Warren Buffett says Wells Fargo needs to look outside Wall Street for new CEO
Famed investor Warren Buffett is urging Wells Fargo to look outside Wall Street for the embattled lender’s new top executive.
Analysts have cited a number of potential candidates that could fill the vacancy left by former CEO Tim Sloan, including JPMorgan Chase's CFO Marianne Lake and investment banking head Daniel Pinto.
But Buffett, who is Wells Fargo’s largest shareholder, says the San Francisco-based financial firm should not choose from firms like Chase and Goldman Sachs.
“They just have to come from someplace [outside Wells] and they shouldn’t come from Wall Street,” he told the Financial Times. “There are plenty of good people to run it [from the Wall Street banks], but they are automatically going to draw the ire of a significant percentage of the Senate and the US House of Representatives, and that’s just not smart.”
While such a criteria would eliminate many of the potential prospects cited by analysts and others, Wells Fargo could look to the federal officials – like Neel Kashkari, current president of the Federal Reserve Bank of Minneapolis – or a non-Wall Street financial firm, including PNC Financial Services Group CEO William Demchak.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| WFC | WELLS FARGO & CO. | 58.75 | +1.57 | +2.75% |
Hours before Sloan announced his intention to retire, Buffett voiced his strong confidence in the Wells Fargo veteran. But experts largely viewed his departure as necessary for the lender to move past a slew of scandals, many initiated under former CEO John Stumpf.
Like Stumpf, Sloan drew the scorn of top lawmakers including Sen. Elizabeth Warren, D-Mass., and House Financial Services Chairwoman Maxine Waters, D-Calif.
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Analysts say the bank must pick someone who can win over congressional skeptics.
Warren has “fired two CEOs,” Dick Bove, senior research analyst at Odeon Capital Group, previously told FOX Business. “You can’t ignore her, you just can’t do that.”