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The San Francisco bank's solid gains in auto, business and other lending could bode well for other large and regional banks, analysts say.
January 14 -
Wells Fargo and U.S. Bank are among the institutions still offering the controversial loan product in the face of tough guidance that took effect in November.
January 3 -
The short-term consumer loan product will either have to be overhauled or ditched in the wake of new regulatory guidance.
November 26
Within the next few months, Wells Fargo (WFC) expects to decide whether to continue offering a controversial consumer loan product that has come into regulators' crosshairs, Chief Financial Officer Timothy Sloan said Tuesday.
The company's Direct Deposit Advance bears a strong resemblance to a payday loan. Customers get charged $1.50 for every $20 they borrow, with full repayment usually due within no more than 35 days.
In late November, federal banking regulators
Only six banking companies currently offer so-called deposit advances, and just four of them Wells Fargo, U.S. Bancorp (USB), BOK Financial (BOKF), and Guaranty Bank of Wisconsin are subject to the new guidance from the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corp.
In an interview Tuesday, Wells Fargo's Sloan declined to commit to a specific timetable for action. But he said the company will likely make a decision in the "next few weeks" or the "next few months."
In a letter to regulators last year,
But Sloan said Tuesday that Wells Fargo has yet to reach a final decision about whether it will stop offering deposit advances. "We're studying how to do that, if we decide to do it," he said.
One of the issues that Wells Fargo is working on, Sloan said, is how to deal with existing customers in the event that the product is discontinued.
Sloan's comments, although brief, were the most expansive remarks that official at any of the affected banks have made since the guidance was finalized. Other banks have released brief written statements saying they are evaluating the new guidance.