San Francisco, CA – Wells Fargo faces a setback in lifting the asset cap imposed by regulators. The enforcement action taken against the bank has impacted the timeline for removing the restriction, resulting in a downgrade in its credit rating.

The Office of the Comptroller of the Currency (OCC) initiated the enforcement action against Wells Fargo, citing concerns over the bank’s progress in resolving issues related to its risk management and governance practices. As a result, the bank’s plan to lift the asset cap imposed in response to its fake account scandal has been delayed.

The asset cap, which limits Wells Fargo’s growth, was put in place in 2018 following revelations that employees had opened millions of unauthorized accounts to meet sales targets. The OCC’s enforcement action now requires the bank to address deficiencies in its risk management and governance processes before the cap can be lifted.

In response to the enforcement action, S&P Global Ratings downgraded Wells Fargo’s credit rating from ‘A-‘ to ‘BBB+’. The rating agency expressed concerns about the potential impact of the enforcement action on the bank’s operations and profitability.

The delay in lifting the asset cap is a blow to Wells Fargo, which has been working to restore its reputation and regain the trust of customers and investors. The bank’s efforts to address the issues that led to the fake account scandal have been slow, leading to continued regulatory scrutiny and reputational damage.

Despite the setback, Wells Fargo remains committed to addressing the concerns raised by regulators and improving its risk management and governance practices. The bank has stated that it will work diligently to comply with the requirements of the enforcement action and demonstrate its commitment to upholding the highest standards of integrity and transparency.