Wells Fargo, which had largely weathered the storm in housing, now says it will set aside $1.4 billion in its fourth quarter to cover losses on home-equity loans.

It joins a long list of banks that have taken charges and write-downs as a result of the slump in housing and the collapse of the subprime mortgage market. At the top of that list is Citigroup, which has taken a $6.5 billion write-down in its third quarter and is expected to take billions more in its fourth.

Wells Fargo has been largely spared the pain, even though it is one of the biggest mortgage and home-equity lenders in the country. In the face of rising default rates, the fifth-biggest bank in the country moved quickly earlier this year to stop subprime mortgages and to tighten already conservative lending standards.

The bank also said late Tuesday that $11.9 billion in home-equity loans that it acquired through other financial institutions would be put in a special portfolio and liquidated. These loans, the bank said, accounted for only 3 percent of its total loans outstanding, but represented the highest risk, being largely concentrated in housing markets that have had the steepest decline in value.

"Home-equity loans remain an important product for our customers," said John Stumpf, who became chief executive of Wells Fargo earlier this year. "However, given the declining performance of these specific indirect categories of home equity loans, we believe it's prudent to further tighten our standards, to stop acquiring new loans in these segments, and to manage the portfolio as a liquidating, nonstrategic asset."

Shares of Wells Fargo fell sharply in after-hours trading on Tuesday.

"Maybe people are going to be freaked out about Wells Fargo's losses, but they shouldn't be," Richard Bove, an analyst with Punk, Ziegel & Co., told the Associated Press. "Wells Fargo isn't superhuman and they made some bad loans just like everyone else."