Wells Fargo Explores Selling Private-Label Card Unit

The bank hasn’t made a final decision on a sale and could still opt to keep it, the people said. A company spokesperson declined to comment on confidential deliberations.

Disposing of the unit would mark a shift for the bank from a half-decade ago. At an investor conference in 2014, then-Chief Financial Officer John Shrewsberry said the firm was looking to further build its private-label portfolio.

But the firm never closed the gap with private-label giants such as Synchrony Financial, Citigroup Inc. and Capital One Financial Corp.

While Synchrony commands roughly 40% of the private-label card market, Wells Fargo has a relatively small slice, according to the Nilson Report, an industry publication.

It estimates Wells Fargo’s share of spending on private-label cards dipped slightly to 5.75% in 2019, while the bank’s share of borrowings slipped nine basis points to 3.63%.

Scharf is preparing to lay out his vision for turning around the embattled lender after years of scandals.

He’s promised a simpler structure that focuses on key units, telling analysts last month that the firm will “continue to exit some things which aren’t core to the U.S. banking franchise.”

Related: Wells Fargo Makes Sizeable Cuts to Advisor Force