Wells Fargo’s stock will lag behind Citi’s

Citi is cutting 20,000 jobs over the next three years after reporting a $1.8 billion loss in the fourth quarter, it’s worst performance in 15 years.

BUT, they can still grow and strengthen their business. It’s just a matter of sorting out priority and working on efficiency, whereas it’s just all about cost-cutting for Wells without any end goal (aside from higher compensation for the senior management) in mind—the large difference versus Citi.

In the end, Wells hasn’t changed and won’t change. It first tried to sweep everything under the rug when the fake account scandal came to light, and now it’s trying to flatter the numbers by laying people off without addressing any fundamental issues, including the asset cap, thereby creating a fake impression that everything is chugging along despite the regulatory purgatory. In both cases, there’s nothing but an intent to deceive outsiders.

Eventually, things will come to a head, and I don’t think Wells will survive as a going concern and get a second chance when that time arrives.

Comment! It's anonymous!

4 replies (most recent on top)

Citi is the only bank that is up in stock price.
Why? IMO they are the only one to give us a clearer narrative. Basically Citi's CEO says she needs to simplify management. They need to get rid of the middle management layers, simplify their organization.
OTOH Wells gave a muddle message about "efficiency" and "severance cost". I (and the street) was expecting more. They are going to spend .20$ a share on something they don't define. They did mentioned "fargo" and its 20 mill interactions. But did not link that to efficiency.
We all know the firm's management has gotten rid of more workers then managers. This is the "firms" definition of increasing efficiency. Efficiency = layoff severance cost of long term workers. No wonder why the unions are coming. They talk of a narrower customer focus but don't mention anything about changing the organization structure.
Long term Wells is becoming more dependent on Credit Cards which is dependent on a spending consumer and an economic soft landing. This depends on forthcoming fed rate cuts which will lower the amount of interest income.
Things that can't be predicted (but are if you don't want to be blinded by your FA that just want to sell you STOCK)

increasing consumer default
increasing layoffs and unemployment
inverted yield curve
hard landing
fiscal spending
dependency on the fed
unstable deposits
Indian execs p..sing on fellow passengers

Citi will be fine, they don't have Shart in charge.

I don't know. Sounds a lot like Wells. Also, the layoffs will be ongoing for three years. Sounds very familiar.

They have no idea how much work we do. I dare them to lay us off. I'm the only friend in my group who has mandatory overtime, let alone the opportunity to get any overtime. Tell me how laying us off makes sense? You NEED us MFer!

Thread regarding Wells Fargo & Co. layoffs

Wells Fargo’s stock will lag behind Citi’s

4 replies (most recent on top)

Post a reply