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Wells Fargo Seeks to Enter Student Loans Refinancing Market

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Wells Fargo & Company (WFC - Free Report) is aiming to enter the student loan refinancing market with a view to bolster its performance, which has of late been impacted by its involvement in a number of legal hassles. The news was reported by Bloomberg.

Eyeing opportunities in the student lending market, of which U.S. government is the major market share holder, Wells Fargo seeks to extend its current offerings to include federal student loans refinancing. Previously, the bank offered only private student loan consolidation, in which, a borrower with multiple Wells Fargo private student loans could combine them into a single loan or refinance any one of them.

In an interview with Bloomberg, head of personal lending at Wells Fargo, John Rasmussen said, “We continue to assess the needs of our customers on refinancing of federal loans into private.” He also added, “We’re sizing what that should look like, how we’d do that in a real customer-focused way.”

He also noted that Wells Fargo looks forward to make bonds with the college going customers and improve its reputation.

Earlier this month, Wells Fargo made the headlines after admitting of having wrongly foreclosed about 400 homes in the period between April 2010 and October 2015, due to an attorney fee-related “calculation error” caused by a mortgage underwriting tool. The bank mentioned that it has kept aside $8 million as provisions to repay the affected customers.

Wells Fargo continues encounter a horde of litigations due to its past wrongdoings. Despite undergoing an advertising campaign aimed at regaining lost image, the bank’s current disclosures brought back widespread criticism.

Shares of Wells Fargo have lost 3.3% over the past six months compared with  3.7% decline witnessed by the industry it belongs to.

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

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