Tim Sloan, CEO of Wells Fargo, expressed his expectation that expenses to the third-largest bank will be reduced to around 60 percent of revenue in the second half of 2017, according to a statement issued at a conference hosted by Barclays and reported by CNBC.
Wells Fargo has not specified how much money it has set aside for litigation costs, but at its second quarter filings it stated that expenses could exceed $3.3 billion. During the first quarter filings, that figure sat at $2 billion, and these figures do not include nonrecurring costs such as unknown litigation costs. Sloan’s goal is to return the bank to its efficiency ratio that falls somewhere between 55 and 59 percent.
Yet, despite current issues, CNBC reports that Wells Fargo’s shares rose to $51.27, an increase of 1.8 percent. Sloan has remained vigilant in the bank’s efforts to right the ship.
"We've been very focused on opening every door and turning over every rock in the company," he said. "I can't promise its exactly over.”
Sloan has said the bank’s efficiency rate is unacceptable, which has largely been attributed recent issues the bank has under dealt with. Sloan expected third-quarter lending to be reduced by runoff of its mortgage portfolio, but that those declines will be offset by an increase of nonconforming residential mortgage lending.