Wells Fargo Nears Removal of Asset Cap

Wells Fargo is approaching the final stages of meeting regulatory requirements to lift a $1.95 trillion asset cap imposed by the Federal Reserve due to its 2016 fake accounts scandal. The cap, which has restricted the bank's growth and cost it over $10 billion in earnings, could potentially be removed as early as the first half of 2025 if the Federal Reserve is satisfied with the bank's improvements in governance and risk management. While Wells Fargo has completed the necessary work, the Fed's board must still vote on the matter, and concerns about unresolved compliance issues persist, highlighted by Senator Elizabeth Warren's warnings. The bank has faced numerous penalties since the scandal, including billions in fines, and is currently under eight additional consent orders from various regulatory bodies. The lifting of the cap would be a significant milestone for Wells Fargo, allowing it to compete more effectively with its peers, who have experienced substantial growth since the cap's implementation. The situation remains fluid, with the regulatory climate expected to evolve under the incoming administration of President-elect Donald Trump.