At a UBS financial services conference in Miami, Wells Fargo's Chief Financial Officer, Mike Santomassimo, expressed confidence in the bank's ability to address its remaining five consent orders related to lending and sales practices. He highlighted the recent removal of three regulatory punishments as evidence of the bank's progress, emphasizing a sense of urgency in resolving outstanding issues.
Earlier this month, the Federal Reserve lifted enforcement actions dating back to 2011, which were tied to mortgage servicing, foreclosures, and mortgage lending practices. In January, the Consumer Financial Protection Bureau settled with the bank over alleged mishandling of auto loans and mortgages.
The Federal Reserve had imposed a significant $1.95 trillion asset cap on Wells Fargo in 2018, hindering its growth until compliance was achieved. Analysts anticipate the bank to have the asset cap lifted by 2025, following recent advancements.
The removal of the asset cap, considered a stringent regulatory measure, necessitates approval from the Fed's Board of Governors through a formal vote.
Santomassimo also noted optimism regarding the potential for a "pro-growth" stance under the new Trump administration, echoing sentiments of peer banks like Goldman Sachs CEO David Solomon. He anticipates shifts in the U.S. Federal Reserve's stress testing and expects a more favorable landscape for the Basel III Endgame implementation, promoting balance sheet management certainty within the industry.