<div><p>NEW YORK (Reuters) - Wells Fargo & Co <WFC.N> swung to a fourth-quarter profit on a pickup in fee income, even as it repaid $25 billion in bailout funds to the U.S. government.</p><p>The fourth-largest U.S. bank by assets reported a profit of $2.82 billion, or 8 cents a share. Analysts on average expected a loss of 1 cent a share, according to Thomson Reuters
I/B/E/S.</p><p>In the fourth quarter of 2008, excluding the impact of Wachovia Corp, which Wells Fargo bought at the end of the year, it reported a loss of $2.73 billion, or 84 cents a share.</p><p>While analysts broadly view the San Francisco-based bank as among the stronger survivors of the financial crisis, it is facing mounting losses on Wachovia mortgage portfolios.</p><p>Loan losses jumped to $5.9 billion in the fourth quarter from $3 billion a year earlier, driven by residential and commercial mortgage losses.</p><p>But the bank set aside just $5.9 billion against loan losses in the quarter, compared with $8.4 billion a year earlier.</p><p>Chief Financial Officer Howard Atkins said losses from Wachovia are "tracking better than originally estimated at the time of the merger."</p><p>Offsetting credit losses was a surge in revenue from the bank's fee-based businesses, such as investment management and mortgage servicing. Noninterest income climbed to $11.2 billion in the fourth quarter from $2.8 billion, excluding Wachovia, a year earlier.</p><p>Wells Fargo shares climbed 3 percent in premarket trading to $29.10.</p><p>Last month Wells Fargo repaid a $25 billion government bailout it received in October 2008 under the Troubled Asset Relief Program. The bank sold $12.25 billion in stock to help fund the repayment.</p><p>(Reporting by Elinor Comlay; editing by John Wallace)</p><img src="http://admatch-syndication.mochila.com/images/ad.gif?aid=67351378&bid=informcom" /></div><div id="copyright"><div>

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