Wells Fargo’s John Stumpf Testifies Before House Committee
On Thursday, Wells Fargo CEO and Chairman John Stumpf returned to Capitol Hill for a hearing before the House Financial Services Committee, nearly a week and a half after his testimony before the Senate Banking Committee.
We at CBA wanted to capture the mood and intentions of Congress and federal regulators surrounding Wells Fargo, while limiting useless rhetoric (at times difficult). Below please find what we feel are the most useful quotes:
- Comptroller of the Currency Thomas Curry: “I have directed our examiners to review the sales practices of all the large and midsize banks the OCC supervises and assess the sufficiency of controls with respect to these practices.”
- CFPB Director Richard Cordray: “[Cross-selling] should lead banks to focus on strong customer service that produces high levels of customer satisfaction, which in turn should generate repeat business from existing customers and positive word of mouth to others.”
- U.S. Labor Department Secretary Thomas Perez: “I have directed enforcement agencies within the Department to conduct a top-to-bottom review [of Wells Fargo].”
- Federal Reserve Chair Janet Yellen: “We are undertaking a look comprehensively, not only in the consumer area but in compliance generally, because there has been a very disturbing pattern of violations.”
Members of Congress:
- House Financial Services Committee Chairman Jeb Hensarling (R-TX): “And let me be clear: today’s hearing is just the beginning of our investigation, not the end. As I speak, our committee is gathering thousands of pages of records and documents from Wells Fargo and the relevant regulators. In the coming weeks, we will be questioning Wells Fargo executives. If necessary, I will not hesitate to issue subpoenas because we will do what is necessary to get to the bottom of this.”
- House Financial Services Committee Ranking Member Maxine Waters (D-LA): "I'm worried for the whole banking community that the public cannot and will not continue to trust our banks, who we need in this economy in order to do the business to make the economy work and run. I'm moving forward to break up Wells Fargo bank.”
- Congresswoman Nydia Velazquez (D-NY): “I’ll be writing to the SBA Administrator so that they could review all the 7(a) loan portfolios to make sure small business and taxpayers are protected.”
- Senator Elizabeth Warren (D-MA): “[Wells Fargo’s Independent Directors’ initial steps are a] small step in the right direction, but nowhere near real accountability.”
This week, Wells Fargo announced it will eliminate sales goals for employees of its retail banking business beginning in October. Additionally, the company also announced CEO John Stumpf will forfeit unvested equity awards valued at approximately $41 million. During the House Financial Services Committee hearing, Stumpf mentioned Wells Fargo is working on a new incentive program for its employees.
The Department of Labor began reviewing labor practices at Wells Fargo this week, following a letter sent by eight Democrats to the Department requesting it look into whether Wells Fargo violated the Fair Labor Standards Act. The Department of Justice has issued subpoenas to Wells Fargo, and Sens. Jeff Merkley (D-OR.), Elizabeth Warren (D-MA.) and Robert Menendez (D-NJ) wrote a letter requesting the Securities and Exchange Commission investigate the bank for potentially “misleading investors and firing whistleblowers.”
You may read a summary of the House hearing here.
The California Assembly's banking committee will hold a hearing on Tuesday, October 11, 2016.
CBA Celebrates Women in Banking
CBA celebrates our members recognized by American Banker for their contributions to the financial services industry. CBA Board Member Mary Navarro, Senior EVP and Retail and Business Banking Director at Huntington, has been named one of "The 25 Most Powerful Women in Banking,” and former CBA Board Member Nandita Bakhshi, President and Chief Executive at Bank of the West, took the top spot in “ Women to Watch.” CBA is honored to work alongside such an esteemed membership.
You may view a list of CBA’s members recognized by the American Banker here.
Be sure to share your exceptional women in banking stories with us now on Twitter | @consumerbankers #MPWIB
CBA Applauds Senate Introduction of Transparency in Student Lending Act
On Tuesday, U.S. Senators Mark Kirk (R-IL.) and Mike Enzi (R-WY) introduced the Transparency in Student Lending Act, S.3399. This legislation would require disclosure of federal student loans’ annual percentage rate. Empowering federal student loan borrowers with the information necessary to make sound financial decisions is a commonsense proposal that should receive unanimous support. The total cost of a loan should never be withheld from students and their families. CBA commends Senators Kirk and Enzi for introducing legislation to demand the same level of transparency from the federal government as our member banks provide in the private student loan market.
