Wells Fargo New Account Openings Tumble In Wake Of Sales-practices Settlement

By Markets MarketWatch Pulse

Shares of Wells Fargo & Co. fell 0.6% in premarket trade, after the banker reported October new account openings that fell sharply from a year ago in the wake of the sales-practices scandal. Consumer account openings fell 44% from a year ago, and 27% from September, while new credit card applications tumbled 50% year-over-year and 35% from last month. The bank said the declines were "primarily" due to a full-month impact of the sales practices settlement (Sept. 8) and reduced marketing activities. Customer-initiated account closures increased 3% from last year. Customer interactions with tellers declined 10% from a year ago, amid a 7% increase in digital dealings. Average consumer deposit balances were up 8% from a year ago, and the number of checking account customers grew 3.9%. "As expected, we continued to see declines in new account openings," said Chief Executive Tim Sloan. "We remain focused on meeting our customers' financial needs by providing great service and quality products and will provide our next update in mid-December." The stock has lost 4.9% year to date through Wednesday, while the SPDR Financial Select Sector ETF has run up 13% and the S&P 500 has gained 6.5%.

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