Wells Fargo wins Fed acceptance for overhaul plan tied to asset cap: Bloomberg News By Reuters

© Reuters. A Wells Fargo logo is seen in New York City

(Reuters) – Fed officials have privately signaled to Wells Fargo (NYSE:) & Co that they have accepted its proposal for overhauling risk management and governance, Bloomberg News reported https:// on Wednesday, citing people with knowledge of the matter.

Shares in the lender jumped 6% on Wednesday. The bank declined a Reuters request for comment.

The approval is a key step in getting a regulatory asset cap lifted, which has hindered Wells Fargo’s growth since 2018.

Wells Fargo has been in regulators’ penalty box since 2016 when details of a sales scandal first emerged, leading to the departure of two chief executives, billions of dollars in litigation and remedial costs and the U.S. Federal capping its balance sheet at $1.95 trillion.

A Federal Reserve spokesman declined to comment. But the original enforcement action adopted in 2018 lays out the lengthy process the bank must undertake to be relieved of the cap, including overhauling its board effectiveness and risk management.

Under the public order, the Fed must sign off on any plan to address shortcomings at the bank and verify its implementation. After that, an independent third party must come in and review the plan and its implementation. Only then would the Fed board consider voting to lift the asset cap.

Last month, Chief Financial Officer Mike Santomassimo said the bank was making progress on getting the asset cap removed but it still had “a significant amount of work to do”.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Be the first to comment

Leave a Reply

Your email address will not be published.


*