Wells Fargo & Co., one of the largest lenders to consumers among U.S. banks, on Wednesday said its fourth-quarter profit shot up, as its customers payment habits improved and it was able to lower the amount of reserves set aside to cover souring loans.

The San Francisco-based bank said its net income attributable to common stockholders was $3.2 billion, or 61 cents per share.

Last year, the company earned $394 million, or 8 cents per share, as its results were affected by a large preferred dividend paid to the government, which was not necessary this year. Wells Fargo in December 2009 paid back the bailout money it received from the government during the financial crisis.

The latest results matched the 61 cents per share forecast by analysts polled by FactSet, but shares dipped slightly in early trading. Wells Fargo stock lost 15 cents to $32.34 after the opening bell.

CEO John Stumpf said all the bank's business segments contributed to earnings as the economy started to gain strength.

The bank reported a notable improvement in the performance of its outstanding loans. The total loans it had to write off as uncollectable fell to $3.84 billion, from $5.9 billion in the 2009 quarter.

Loans considered past due and likely to default declined for the first time since Wells Fargo bought Wachovia in late 2008, ending the quarter at $32.4 billion.

Wells Fargo wrote off 29 percent fewer uncollectable loans than in the 2009 quarter and released $850 million from loan-loss reserves, the money set aside to cover soured lending.

Wells Fargo said its net interest income, or the money earned from deposits and loans, fell 4 percent to $11.06 billion. Noninterest income, or earnings from fees and charges, fell 7 percent to $10.4 billion.

Notable was a 19 percent decline in noninterest income from its mortgage business, to $2.76 billion. It also posted a 27 percent plunge in service charges on its deposit accounts, to $1.04 billion. That indicates that new government regulations restricting fees like overdraft charges had a big impact.