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Wells Fargo (WFC) Might Cringe With New Regulatory Penalties
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Amid mounting litigation issues, the U.S. lender — Wells Fargo & Company (WFC - Free Report) — has once again come under regulators’ eyes. Per Reuters, the Office of the Comptroller of the Currency (OCC) might charge the bank with new penalties for issues related to car insurance and mortgage loans.
Wells Fargo is under OCC’s investigation for improperly charging customers for car insurance and mortgage loans, disclosed this year. Therefore, if the inquiry reveals violation of agreement, known as a ‘Matter Requiring Attention’ to finish off unfair and deceptive business malpractices, the bank will be charged with new penalties. Moreover, issues related to previous consumer lending continues for this U.S. lender as well.
This week, the bank’s chief executive — Tim Sloan — will be answering the Senate Banking Committee’s questions related to scandal over the bank’s sales practices since the past year. Thus, the new penalties of the OCC will depend to an extent on Sloan’s assurance to lawmakers.
It has been almost a year since the news of Wells Fargo’s alleged involvement in unfair sales practices hit headlines. Apart from being penalized by the regulators with a fine of about $185 million, the bank had to go through a lot of restructuring. The recent disclosures by Wells Fargo revealed to have identified an additional 1.4 million fake accounts apart from the 2.1 million accounts reported last September.
Spokesperson of Wells Fargo refrained from comments on regulatory matters.
Currently, the banking giant is caught in a horde of litigations over several malpractices which have come into the spotlight. It is going to be a long and expensive journey for the bank till it gets all the dust settled.
The bank’s performance so far this year reflects investors’ disappointment. Shares of Wells Fargo have gained just around 1%, significantly underperforming the industry’s rally of 9.9%.
Wells Fargo currently carries a Zacks Rank #4 (Sell).
Better-ranked stocks in the same space are BancFirst Corporation (BANF - Free Report) , sporting a Zacks Rank #1 (Strong Buy), while M&T Bank Corporation (MTB - Free Report) and Wintrust Financial Corporation (WTFC - Free Report) carry a Zacks Rank #2 (Buy).
BancFirst Corporation’s earnings estimates have been revised 1.1% upward for 2017, in the past 60 days. Also, its share price has soared 61.4% over the last year.
M&T Bank’s earnings estimates for 2017 have been revised slightly upward, over the last 30 days. Further, in a year’s time, the company’s shares have jumped 38.9%.
Wintrust Financial’s earnings estimates have been revised 5.1% upward for 2017, in 90 days’ time. Also, its share price surged 43.3% over the past year.
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Image: Bigstock
Wells Fargo (WFC) Might Cringe With New Regulatory Penalties
Amid mounting litigation issues, the U.S. lender — Wells Fargo & Company (WFC - Free Report) — has once again come under regulators’ eyes. Per Reuters, the Office of the Comptroller of the Currency (OCC) might charge the bank with new penalties for issues related to car insurance and mortgage loans.
Wells Fargo is under OCC’s investigation for improperly charging customers for car insurance and mortgage loans, disclosed this year. Therefore, if the inquiry reveals violation of agreement, known as a ‘Matter Requiring Attention’ to finish off unfair and deceptive business malpractices, the bank will be charged with new penalties. Moreover, issues related to previous consumer lending continues for this U.S. lender as well.
This week, the bank’s chief executive — Tim Sloan — will be answering the Senate Banking Committee’s questions related to scandal over the bank’s sales practices since the past year. Thus, the new penalties of the OCC will depend to an extent on Sloan’s assurance to lawmakers.
It has been almost a year since the news of Wells Fargo’s alleged involvement in unfair sales practices hit headlines. Apart from being penalized by the regulators with a fine of about $185 million, the bank had to go through a lot of restructuring. The recent disclosures by Wells Fargo revealed to have identified an additional 1.4 million fake accounts apart from the 2.1 million accounts reported last September.
Spokesperson of Wells Fargo refrained from comments on regulatory matters.
Currently, the banking giant is caught in a horde of litigations over several malpractices which have come into the spotlight. It is going to be a long and expensive journey for the bank till it gets all the dust settled.
The bank’s performance so far this year reflects investors’ disappointment. Shares of Wells Fargo have gained just around 1%, significantly underperforming the industry’s rally of 9.9%.
Wells Fargo currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Stocks to Consider
Better-ranked stocks in the same space are BancFirst Corporation (BANF - Free Report) , sporting a Zacks Rank #1 (Strong Buy), while M&T Bank Corporation (MTB - Free Report) and Wintrust Financial Corporation (WTFC - Free Report) carry a Zacks Rank #2 (Buy).
BancFirst Corporation’s earnings estimates have been revised 1.1% upward for 2017, in the past 60 days. Also, its share price has soared 61.4% over the last year.
M&T Bank’s earnings estimates for 2017 have been revised slightly upward, over the last 30 days. Further, in a year’s time, the company’s shares have jumped 38.9%.
Wintrust Financial’s earnings estimates have been revised 5.1% upward for 2017, in 90 days’ time. Also, its share price surged 43.3% over the past year.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
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