Productive Week with CBA’s Home Equity and Default management Committees
We had a very productive week with CBA’s Home Equity and Default Management Committees meeting in Washington, D.C. for their semi-annual in-person gatherings. We’re expecting to continue the robust conversations next week when our CFPB and Digital Channels Committees return to town.
Congratulations to Logan Pichel of Regions Bank for being named chair of our Home Equity Committee. Thank you to outgoing Chair Nancy Elkus of Fifth Third Bank for her service to CBA. We are happy to welcome Tom Parrish as Home Equity’s new vice chair.
Congratulations to Tom Fowler of SunTrust for being named chair of our Default Management Committee. Thank you to outgoing Chair Larry Tewell of Wells Fargo for his service to the CBA.
Thank you to those who attended our Home Equity Committee meeting, including Steve Adams of Synovus, Anna Andrews of M&T Bank, Sean Andrews of KeyBank, Mark Bosma of Everbank, Matt Cammarota of Webster Bank, John Colbourne of MUFG Union Bank, Elton Costa of Santander, Pam Cunningham of TIAA, David Doyle of Bank of America, Nancy Elkus of Fifth Third Bank, Domenick Forteof Citizens, Jon Giles of Wells Fargo, Jared Hall of Bank of North Carolina, Greg Hayes of State Farm Bank,Jason Koonin of BB&T Corporation, Bonnie Lysaght of PNC Financial, Thomas Parrish of BMO Harris, Jose Pascual of BBVA Compass , Craig Peak of IBERIABANK, Logan Pichel of Regions, Jay Plum of Huntington Bank, Becky Soetaert of Commerce Bank, Larry Tewell of Wells Fargo, and Carlos Zuniga of USAA. Thank you to those who attended the Default Management Committee meeting, including Dan Boozer of Crescent Bank, Diane Carney of U.S. Bank, David DeSantis of KeyBank, Bill Duffy of Citigroup, Tom Fowlerof SunTrust, Jill Beckett Hopkins of IBERIABANK, Chad Kilby of State Farm Bank, David Moore of IBC,David Mortenson of Huntington, Claudia Porter of Bank of North Carolina, Mike Ryan of M&T Bank, Chris Shroat of Fifth Third, Mick Sladic of Capital One and Dianne Walker of First Tennessee Bank.
It was great to see so many CBA Executive Banking School students and alumni representing their banks on our committees, including Anna Andrews of M&T Bank, Sean Andrews of KeyBank, Mark Bosma of EverBank, Pamela Cunningham of TIAA, David DeSantis of KeyBank, Greg Hayes of State Farm, Craig Peak of IBERIABANK, Tom Parrish of BMO Harris Bank and Carlos Zuniga of USAA.
Thank you to John McNamara of the CFPB, Dave Pauken of Convoke and Tom Pahl of Arnall Golden Gregory, LLP for speaking to our Default Management Committee.
A special thank you to American Title for sponsoring our Home Equity Committee and Convoke for sponsoring our Default Management Committee.
Thanking Larry Tewell of Wells Fargo for his service as chair of CBA's Default Management Committee
CBA's Home Equity Committee meeting for its semi-annual in-person meeting in Washington, D.C.
CBA Executive Banking School is well represented on our Home Equity Committee.
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Congratulations to CBA Board Member Andy Harmening of Bank of the West for receiving The Terre Haute North’s Polaris Award. Andy will be recognized at a ceremony on October 10, 2016.
CBA Board Member Barry Sommers was named co-CEO of JPMorgan Wealth Management and Investment Solutions. Thasunda Ducket will succeed Barry as chief executive officer of consumer banking.
Longtime CBA family member and former Auto Finance Committee Chair Paul Wible has retired from Bank of the West. Paul has been a great ambassador for the industry for many years and will be missed.