Wells Fargo Chairman and CEO John Stumpf was allowed by the board to retire immediately late yesterday ending a month-long standoff between him and the bank over running a bogus sales operation.
Under Stumpf the bank opened more than 2 million sham savings accounts and credit cards, all the while profiting by telling Wall Street how fast the bank was growing.
Stumpf’s credibility as a leader was questioned after two horrendous appearances in front of Congress earlier this month.
The CEO could not answer questions about the fraudulent sales program — instead blaming employees for the crime and saying he and senior management knew little about the program.
Stumpf also dumbfounded lawmakers with his inability to respond why the bank was paying so much compensation to execs who ran the operation but put in for retirement before the bank paid the $185 million settlement with the government.
The announcement comes two days before Wells Fargo reports earnings on Friday. Early reports calculate that Stumpf, 63, could walk away with as much as $200 million in total compensation with his retirement.
And ironically, as the bank said it was turning over a new leaf, it named 29-year Wells veteran Tim Sloan to assume the CEO role.
Deutsche Bank as I wrote Wednesday must have a backstop in place from the German government or the European Central Bank, since this maligned firm still has trading partners working with them and providing liquidity.
Well Thursday came the news that Deutsche has instituted an immediate hiring freeze, according to reports early this morning.
In early morning US futures Deutsche was trading down 2.5%.