Wells Fargo Formally Separates Chairman, CEO Roles

Wells Fargo & Co. has amended its bylaws to formally separate the roles of chairman and chief executive and will require its chairman to be independent as it tries to rebuild customers' trust following a scandal over banking sales practices.

When former chairman and CEO John Stumpf resigned in October, lead independent director Stephen Sanger replaced him as chairman, and president and operating chief Timothy Sloan became CEO.

But four institutional shareholders called on the bank to take further formal steps to improve its governance.

Mr. Sanger said in a statement that the bylaw change would help improve the board's oversight of management and that investigations of the bank's retail sales practices continue.

Wells Fargo came under intense scrutiny this fall over revelations that bank employees had opened as many as two million accounts without customers' knowledge. Mr. Stumpf stepped down after coming under fire for his handling of the fallout.

The move to separate the roles also comes after U.S. Comptroller of the Currency Thomas Curry said this week that regulators should consider requiring federally chartered banks to do so. He said the change would eliminate potential conflicts of interest that can exist when the same individual serves in both roles.

In separating the positions, Wells Fargo joins Citigroup Inc. as the only other large U.S. bank to keep the roles separate, a change it made in the financial crisis. Bank of America Corp. split the roles under shareholder pressure during the crisis, but the board gave the chairman job to Chief Executive Brian Moynihan in 2014.

Write to Maria Armental at [e-mail]

(END) Dow Jones Newswires

December 01, 2016 16:05 ET (21:05 GMT)

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