The US Government still will not lift the asset cap. Says everything you need to know about faith in Wells Fargo.
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The asset cap WILL - one day - be lifted - maybe even sooner than most think. This could be wishful thinking, but believe things moving in the right direction.
Pasted back in so it is not completely covered by advertisement
Here is my follow up;
In a move that was expected, the central bank said Wells will have to return proceeds it gets from the Payment Protection Plan and a coming Main Street lending program either back to the Treasury Department or to a nonprofit.
Not exactly an asset cap lift and certainly no reward to Wells Fargo. They basically got permission to be a public utility with no chance for reward or a cap lift.
They are no better off and this even exposes them to more bad PR.,
32 minutes ago by Anonymous | no reactions
Post ID: @2gmz+14mqe7tR
Here is my follow up;
In a move that was expected, the central bank said Wells will have to return proceeds it gets from the Payment Protection Plan and a coming Main Street lending program either back to the Treasury Department or to a nonprofit.
Not exactly an asset cap lift and certainly no reward to Wells Fargo. They basically got permission to be a public utility with no chance for reward or a cap lift.
They are no better off and this even exposes them to more bad PR.,
Please stop spreading fake news.
The Fed did not lift the asset cap on Wells Fargo.
What the Fed did do was tell Wells Fargo that loans made under the Paycheck Protection Program and other Small Business Loans would not count towards the asset cap on a temporary basis.
Hence, Wells Fargo cannot add assets other than the aforementioned exceptions.
The asset cap on Wells Fargo remains in effect but with specific temporary modifications.
Kind of shady yet smart how Scharf used small businesses as a bargaining chip to get the asset cap lifted albeit temporarily still very clever. Not to mention makes for a good headline.
Sooooo. Asset cap is lifted today and none of you “experts” come back to recant or edit your uneducated guesses about what is going on?
The Fed doesn’t really care about team members. But the Fed is ignoring the issue that 1000’s of small businesses owners are stuck with Wells and can’t go to another back for a PPP loan. Sure there are a few community banks that are accepting new clients but most are only taking care of existing customers. Is it fair to all those business owners to watch their companies fold because of this issue?
The government needs to evaluate how many people that work for Wells Fargo are affected. Given the nose diving economy, it would be in the best interest for all involved to wrap up this asset cap expeditiously.
The way I see it the fed could at least make an exception to the asset cap for these small business loans. It makes no sense for Wells Fargo to not want to loan money to small businesses they’ve maintained a relationship with through all of the scandals. The fact that the government didn’t think about how the asset cap might impact CUSTOMERS looking to get loans during this time is irresponsible. Wells customers literally have no where to go which tells me the fed either wants to punish customers for banking with wells or they just view small businesses who bank with wells as collateral damage in their political fight. Either way nothing says “we’re trying to help consumers” more than stopping their bank from providing liquidity during a global pandemic.
I don’t understand why he even asked. His job is too deal with the 12-14 outstanding violations of law remedies that have been outstanding since 2016. The bank is deemed unsafe to consumers without the Operational Risks policy and procedures approved by the regulatory agencies. The House of Financial Services discussed the urgency to get the bank back into compliance which he acknowledged and committed too. He also acknowledged that prior senior management and the Board's continual focus on lifting the asset cap versus dealing with outstanding violations was not in the banks best interest. The coronavirus does not justify the banks request to lift the asset cap with current noncompliance condition of the bank. Why would they allow the bank to lend additional money to small businesses with the risk of doing additional wrong doing to consumers. In my opinion, his and the Boards decision to request the temporary lift of the asset cap will be criticized by the regulators.
Charlie and team are playing high stakes poker with the Fed. They want the asset cap lifted and are will to throw thousands of small businesses u see the bus to get that done. If the Fed relents, he looks like a hero. If they don’t, the customer defections will be off the charts. It won’t be in the next few months but there will be many companies moving banks. It’s been heartening to try and help customers. I know if we can’t help them, it’s just a matter of time until they downsize the number of bankers needed.