Fed lifts growth restriction on Wells Fargo

The Federal Reserve announced that Wells Fargo is no longer subject to the asset-growth restriction from its enforcement action against the bank.

Background: The Fed in 2018 restricted Wells Fargo’s growth until it sufficiently improved its governance and controls following widespread consumer abuses. The Fed said the bank also would have to improve its governance and risk management processes and replace three board members.

Details: The Fed on Tuesday said:

• The removal of the growth restriction reflects the progress the bank has made in addressing its deficiencies and that the bank has fulfilled the conditions required for removal of the growth restriction.

• The other provisions in the 2018 enforcement action will remain in place until the bank satisfies the requirements for their termination.

ICBA View: ICBA in 2018 commended the Fed for heeding the community banking industry’s repeated calls for equitable treatment of Wells Fargo following the megabank’s repeated consumer abuses.