Wells Fargo & Co. must keep a lid on its growth until the bank has hardened its risk management policies to prevent any further abuse of its customers, said Jerome Powell, chairman of the Federal Reserve.
In February, the Fed ordered Wells Fargo to freeze its balance sheet, keeping its assets below $1.95 trillion, until it put new checks on senior managers and gave the board new powers to sniff out abuses.
. We have no intention of lifting the border of existence to ensure that the solutions to these issues are adopted and satisfactory, etim said Powell in a letter to US Senator Elizabeth Warren, seen by Reuters.
Reuters has not been able to satisfy the FED so far, Reuters said, and the bank has lagged behind the time to offer an acceptable reform plan.
A bank representative did not respond promptly to comment on Powell’s letter. Wells Fargo executives have previously said they expect the cover to be lifted in the first half of next year.
He was the vocal critic for Tim Sloan, Massachusetts Fellow, Warren, Wells Fargo, and Chief Executive Officer. In October, Warren wrote a letter asking the regulator not to lift the limit of existence until Sloan was removed, claiming that Sloan was “deeply touched” in the evils of the past. Wells Fargo described Sloan’s 30-year mandate as an asset to the bank and said he gave the full support of the board.
On Monday, Warren abolished the bank to be late for the reform plan and said Sloan should go.
Lar Wells Fargo has already been months ahead, War Warren said in a statement. . If the FED is serious about replacing applications that are costing customers in their homes or cars or credit points at Wells Fargo, they should insist on a new leadership in the bank. “
Wells Fargo’s sanctions were based on a sales practices scandal that erupted in 2016, when employees reportedly opened millions of counterfeit accounts on their customers’ names. In a letter to Warren, Powell wrote that what was inside the bank was’ ugly, a but he refused to say whether Sloan would continue to rule the bank.
Since the counterfeit accounts scandal, Wells Fargo said there were abuses in auto insurance, small business loans, mortgage lending and other business areas.
Wells Fargo, after meeting the requirements of the February agreement, wrote that Powell would decide whether the bank would grow.
An The decision to terminate the asset growth restriction applied to Wells Fargo will be granted by a vote of the Board of Directors, Pow said Powell on November 28th.
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