At the Scharf end

15 October 2019 By Antony Currie Follow @AntonyMCurrie

Charlie Scharf doesn’t just have a problem culture to fix and regulators to appease, as the $220 bln bank’s latest results suggest. Strip out $1.6 bln in litigation costs and other one-offs, and higher expenses and falling interest income leave Wells a shell of its former self.

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Wells Fargo on Oct. 15 reported third-quarter net income available to common shareholders of $4 billion, or 92 cents a share. Adjusted for one-off items, earnings of $1.07 a share missed the median estimate of sell-side analysts of $1.15 a share. Results included a $1.6 billion reserve build for possible litigation charges resulting from “disclosed retail sales practices matters.”

The bank also booked a $1.1 billion gain from selling its Institutional Retirement and Trust business.

Charlie Scharf starts as the bank’s chief executive on Oct. 21. He joins from Bank of New York Mellon, where he was also CEO.

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