Wells Fargo's Profit Plummets 38.8% Despite Net Interest Income Surge
Wells Fargo's annual profit plummeted by 38.8% in 2022, yet net interest income surged by 25.6%. CEO Charlie Scharf, who has been streamlining the bank's operations, will receive $24.5 million for the year, the same as in 2021. This comes amidst a $3.7 billion settlement with the Consumer Financial Protection Bureau and a review of hiring practices following allegations of fake job interviews.
Scharf, who took the helm in 2019, has been focusing on offloading non-core business units and improving the mortgage division. Despite facing criticism over racial disparities in mortgage refinancing approval rates, he asked the board to set his compensation below the target amount of $27 million. This decision reflects his commitment to the bank's ongoing transformation journey.
The bank's profit decline can be attributed to a rise in provisions for credit losses, reflecting economic uncertainty. However, net interest income increased significantly due to higher interest rates and loan growth. Wells Fargo is the third of the six largest U.S. banks to report CEO compensation so far this year.
Wells Fargo's 2022 results show a mixed picture, with profit down but net interest income up. CEO Charlie Scharf's compensation remained steady at $24.5 million, reflecting his focus on the bank's transformation and his request for no raise. The bank continues to address past issues, including a recent $3.7 billion settlement and a review of hiring practices.
