• Wells Fargo expects $1.95T asset cap could be lifted soon
• CEO Charlie Scharf signals strong confidence in progress
• Just two consent orders remain from the original regulatory actions
• Bank has spent $2B annually on risk and control upgrades
• Six consent orders cleared this year, 12 since 2019
• 150 of top 220 executives are new hires
• Scandal over fake accounts triggered Fed restriction in 2018
• Retail banking growth plans now back on the table
• Sales practices have been rebuilt from the ground up
• Fed decision timing still uncertain, says Scharf

Wells Fargo is inching closer to shedding the $1.95 trillion asset cap imposed by the Federal Reserve in the wake of its fake accounts scandal, according to CEO Charlie Scharf.

Speaking at a Bernstein investor conference on Wednesday, Scharf expressed strong confidence that the long-standing constraint could soon be lifted. 

“Our level of confidence in terms of where we are and how far we are down that road is extremely high,” said Scharf. “We’re not done, but we’re a hell of a lot closer to the end than the beginning, at this point.”

The San Francisco-based bank has been operating under the growth limitation since 2018, when regulators cracked down following revelations that employees had created millions of fake customer accounts to meet aggressive sales targets.

Since then, Wells has been engaged in a sweeping internal overhaul, overhauling risk management systems, simplifying its business model, and bringing in a wave of new leadership.

According to Scharf, 150 of the bank’s top 220 executives are new to the company, a deliberate effort to establish what he calls ‘the proper risk mindset’.

The bank has also committed around $2 billion annually to upgrading its risk and control frameworks.

So far, Wells Fargo has cleared 12 consent orders under Scharf’s leadership, including six in 2025 alone. Just two remain – one of which is the critical asset cap that has effectively frozen the bank’s ability to expand for seven years.

While Scharf declined to speculate on the Federal Reserve’s timeline for lifting the cap, he said the work already completed for other regulatory orders forms the ‘foundation’ of the remaining issues.

“Those are just very good proof points for you all to say we’re much closer to that order being lifted than…something other than that,” he said. “We feel very, very confident that it’s going to get lifted.”

Analysts have increasingly pointed to 2025 as the year Wells finally escapes what has been described as a period of inward focus.

Ken Usdin of Jefferies noted that the bank is “closer and closer to emerging from what’s been a very inward-focused period of time for the company.”

If and when the cap is lifted, Wells is preparing to aggressively re-enter the retail deposit market – a segment that was deeply implicated in the original scandal.

According to Scharf, sales practices were “front and center” in the regulatory fallout, forcing the bank to scale back nearly all retail growth efforts and rebuild from scratch.

Now, with structural reforms in place and renewed confidence from leadership, the bank sees a clear path forward.

“This isn’t just about checking boxes,” Scharf said. “It’s about building a system that’s resilient, accountable, and ready to grow again.”