Back to top

Image: Bigstock

Wells Fargo Asset Management Unit Taps Into Private Credit

Read MoreHide Full Article

With a view to bolster its operations, Wells Fargo & Company (WFC - Free Report) has expanded its asset management unit’s product offerings to include private credit for middle-market companies. The news was reported by Bloomberg.

Brian Van Elslander, who previously was part of securities division at Wells Fargo, has been appointed to lead the business. Per Kristi Mitchem, CEO of Wells Fargo Asset Management (“WFAM”), debt offering to middle level corporate clients is a key strength for the bank. Through this expansion, Wells Fargo will able to better exploit its advantage and tap a larger share of middle-market corporate clients.

With $497 billion assets under management as of Mar 31, 2018, WFAM remains focused on reinforcing its position as a diversified asset manager and drive solid growth. On its 2018 investor day, Wells Fargo mentioned plans to broaden its reach in multi-asset solutions, systematic along with alternatives and private markets.

Since the outbreak of the fake account scandal in September 2016, several divisions of Wells Fargo have been closely scrutinized by regulators. Per the latest quarterly filing, the bank’s investment management segment is undergoing a review to assess whether there have been inappropriate referrals or recommendations, including with respect to rollovers for 401(k) plan participants, certain alternative investments and referrals of brokerage customers.

Recently, Wells Fargo received the final approval for $142 million settlement to compensate customers harmed by the bank’s unauthorized account opening scandal. However, it still has to face a number pending legal proceedings, which might affect its financials.

Nevertheless, Wells Fargo have been taking remedial measures and initiatives to stay afloat. Also, lower tax rates and rising rate environment might help it overcome the negatives.

The stock has lost 8.5% over the past six months compared with the industry’s decline of 2.4%.

Wells Fargo currently carries a Zacks Rank #3 (Hold).

Stocks to Consider

Fifth Third Bancorp (FITB - Free Report) has witnessed 6.4% upward estimate revisions for the last 60 days. Additionally, the stock has gained nearly 22%, in a year’s time. It currently sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Northern Trust Corporation’s (NTRS - Free Report) current-year earnings estimates have remained stable over the last seven days. Over the past year, the company’s share price has been up 14.1%. It currently carries a Zacks Rank #2 (Buy).

The Bank of New York Mellon Corporation (BK - Free Report) has witnessed 1.9% upward estimate revision in current-year earnings over the last 60 days. Additionally, the stock has jumped 15.3% in 12 months’ time. It currently carries a Zacks Rank #2.

Today's Stocks from Zacks' Hottest Strategies

It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.

And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.

See Them Free>>