The nation’s most embattled bank CEO appears to have taken a cue from the nation’s embattled president.
Asked by an analyst Thursday afternoon about the drumbeat of negative headlines about Wells Fargo — nearly two years after news of the phony-accounts scandal broke — CEO Tim Sloan took a dig at the media, claiming that “many” of the negative headlines that have been written about the company simply aren’t true.
Sloan acknowledged that Wells has made mistakes and said the company has completed a full scrub, looking for any additional problems. Still, he said the news coverage of the company has simply been unfair.
“I wouldn’t believe the headline, period,” Sloan said at the company’s annual investor day in Charlotte, N.C. “It’s been very tiresome for us, to be honest with you, not only this team but the entire team, to have to live through some of the sensational headlines that, in many cases, just aren’t true.”
Sloan didn't detail which headlines or stories weren't true, and a Wells spokesman declined to specify. But it’s understandable Sloan would be frustrated with the media.
After all, it was the Los Angeles Times, in December 2013, that offered the first glimpse of the pressure-cooker sales environment in Wells branches. Later, The New York Times, in August 2017, showed in detail how Wells overcharged auto borrowers for insurance, resulting in almost 25,000 wrongful repossessions.
But those stories were true, not fake news, President Trump’s term for negative stories that are often incorrectly branded as false.
Sloan’s criticism of the media isn’t the real problem — it’s a potential sign of a much more worrying issue, namely that the CEO of Wells Fargo still doesn’t recognize the true extent of the bank’s problems or how the public perceives it.
Taken together, the news coverage over the past 20 months depicts a company that, again and again, has put its customers at risk — by not properly overseeing a third-party auto insurance provider or not asking questions about why so many lower-level retail bankers were being shown the door.
Throughout the investor day presentations on Thursday, the focus was understandably on the bank’s future, rather than on the past. Executives emphasized how far the company has come in revamping internal processes, building new technology and rebuilding trust with customers following its September 2016 settlement with regulators.
Mary Mack, head of the company’s community bank, noted that consumer loyalty is at its highest point since August 2016. Consumer checking accounts, meanwhile, are once again on the rise.
Wells even launched a new marketing campaign — the biggest in its history — to show customers how much things have changed since its once-marquee name was dragged into the mud by the phony-accounts scandal.
And Sloan, in particular, deserves credit for how far he has taken the company in recent months. According to the presentation Thursday, employee morale is up, and retail employees have been supportive of the changes the company has made to its incentive and compensation plans. Those factors are important and critical to the company’s recovery.
But Sloan’s glib dismissal of the many scandals as fake news threatens those accomplishments.
Any company that’s concerned about its reputation knows that the scandal won’t really be over until the stream of negative headlines comes to an end. And that can’t happen until Wells comes to terms with its mistakes — and ensures more scandals aren’t on their way.
Bankshot is American Banker’s column for real-time analysis of today's news.