Wells Fargo & Co reported a 19% rise in second-quarter profit due to improved credit quality, but signs of a weakening home-lending business show that banks are still struggling to eke out profits.

The San Francisco-based lender reported net income of $5.52bn, compared with year-earlier income of $4.62bn. Per-share earnings, reflecting the payment of preferred dividends, were 98 cents versus 82 cents a year earlier. Revenue was roughly flat at $21.38bn.