Wells Fargo & Company (WFC - Free Report) has announced plans to restructure its Commercial Banking unit by combining Business Banking, Government & Institutional Banking and Middle Market Banking businesses. It expects to further improve customer experience through this move.
The new structure will be headed by Kyle Hranicky, who has been serving Wells Fargo for the past 25 years. It will have more than 6,000 team members across 24 divisions and 80 markets nationwide, and cater all the financial needs of customers.
Commercial banking division will remain part of its wholesale banking line of business. The wholesale banking division will now be divided into commercial banking, corporate and investment banking, commercial real estate and commercial capital.
The unit will provide credit and treasury solutions to customers with annual sales ranging between $5 million and $2 billion. Further, the bank provides expertise across industries, like Food, Beverage & Agribusiness, Investor Real Estate, Government and Technology throughout its regional presence, with its newly formed national Specialized Industries group.
Also, Wells Fargo reduced the layers of management involved so as to simplify the leadership structure. The commercial business will operate in three regions across the United States i.e., East, Central, and West — each region having a dedicated leader.
“With our new integrated business model and regional structure, we’re strengthening our core capabilities - providing local service and industry expertise. Our market leadership affirms that we have the best team in the industry, and we’re excited to continue to help our commercial customers grow and be successful.” said Hranicky.
Notably, Wells Fargo has been making efforts at improving its financial position and reputation that was affected by involvement in a horde of scandals.
In May, the company created a strategic execution and operations unit that seeks to meet demands of several regulators and compliance officers, who remain unsatisfied with the bank's remediation moves so far. Also, it will focus exclusively on regulatory priorities, i.e., “strengthening and driving the implementation of certain business and risk-management processes”.
Though Wells Fargo’s cost-control plans and efforts to enhance customers experience seem impressive, the company still has to look out for a CEO, who can be trusted with the responsibility to turn around the bank.
Shares of Wells Fargo have lost 8.8% over the past six months against 3.4% growth recorded by the industry.
Currently, the stock carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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