Fed, FDIC Say Wells Fargo 'Remediated Deficiencies' in 2015 Living Will

By Emily Glazer Features Dow Jones Newswires

The Federal Deposit Insurance Corp. and the Federal Reserve on Monday said Wells Fargo & Co. is back on track for its living-will regulatory assessment.

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The regulators said the bank "adequately remediated the deficiencies" in its 2015 plan and is no longer subject to "growth restrictions" that were imposed on it when the regulators said it failed the test in December 2016.

The news offers a bright spot for the San Francisco bank, which faces a potentially contentious shareholder meeting Tuesday following its sales practices scandal that erupted in the fall.

A Wells Fargo spokesman didn't immediately respond to a request for comment.

So-called resolution plans, known as living wills, are a requirement of the 2010 Dodd-Frank law, which sought to prevent bailouts partly by forcing big banks to develop a plan for how they could go through bankruptcy without taxpayer assistance. The law directed regulators to judge whether plans are credible and gave them power to sanction, or even break up, firms that are found lacking.

Wells Fargo submitted a revised plan in March 2017.

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In a letter to Wells Fargo Chief Executive Timothy Sloan dated April 24, the regulatory agencies highlighted the bank's steps in legal entity rationalization and changes to better map shared services, according to a copy shared with media.

Wells Fargo is next required to file a new living will plan by July 1, 2017, alongside other banks.

Write to Emily Glazer at emily.glazer@wsj.com

(END) Dow Jones Newswires

April 24, 2017 16:58 ET (20:58 GMT)