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.
Rajesh Markan earlier this year pleaded guilty to one count of criminal fraud related to his sale of fake investments to 10 clients totaling $2.9 million.
From building trust to steering through emotions and responding to client challenges, new advisors need human skills to shape the future of the advice industry.
"The outcome is correct, but it's disappointing that FINRA had ample opportunity to investigate the merits of clients' allegations in these claims, including the testimony in the three investor arbitrations with hearings," Jeff Erez, a plaintiff's attorney representing a large portion of the Stifel clients, said.
Chair also praised the passage of stablecoin legislation this week.
Maridea Wealth Management's deal in Chicago, Illinois is its first after securing a strategic investment in April.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.