Cowen is forecasting trouble for Wells Fargo & Co. through next year, with mounting risk as Democrats aim for the bank.
Analyst Jaret Seiberg flagged remarks by House Financial Services Chairman Maxine Waters, who last week indicated she’ll subject Wells Fargo to extra attention. That includes calling for more testimony and focusing on the board and new CEO Charles Scharf, Mr. Seiberg said.
“Wells Fargo does not appear close to putting its Washington troubles behind it,” Mr. Seiberg wrote in a note.
Given the tension, he said it’s hard to see how the Federal Reserve could vote to lift the asset cap it imposed on the bank next year. And he added that the Fed lifting its growth restrictions might not matter much as the Comptroller of the Currency likely has separate, confidential enforcement actions in effect.
Mr. Seiberg pointed to an even “worse outcome” brewing for Wells Fargo: getting dragged into the 2020 presidential election.
“For now, Democrats like Elizabeth Warren are mostly focused on private equity and big tech,” he said. “Calls to break up big banks or impose a separation between commercial and investment banking have been muted. That could change if attacks by House Democrats get traction.”
Democrats winning would mean the bank “will be even more exposed to onerous policy developments,” Mr. Seiberg warned.
On Friday, Credit Suisse’s Susan Roth Katzke said banks face a “source of uncertainty” with the 2020 election. She noted that bank stocks have historically outperformed in the year leading up to a presidential election, while “risk is heightened by polarization of policy and macro uncertainty,” with a focus on regulation.
Also last week, Odeon’s Dick Bove downgraded Wells Fargo to sell from hold as the bank “appears to be directionless at the moment,” even with its compelling consumer business. Wells Fargo may ultimately “fashion a business plan that has merit, but it does not have one now,” Mr. Bove wrote in a note.
Elsewhere, a Commonwealth team in Massachusetts converts to Cetera, while Janney draws four former Wells Fargo advisors to its Radnor, Pennsylvania office.
Clients say he copied the boss on his emails - and now they can't touch their cash.
He wired millions to his own accounts and told investors the fund was winning.
The partnership arrives as most small business owners near retirement age still don't have a formal succession plan in place.
A spokesperson for the estate planning fintech cited AI's reshaping of the industry as Trust & Will restructures its business.
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
Direct indexing is on pace to outgrow ETFs and mutual funds. Northern Trust's Ken Lassner explains why the advisors who get it wish they had started sooner.
