The US Federal Reserve on Tuesday announced that Wells Fargo will no longer be subjected to the growth of asset growth that the regulator imposed on the bank in 2018 after its long -term fake account scandal.
Fed said va declaration On Tuesday, that Wells Fargo fulfilled all the conditions needed to remove the restrictions. The central bank has completed the review of Wells Fargo and third -party evaluation as well as its own FED evaluation on risk management and management programs.
What made the fed to give the limit of assets?
The assets cap were introduced after Wells Fargo was accused of inflating its growth by pushing its employees to open millions of unauthorized accounts to achieve sales goals.
Employees falsified signatures, moved money to unauthorized accounts, and changed contact details to open accounts without customer knowledge, resulting in the Fed blocking the bank over $ 1.95 trillion to total assets, which is a rare and serious fine, as stated by the Financial Times.
According to the Wells Fargo report, he paid regulatory bodies and applicants for a pile over a scandal of more than $ 5 billion.
Bloomberg also said that since then the bank has also lost an estimated potential profits of $ 36 billion. While his competitors, JP Morgan and Bofa, have spread massively, Wells Fargo could not compete for full capacity.
As the bank reacted
CEO of Wells Fargo Charles W. Scharf said on Tuesday that lifting assets is “a Huge success For 215,000 Wells Fargo employees who contributed to this milestone ”.
Scharf also said that each employee would receive $ 2,000, mostly in the form of stock grants. The special price will vary in selected international places and for selected classification of employees.
Sentiment investor after Fed’s decision
The Wells Fargo stock price on Tuesday climbed approximately 3 percent in prolonged trading after the federal reserve system announced. Bank shares are currently traded for $ 75.65, reflecting investors’ confidence.
While the bank still faces some other Fed reviews as part of the 2018 order, the removal of ASSET CAP means a significant shift for the fourth largest creditor of the United States, after the scandals have led to the elimination of more executives. Former CEO of Wells Fargo, Tim Sloan resigned shortly after the decision of the Fed in 2018.
About Wells Fargo
Wells Fargo is a large American multinational financial service based in California.
It is known for offering a wide range of banking, investment and mortgage products and services. Wells Fargo is also considered one of the “large four banks” in the United States.
(Tagstotranslate) Wells Fargo (T) US Bank (T) Federal Reserve (T) US Fed (T) Scandal
