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Wells Fargo to appoint former community banker to head board

By DAN FREED
Reuters

August 10. 2017 8:59PM




Betsy Duke, a former Federal Reserve official and community banker from Virginia, is likely to become chairwoman of the board of Wells Fargo & Co, investors, analysts and two people with knowledge of board discussions told Reuters.

On Thursday, the Wall Street Journal reported that current Chairman Stephen Sanger will step down by early September, with Duke likely to take over as chairwoman.

Wells, the third largest U.S. lender by assets, has been wracked by a sales scandal that has grown beyond millions of unauthorized accounts disclosed nearly a year ago, to other harm to depositors and borrowers.

Investors have agitated for new leadership at the bank’s board since an annual meeting in April where investors offered relatively little support for Sanger and other directors.

A spokesman for San Francisco-based Wells Fargo declined to comment. A board spokesman also declined to comment.

Duke became a director in 2015. She was named vice chair last year after the scandal broke and then-Chairman and Chief Executive Officer John Stumpf resigned.

Shareholders who spoke about voting against Sanger complained about the board’s stewardship of the company. In recent weeks, some told Reuters they wanted Duke to become chairwoman, citing her regulatory and banking experience.

New York City Comptroller Scott Stringer, who oversees public pension funds that hold roughly 11.6 million Wells Fargo shares, has been among those calling for Sanger’s departure.

“This is welcome news,” Stringer said in a statement on Thursday.

Duke spent more than three decades as a community banker in Virginia and was a Federal Reserve governor during the 2007-2009 financial crisis. At the Fed, she was a fierce advocate for community banks affected by post-crisis regulations, according to a former colleague there.

Duke “has put a lot of leadership and effort into helping us manage a variety of regulatory reform implementations,” Wells Fargo Chief Financial Officer John Shrewsberry told Reuters in an interview last month.


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