Wells Fargo & Company 's WFC CEO Tim Sloan, in a bi-monthly meeting held on Thursday, said that the company plans to reduce its workforce by 5-10% in the next three years, as it seeks to transform itself into a more efficient and customer-oriented firm.
Though the move is likely to impact about 13000-26000 jobs, per the headcount disclosed in the latest quarterly filing, it would lend support to the company from rising costs due to involvement in several legal hassles.
The company states that changing customer preferences to digital modes of banking should be accounted for the layoffs. Also, it said that this reduction is likely to reflect displacements as well as normal team member attrition over the period.
During the meeting, Sloan was positive on the progress the Wall Street Biggie has made so far by streamlining operations, improving risk control methods and offloading of unprofitable business.
Moreover, he noted that Wells Fargo will remain focused on enhancing customers' experience by prioritizing spending to deliver client expectations and enhancing existing and introducing new products.
He said, "We are continuing to transform Wells Fargo to deliver what customers want - including innovative, customer-friendly products and services - and evolving our business model to meet those needs in a more streamlined and efficient manner."
Wells Fargo continues to face the challenges that Federal Reserve had imposed earlier this year by limiting its asset growth along with persistent legal costs. However, its efforts to move past previous wrongdoings and regain its lost reputation seem encouraging. Further, the bank's impressive cost-control plan for 2018 will help it deal with the pressure on costs.
The stock has gained 5.8% over the past six months compared with the industry 's growth of nearly 3%.
Stocks to Consider
U.S. Bancorp's USB earnings estimates have been revised slightly upward in the past 60 days. Additionally, the stock has gained nearly 3% in a year's time. It currently has a Zacks Rank of 2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
Comerica Incorporated's CMA current-year earnings estimates have been revised 1.2% upward over the past 60 days. Over the past year, the company's share price has been up 29%. It currently carries a Zacks Rank #2.
The Bank of New York Mellon Corporation BK current-year earnings estimates have remained stable over the past 30 days. Additionally, the stock has jumped 2% in the past 12 months. It currently carries a Zacks Rank #2.
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