Wells Fargo CEO Confident Federal Reserve Will Lift $1.95T Asset Cap

Wells Fargo CEO Charlie Scharf expressed strong confidence that the Federal Reserve will eventually lift the $1.95 trillion asset cap imposed on the bank in 2018 following a fake accounts scandal. The bank has made significant progress by resolving 12 consent orders since 2019 and spending $2 billion annually to strengthen risk controls and compliance frameworks, with only two consent orders remaining. Lifting the cap would allow Wells Fargo to grow its loan and deposit businesses more freely, supporting long-term growth and improved returns, including a targeted 15% return on tangible common equity by 2025. While Scharf is optimistic about the progress, he acknowledged that the Fed’s timing remains uncertain and that the regulatory process is thorough and independent. Analysts hold a generally positive outlook on Wells Fargo’s stock, with moderate upside potential based on average price targets, although some valuation models suggest possible downside risks. The bank continues to focus on balancing sustainable growth with compliance improvements and operational enhancements in preparation for a post-cap expansion phase.