The California Department of Insurance plans to revoke or at least suspend Wells Fargo & Company’s WFC insurance license due to its illegitimate practices relating to the online insurance referral program.
The regulator revealed that about 1500 fake insurance policies were opened by the company without customer’s knowledge. Wells Fargo is said to have wrongly charged them with premiums.
On Tuesday, Wells Fargo’s CEO Tim Sloan commented on the regular screening of the bank’s operations during the conference hosted by Goldman Sachs. He had said, “I think actually that we’ll never say it’s finished.”
This adds to many other problems the bank is facing since the fake accounts scandal in late 2016. Since then, the company has gone through several restructuring moves. Recently, the bank closed its personal insurance business after conducting a strategic analysis of its business which began in October 2017.
Also, in June 2017, the bank agreed to divest its commercial insurance business with a view to regain focus on banking activities. It has already offloaded the crop insurance business in 2016.
Such restructuring initiatives are likely to work well for the bank, enabling it to focus more on banking activities. Also, it will give Wells Fargo the much-needed time and manpower to deal with the horde of litigations it is burdened with.
Shares of Wells Fargo have gained 6.3% year to date, underperforming the industry’s rally of 17.7%.
Currently, the stock carries a Zacks Rank #4 (Sell).
Stocks to Consider
Enterprise Financial Services Corporation EFSC witnessed a 1.2% upward estimate revision for current-year earnings, over the last 60 days. Additionally, the stock has jumped more than 7% over the past year. It currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
First Financial Bancorp’s FFBC current-year earnings estimates have been revised 2% upward in the last 60 days. Also, the company’s shares have risen 4.6% in six months’ time. It holds a Zacks Rank of 2, at present.
Federated Investors FII witnessed 3.9% upward estimate revisions for current-year earnings, over the last 60 days. In six months’ time, the company’s share price has been up more than 30%. It also carries a Zacks Rank of 2.
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