Perhaps the most dramatic fallout from bank earnings reports this season was Wells Fargo & Co.'s fall from grace on Wall Street.

The San Francisco banking company's 1996 purchase of First Interstate Bancorp has failed to produce as expected for shareholders, and the stock has slumped. The situation worsened this month, when Wells warned that second-quarter earnings might fall 30% below the 1996 level-and then reported an actual shortfall of 37%.

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