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Retirement Planning > Saving for Retirement

Wells Fargo Taps Interim Wealth Chief

By Janet Levaux

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Wells Fargo has named Tim Traudt to be its interim head of wealth management, replacing Jay Welker.

The news comes several months after Welker said he would retire following a report in The Wall Street Journal on gender-bias complaints in the unit that named him specifically. In November, the bank said it had investigated the matter and found no such bias.

Traudt has been with the bank for 21 years, according to his LinkedIn profile. He was with the Private Client Services business from 1998 to 2016, when he became head of regional management in Minneapolis.

Wells Fargo declined to comment on the matter Tuesday but confirmed Traudt’s appointment, which was reported Monday by InvestmentNews.

CEO Rumors

Separately, the bank says it has not interviewed ex-Goldman Sachs CFO Harvey Schwartz to take the reins at Wells Fargo from CEO Tim Sloan.

“Rumors that Wells Fargo’s board of directors reached out to potential CEO candidates are completely false,” said Betsy Duke, the bank’s chair, in statement shared with Bloomberg. “Tim Sloan has the unanimous support of the board, and this support has never wavered.”

Also last week, news broke that Wells Fargo was reportedly in talks to sell its retirement-plan services business to Principal Financial Group for as much as $1 billion or more. The bank is looking to to trim its operations to cope with the Federal Reserve-imposed cap on its asset growth as a result of its fake-accounts scandals.

According to a Reuters report, 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. Wells Fargo said it “does not comment on market rumors or speculation and continues to serve retirement clients each day.”

Quarterly Earnings

In the fourth quarter of 2018, Wells Fargo’s net income fell about 1.5% to $6.06 billion, or $1.21 per share, vs. $6.15 billion, or $1.16 per share, a year ago. Revenue dropped 5% to $21 billion.

As of Dec. 30, Wells Fargo has 13,968 advisors, down nearly 600 from a year ago and more than 100 from the prior quarter. Since the bank’s fake-accounts scandal erupted in fall 2016, when it had 15,086 registered reps, the bank’s wealth unit has lost 1,118 advisors.

Total assets also are declining. They stand at $1.7 trillion, down 10% from last year due to lower market valuations and net outflows, the bank says.

The unit’s net income was $689 million for the quarter, though, which is up 2% from the year-ago period but down 6% from the third quarter. Average loan balances of $75 billion, however, rose 3% from last year.

— Check out Wells Fargo ‘Has Gone Above and Beyond,’ CEO Sloan Tells Lawmakers on ThinkAdvisor.

Janet Levaux

@Think_JanetL

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