Wells Fargo is reportedly in talks to sell its retirement-plan services business to Principal Financial Group for as much as $1 billion or more.
The move comes as Wells Fargo tries to trim its operations to cope with the Federal Reserve-imposed cap it has on asset growth as a result of its fake-accounts scandals.
According to a Reuters report on Sunday citing unnamed sources, the bank’s retirement plan services unit — which includes a 401(k) savings account business — could be merged with that of the insurer and financial services company. Such a deal could be reached later this month, the report says, though neither firm addressed the matter over the weekend.
On Monday, though, Wells Fargo said it “does not comment on market rumors or speculation and continues to serve retirement clients each day.”
While Wells Fargo is based in San Francisco, its wealth operations are headquartered in St. Louis. Principal Financial has its home in Des Moines, Iowa.
The news comes several months after the embattled bank sold 52 branches in the Midwest to Flagstar Bancorp. Also last year, Wells Fargo got rid of its Puerto Rico auto-loan business for about $1.7 billion.