Sunday, April 15, 2018

WELLS FARGO... AMERICA'S CRIMINAL BANKSTERS..... A TRADITION OF PLUNDERING A NATION FOR OVER A HUNDRED YEARS

With $1 billion fine, Wells Fargo's tough year gets even worse



The initial $185 million settlement cost Wells Fargo lucrative bond deals with government agencies, led to contentious congressional hearings and spurred the abrupt retirement of then-Chairman and CEO John Stumpf.


The amount may change as the San Francisco-based lender continues talks with the Consumer Financial Protection Bureau and the Comptroller of the Currency's Office, potentially altering the preliminary first-quarter profit growth reported on Friday. Wells Fargo's brand has been tarnished since it conceded in late 2016 that 5,000 workers had been fired over a five-year period for creating more than 3 million unauthorized customer accounts in order to meet ambitious sales targets.
The initial $185 million settlement cost the bank lucrative bond deals with government agencies, led to contentious congressional hearings and spurred the abrupt retirement of then-Chairman and CEO John Stumpf. Under his successor, Tim Sloan, the bank conceded it was also facing reviews of prior mortgage practices as well as the sale of unneeded insurance policies to auto-loan applicants who were told they might not qualify otherwise.
The latest settlement talks show Wells Fargo "still has wood to chop regarding the consumer-related issues the company faces," Brian Kleinhanzl of brokerage Keefe, Bruyette & Woods, said in a note to clients.
Earlier this year, the Federal Reserve imposed a cap on Wells Fargo's growth until it improves corporate oversight, a move that Sloan has said will curb the lender's profit by as much as $400 million. The directive requires the San Francisco-based lender to keep its assets at or below the roughly $2 trillion held at the end of December 2017. At that time, it was the nation's third-largest bank, behind New York-based JPMorgan Chase and Charlotte, N.C.-based Bank of America.
The cap isn't hurting Wells Fargo's ability to expand lending in areas where it seeks growth since it can compensate by selling assets in other sectors, Sloan has said, a point he reiterated on an earnings call Friday.
"Our folks are out there facing off with our customers every day across the entire platform," the CEO told analysts. At the same time, the lender is committed to resolving regulatory concerns and is reviewing all its businesses to ensure they meet compliance standards.
"We've certainly had a thorough look in every nook and cranny in the company, and we're continuing to," Sloan said. "One of the lessons learned for us, candidly, over the last few years is that we should have been doing a better job of that when we were performing quite well in the prior years, and we're not going to make that mistake again."
Wells Fargo shares fell 3.1 percent to $51.05 in New York trading on Friday. Based on the lender's preliminary figures, net income climbed 5.4 percent to $5.9 billion, or $1.12 a share, in the three months through March. 
Updated 4/13/18, 12:07 PM: Updated with analyst comment in fourth paragraph.

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