US fourth-largest bank reports big fall in Q4 profits

SAN FRANCISCO (Xinhua) – Wells Fargo, the fourth-largest United States (US) lender by assets, on Tuesday reported a decline of 53 per cent in its 2019 fourth-quarter profits.

The quarterly profit of the San Francisco-based bank fell to about USD2.9 billion from the USD6.06 billion recorded in 2018.

Wells Fargo yielded USD19.9 billion in revenues in the quarter, down from USD21 billion during the same period of 2018.

The bank also suffered operating losses of USD1.9 billion, driven by a charge of USD1.5 billion paid to cover legal costs in connection with a fraud scandal which took place in 2016. Wells Fargo has been plagued by the scandal since, after employees were found fraudulently using the identities of customers to open millions of fake accounts to achieve their sales growth target.

The bank has since been grappling with sluggish revenue growth and high costs.

Wells Fargo CEO and President Charlie Scharf said in a conference call on Tuesday that he will work to address the challenges of low revenue growth, after taking over the role less than three months ago.

“Though we’ve had pockets of strong performance, we’re also well aware that our rate of customer and revenue growth is too low,” he said.