Third-quarter profit for Wells Fargo & Co., the biggest U.S. mortgage lender, jumped 13 percent as a decline in revenue from mortgage lending was offset by reduced expenses and fewer soured loans. THE RESULTS: Net income increased to $5.6 billion in the July-September period from $4.9 billion a year earlier. On a per-share basis, earnings were 99 cents, beating the 97 cents forecast by Wall Street. Third-quarter revenue dipped to $20.5 billion from $21.2 billion, coming in below the analysts’ forecast of $21.1 billion. The bank’s stock fell 87 cents, or 2 percent, to $40.58 in early trading. HOW IT HAPPENED: Interest rates on U.S. mortgages rose sharply in the spring and summer. That had a negative impact on Wells Fargo’s mortgage business. The San Francisco-based bank controls nearly a third of the U.S. mortgage market. Much of its lending business has been coming from mortgage refinancing, which was reduced by the spike in interest rates. Wells Fargo funded $80 billion worth of mortgages in the third quarter, down from $139 billion a year earlier. Fewer bad loans in an improving housing market cut Wells Fargo’s lending losses to $975 million from $2.4 billion in the third quarter of 2012. The bank reduced expenses to $12.1 billion, down $153 million from the second quarter. The savings were mainly due to reduced employee bonuses and legal costs. WHAT’S NEXT? The bank had said back in July that higher interest rates would impact its mortgage business. Now, Wells Fargo says it will be in a strong position with its variety of businesses to weather the economy’s move to higher interest rates. Strong revenue growth is coming from credit cards, personal credit management and retirement services, the bank says.