Wells Fargo's Tim Sloan has a role model when it comes to cleaning up the problems at his firm: Brian Moynihan of Bank of America.
Sloan, who has been working to contain the fallout from a fake-accounts scandal since taking over as CEO in October, said he was impressed with how Moynihan dealt with a raft of legal issues arising from the financial crisis during his first years as head of Bank of America.
“Brian has done a great job,” Sloan said Tuesday in a Bloomberg Television interview. “And if I can perform as well as he did, I think that’s going to be great.”
Sloan said that San Francisco-based Wells Fargo is making progress on healing rifts with customers after disclosures last year that retail bank employees opened legions of unauthorized accounts without depositors’ permission. He said he expects that it will take less time to mop up the mess than the six years or so it took Moynihan to put Bank of America’s subprime-related woes behind it.
“We’re going move through this faster, is my guess,” Sloan said. “But it’s going to be up to us to rebuild trust with our stakeholders.”
In the wake of the scandal, Wells Fargo eliminated some incentives for retail bankers, changed the unit’s compensation structure, shook up management and denied bonuses to top executives. Sloan said that while those changes have helped rebuild customer trust, there is no road sign that will tell executives when they have reached the end of the process.
“We’re in a large, complicated business,” Sloan said. “Some days we make mistakes. The important thing is, if we make a mistake, we’re going to fix it and we’re going to learn from it.”
Wells Fargo shares had rose slightly Tuesday, closing at $53.39, but are down nearly 2% since the end of 2015. Bank of America's shares are up by roughly 38% in that span.
