Wells Fargo is continuing to sustain damage from the phony-accounts scandal that emerged in early September, according to new data published Thursday.
The number of checking accounts opened at the San Francisco bank in October was down by 44% from a year earlier. Consumer credit card applications fell by 50%.
At the same time, Wells' existing retail customers are not fleeing in large numbers, according to the data. Consumer and small-business deposits totaled $745 billion at the end of October, which was down 1% from a month earlier but up 7% from October 2015.
In response to the scandal, Wells has been releasing monthly data on trends in its retail banking business. Chief Financial Officer John Shrewsberry said during a conference call with analysts Thursday that the general patterns observed in September continued the following month.
"Our customer base remained relatively stable. However, new account openings continued to decline," he said.
Mary Mack, Wells Fargo's head of community banking, added, "In the near term, I expect many of these trends to continue … as it takes time to rebuild trust."
In an effort to revive its public image, Wells Fargo recently introduced a new advertising campaign. "Wells Fargo is making changes to make things right," says the narrator of one ad that shows horses pulling the company's iconic stagecoach.
Advertising is just one example of how the scandal is expected to result in higher expenses for Wells. Shrewsberry indicated that litigation, compliance and risk management costs are also likely to rise.
Wells Fargo's problems began on Sept. 8, when regulators revealed that the company's employees opened as many as 2 million fraudulent customer accounts over a four-year period. The scandal led to the departure of Chief Executive John Stumpf.
Between Sept. 8 and Nov. 7, Wells' stock price fell by 9%. But Donald Trump's victory in last week's presidential contest has lifted the stock prices of many banks, including Wells Fargo's.
During midday trading Thursday, the company's stock was trading at $52.67, up nearly 6% from its early-September price.
