Wells Fargo regains regulatory footing with OCC order lift

SAN FRANCISCO - Wells Fargo (NYSE:WFC) & Company (NYSE: WFC) announced today that a significant regulatory hurdle has been overcome with the Office of the Comptroller of the Currency (OCC) terminating the 2018 consent order related to the bank's compliance risk management program. This marks the tenth consent order closure for the company by its regulators since 2019, signaling a turnaround in its regulatory compliance efforts.

The 2018 consent order was one of several enforcement actions taken by regulators in the wake of Wells Fargo's various consumer scandals, including the notorious fake accounts scandal that came to light in 2016. The termination of this order follows the OCC's previous action last year when it lifted the 2016 sales practices consent order.

Wells Fargo's CEO, Charlie Scharf, commented on the termination, acknowledging the extensive efforts by employees to transform the bank's operations and culture. "We are a different company today than when the new management team arrived," Scharf stated, expressing confidence in the bank's path forward to resolve remaining regulatory issues and to rebuild its reputation.

Wells Fargo, a major financial services company with roughly $1.9 trillion in assets, operates across several segments, including Consumer Banking and Lending, Commercial Banking, Corporate and Investment Banking, and Wealth & Investment Management. The company emphasizes its commitment to social impact in the communities it serves, focusing on sustainable and inclusive initiatives.

The bank cautions that forward-looking statements regarding its future performance contain risks and uncertainties, and actual results may differ from current expectations. Investors are advised to not place undue reliance on these projections. For deeper insights into Wells Fargo's valuation and prospects, InvestingPro subscribers can access comprehensive analysis showing the stock's Fair Value estimate and 13 additional ProTips, along with detailed financial health metrics and expert research reports.

This news development is based on a press release statement and comes as Wells Fargo continues to work through the aftermath of past regulatory issues and strives to establish itself as a respected financial institution.

In other recent news, the Federal Reserve has ended climate stress tests for major U.S. banks, including JPMorgan Chase (NYSE:JPM) & Co., Citigroup Inc (NYSE:C)., and Goldman Sachs Group Inc (NYSE:GS). The decision means these banks will not need to submit data for the Fed's Climate Scenario Analysis Exercise this year. In a different development, Wells Fargo announced that the Federal Reserve Board has lifted two longstanding consent orders against the bank, dating back to 2011, related to the bank's mortgage servicing and Wells Fargo Financial business practices.

CEO Charlie Scharf views this as further evidence of the bank's progress in addressing past regulatory issues. These regulatory resolutions showcase Wells Fargo's commitment to rectifying historical issues. Additionally, Wells Fargo, in partnership with Barlow Research Associates, released its 2024 Q4 Commercial Business Sentiment Report, revealing high optimism among commercial businesses.

Lastly, Wells Fargo disclosed the compensation details for its CEO and President, Charles W. Scharf, who will receive $31.2 million for his performance in 2024. The Board acknowledged Mr. Scharf's effective leadership across several fronts, including significant advancements in the bank's risk and control infrastructure, robust financial results, and a substantial return of approximately $25 billion to shareholders.

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