLOTTE, N.C. -- Low interest rates are still spurring homeowners to refinance their mortgages in droves. And Wells Fargo & Co. is still making billions from it.

The country s largest mortgage servicer reported Friday earning $4.7 billion for shareholders in the third quarter, another record for the San Francisco bank.

The 88 cents per share beat out analysts estimates by a cent, and was 22 percent higher than the same time period a year ago.

We had a very strong quarter, Chief Financial Officer Tim Sloan said on a conference call with analysts, noting that it marked the eleventh straight quarter of earnings per share growth.

But those low interest rates also held up the bank s performance elsewhere. Revenue was down slightly from the previous quarter, to $21.2 billion, mostly because of squeezed margins on investments and loans.

Wells mortgage banking income, which has driven the bank s earnings growth over the last few quarters, faltered a bit as well. It fell to $2.8 billion from $2.9 billion.

Mortgages cost more to service, Wells said, because of new regulations brought about by legal settlements, cutting into its income. The bank also decided to hold nearly $10 billion worth of mortgages on its balance sheet instead of selling them to investors.

Instead of booking profits up front, the bank hopes to make more money over the life of the mortgages at a time when low-risk investments with a high yield are hard to find.

That s how we think about managing the company for the long term, Sloan told analysts.

Mortgage revenue was still up 53 percent over last year.

Wells Fargo shares had fallen more than 3 percent by mid-day.

We believe investors were looking for a much stronger mortgage banking fee income result, analysts with investment firm Stifel Nicolaus wrote in a research note parsing the results. The bank s margins also tightened more than the analysts expected.

Bank of America Corp. reports its third-quarter earnings Wednesday.

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