Charlie Scharf, the CEO of America’s third- largest
bank, is a man enamored with the potential of the company
he leads. He sounds almost awestruck as he enumerates
the forces at his disposal. There’s the commercial bank that
serves millions of small businesses. There’s a consumer-
lending platform that accounts for more mortgages than
any other major bank. There’s a wealth management
division that has helped countless customers expand their
affluence. “The core franchise, and what we do for consum-
ers and businesses, is extraordinary,” Scharf says.
He pauses before adding, matter-of-factly: “But we
made a bunch of mistakes.”
It is mid-October, the day before Scharf ’s first anniver-
sary at the helm of Wells Fargo. The CEO is sitting in an
elegant, wood-paneled study at his home on New York’s
Long Island, speaking via a Zoom video link. For much of apandemic-afflicted year, this house has been the hub from
which Scharf has tackled one of the toughest turnaround
assignments in business. Scharf oversees an enormous,
multifaceted bank with more than 260,000 employees and
some 70 million customers. It’s a company emerging from
the most tumultuous period in its nearly 170-year his-
tory, one in which it got caught—on multiple occasions—
flagrantly abusing the trust of those customers.
Wells Fargo continues to pay for those sins with a
tarnished reputation and through the lingering impact of
severe fines and sanctions. The most damaging of those
is a Federal Reserve–imposed, $1.95 trillion cap on the
bank’s assets. As the economy reels from the impact of the
coronavirus, all banks are feeling the effects of ultralow
interest rates that clobber their profit margins. But unlike
its rivals, Wells can’t offset the impact by rapidly steppingWE LLS FARG OWHAT COMES NEXTBusted Stagecoach:Can Charlie Scharf—or Anyone—Fix Wells Fargo?HOBBLED BY THE AFTERMATH OF ITS PAST SCANDALS, WELLS FARGO
TURNED TO A TWO-TIME FORTUNE 500 CEO TO HELP IT GET BACK ON TRACK.
THE PANDEMIC SHOOK UP HIS TURNAROUND PLANS. NOW THE 169-YEAR-OLD BANK
AND ITS LEADER FACE AN EVEN STEEPER CLIMB.NEXT
BY REY MASHAYEKHI