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Tuesday, March 26, 2019

By Dan Freed

NEW YORK (Reuters) – Wells Fargo & Co’s veteran chairman and chief executive officer, John Stumpf, is leaving the bank in the wake of a sales scandal and will be replaced as CEO by President and Chief Operating Officer Tim Sloan.

The San Francisco-based bank said on Wednesday that Stumpf was retiring with immediate effect. It is splitting the role of chairman and CEO with Stephen Sanger, its lead director, becoming chairman. Elizabeth Duke, an independent director, will be vice chair.

The changes come weeks after pressure on the bank when it emerged that its employees had potentially opened two million unauthorized deposit and credit card accounts to meet sales targets. Wells Fargo agreed to a $185 million settlement with regulators.

The scandal marked a stunning reversal of fortune for Stumpf, who had built Wells Fargo into the world’s most valuable bank with a focus on Main Street-style lending that was the envy of Wall Street.

Politicians were calling on him to resign and a week after a roasting in front of a Senate committee, where Sen. Elizabeth Warren (D-MA) confronted him, Stumpf agreed to forgo $41 million in unvested stock awards.

However, that was not enough and at a second hearing, some lawmakers called for the bank to be broken up.

“I have decided it is best for the company that I step aside,” Stumpf said in a statement.

The bank’s shares rose 2 percent in after-hours trading.

On Monday, the bank had reshuffled its top management to give more responsibility to Sloan.

Wells Fargo is due to report third-quarter earnings on Friday.

(Editing by Bernard Orr)

IMAGE: Wells Fargo CEO John Stumpf testifies before the House Financial Services Committee on Capitol Hill  in Washington, DC, U.S. September 29, 2016. REUTERS/Gary Cameron

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5 responses to “Wells Fargo CEO John Stumpf Resigns Amid Scandal”

  1. JPHALL says:

    This would be great except for the millions he gets for leaving.

    • Susannellis2 says:

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    • dpaano says:

      True…he has all those stock options to take with him! Somehow, I just don’t think that should be proper. It seems if a CEO leaves the company under a bad umbrella, he should leave with nothing more than any regular employee would leave with.

  2. dpaano says:

    And, he is forgoing his severance pay…..as he should! I think they should also pay the many people that he fired for his mistake, and it should come out of his pocket!!! After all, they were only doing what they were told to do by management….why is it that they are not working and management is still there?

  3. heather.thomas.93 says:

    Make $90 a day for working an online job from your home for several hrs everyday… Get regular payment on a weekly basis… You’ll need a personal computer, internet connection, and also a little free time… http://korta.nu/NDe

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