On Wednesday, Wells Fargo CEO Charlie Scharf stated that the asset cap imposed on the bank by regulators is hindering its ability to attract more corporate deposits and expand its trading business. According to Scharf, corporate lending and trading could be areas of growth for the bank if the asset cap is lifted.
The $1.95 trillion asset cap was put in place on Wells Fargo after a scandal involving fake accounts resulted in hefty fines and regulatory penalties in the form of consent orders. Scharf noted that while the company is making progress in addressing its issues, it is ultimately up to regulators to decide when the asset cap will be removed.
Scharf emphasized the importance of closing out the consent orders, implementing controls, and integrating them into the company to ensure ongoing compliance. He stated that there is still work to be done before the bank can consider the issues resolved and cautioned against premature declarations of victory.
In conclusion, Wells Fargo is actively addressing its past misconduct but continues to face limitations due to the asset cap. Scharf remains focused on meeting regulatory requirements and building a stronger foundation for the bank’s operations.