Investing.com -- Shares of Wells Fargo & Company (NYSE: NYSE:WFC) climbed 3% following the announcement that the Office of the Comptroller of the Currency (OCC) has terminated its 2018 consent order related to the bank’s compliance risk management program. This termination marks the tenth regulatory consent order closed by the bank’s regulators since 2019, signaling a significant step in Wells Fargo’s efforts to rectify past regulatory issues.
The termination of the OCC’s consent order is a reflection of the progress Wells Fargo has made in overhauling its compliance and risk management practices. CEO Charlie Scharf expressed satisfaction with the OCC’s decision, recognizing it as a testament to the hard work of thousands of Wells Fargo employees dedicated to transforming the company. He emphasized that while this is a notable achievement, the bank remains committed to fulfilling the requirements of its remaining consent orders and aims to rebuild its reputation as a respected financial institution.
Investors responded positively to the news, perceiving the termination of the consent order as a potential reduction in regulatory risk and an endorsement of the bank’s ongoing reforms. Scharf’s statement highlighted the company’s transformation under new management and the closure of three additional consent orders in recent weeks, as well as the termination of the 2016 sales practices consent order last year.
The regulatory relief comes as a welcome development for Wells Fargo, which has faced a series of challenges and penalties since the discovery of various consumer abuses, including the opening of unauthorized accounts. The bank’s efforts to address these issues seem to be bearing fruit, as indicated by the OCC’s recent action.
While today’s stock movement reflects the market’s immediate reaction to the regulatory update, Wells Fargo’s long-term performance will likely depend on its continued progress in meeting regulatory expectations and restoring trust with customers and investors alike. The bank has not yet provided an analyst quote regarding this development.
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