Following a fake accounts scandal and thousands of employees committing fraud, Wells Fargo has been in hot water over the past few months, and it looks like the company is set to make some big moves.
This past Sunday, The Financial Times shared news that Wells Fargo is eliminating various parts of its smaller banking businesses via spinning off various products. The hope here is that the company will maintain its more sought-after products and is likely slowly doing away with those not bringing in value to the bank.
Given the fact that Wells Fargo recently shared its decision to pay out $142 million to settle its class-action lawsuit that stemmed from a scandal involving the creation of fake accounts and credit cards for various customers without their knowledge or permission, the move to reduce its offerings is both strategic and necessary. The bank is hoping that through this effort, investors’ confidence and faith will be restored.
Currently, there have been announcements for Wells Fargo to sell its registration arm to Equiniti for $227 million and its commercial insurance business to an undisclosed company and sum of money.
If Wells Fargo continues at this pace, some may begin to question whether or not the banking entity will have a future.
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