Wells Fargo asks Fed to lift cap on growth to support customers: FT

Wells Fargo Bank branch is seen in New York City, U.S., March 17, 2020. REUTERS/Jeenah Moon

(Reuters) - Wells Fargo & Co WFC.N has asked the U.S. Federal Reserve to remove an asset cap introduced during its accounts scandal in order to allow it to support businesses and customers hit by the coronavirus economic fallout, the Financial Times reported.

The bank approached the Fed about a temporary or permanent lifting of the $1.95 trillion asset cap, which has curbed its growth and profitability since it was imposed in 2018, the FT said here on Saturday, citing people familiar with the matter.

Wells Fargo did not immediately respond to a request for comment.

Removing the cap has been a priority for Chief Executive Charles Scharf and the issue has become acute as the Fed tries to encourage banks to extend credit to customers facing income shortfalls, FT said.

Wells Fargo has suspended residential property foreclosure sales, evictions and involuntary automobile repossessions due to the coronavirus outbreak and temporarily closed some branches, adjusting operating hours of other branches, relocating employees and increasing charitable donations.

Reporting by Rishika Chatterjee in Bengaluru; Editing by Alexander Smith