Sept 29 Oregon State Treasury said on Thursday
that it will press Wells Fargo & Co to make reforms in
its management structure and executive compensation in light of
a sales scandal that has become a major issue in Washington and
on Wall Street.
State Treasurer Ted Wheeler said that Oregon trust funds,
which have holdings of $1.14 billion with the San
Francisco-based bank, will push for better accountability by
separating the roles of board chairman and chief executive. (bit.ly/2cF7lEj)
"As a responsible shareholder, we will hold corporate
leadership accountable and demand reforms including a ban on
bonuses connected to fraud, " said Wheeler.
Oregon State Treasury will also seek to "force" the company
to claw back any previously paid compensation linked to
deceptive practices and will also investigate potential legal
action against the bank.
Wells Fargo was not immediately available for comment.
On Wednesday, California State Treasurer's Office replaced
Wells Fargo as the lead underwriter on two bond sales totaling
nearly $730 million.
Wells Fargo staff opened checking, savings and credit card
accounts without customer say-so for years to satisfy managers'
demand for new business, according to a $190 million settlement
with regulators reached early this month.
Oregon's investment program includes the Oregon Public
Employees Retirement Fund, Oregon Short-Term Fund, Oregon Common
School Fund and State Accident Insurance Fund. Its holdings with
Wells Fargo is divided between $104 million in stock and the
remainder in fixed income securities.
Earlier this month, activist shareholders of Well Fargo
filed resolutions raising the prospect of deep changes at the
bank. In addition, activist investor Needmor Fund filed a
shareholder resolution calling on the bank to split the roles of
chairman and chief executive, saying management needs strong
oversight from the board "in light of the recent scandal."
U.S. lawmakers called on Thursday for Wells Fargo Chief John
Stumpf to resign and a top House Democrat demanded the bank be
broken up because it is too big to manage.
(Reporting by Shivam Srivastava in Bengaluru; Editing by