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Wealth Management Results Strengthen In Q3 For Wells Fargo

Tom Burroughes

17 October 2016

, the US bank which has seen the departure of its CEO amid a recent scandal around unauthorised client accounts, late last week reported third-quarter net income of $5.6 billion, a fall from $5.8 billion in the same period a year earlier.

The California-headquartered bank said its diluted earnings per share in Q3 were $1.03, from $1.05 a year earlier. Revenues were $22.3 billion, a gain of 2 per cent year on a year earlier.

Wells Fargo has been rocked by a scandal in which it was discovered that some employees had opened millions of accounts without the clients' permission. John Stumpf has stepped down from his position as chairman and chief executive. The bank, as reported last week, appointed Tim Sloan, president and chief operating officer, to succeed him as CEO, and Stephen Sanger, lead director, as non-executive chairman of the board, while independent director Elizabeth Duke serves as vice chair.

In September, the bank reached agreements with the Consumer Financial Protection Bureau, the Office of the Comptroller of the Currency, and the Office of the Los Angeles City Attorney. The settlements totalled $185 million, plus $5 million in customer remediation, Wells Fargo's statement on Friday said.

Wealth
The bank's wealth management net income in Q3 was $677 million, a gain from $606 million a year earlier. This arm of the bank includes Abbot Downing, the unit serving ultra-high net worth individuals. Total client assets in wealth management were $230 billion, a gain of 5 per cent from a year earlier, it said.