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Peter Anderson on John Stumpf Congressional Testimony (Audio) · Bloomberg Intelligence

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  Speaker 1: Broadcasting live to New York, Bloomberg eleventh to Washington, d C.
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  Speaker 1: We're gonna take stock of Wells Fargo. It has been
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  Speaker 1: a bad month for Wells Fargo shareholders and for the bank,
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  Speaker 1: the bank agreeing to pay in order to settle allegations
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  Speaker 1: related to fraudulent accounts being opened, and also the appearance
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  Speaker 1: before two sets of regulators in Washington of John Stump,
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  Speaker 1: the company's chief executive. We're gonna have more on Wells Fargo.
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  Speaker 1: Find out maybe Wells Fargo stock is on sale right now, though,
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  Speaker 1: of the finance industry's regulatory compliance effort. And now let's
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  Speaker 1: this is Bloomberg. Katherine, thank you, and now let's get
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  Speaker 1: a quick update of the benchmarks. DL and DUST for
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  Speaker 1: laverage up two hundred nine points at eighteen thousand, three
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  Speaker 1: hundred fifty three. Smp F I founded up twenty three
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  Speaker 1: three And that's a Bloomberg business flash. You're listening to
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  Speaker 1: taking stock with Kathleen and Pim Fox on Bloomberg Radio.
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  Speaker 1: The shares of Wells Fargo, they are up about two
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  Speaker 1: tenths of a percent right now forty dollars and forty
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  Speaker 1: nine cents. But earlier in the year this was a
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  Speaker 1: fifty four dollar a share stock and would know that
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  Speaker 1: Wells Fargo has not had the best of months. The
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  Speaker 1: chief executive John Stump peering before two sets of regulators
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  Speaker 1: in Washington this week to speak about allegations and efforts
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  Speaker 1: on the part of investigators to learn more about accounts
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  Speaker 1: that were open for people that for all intensive purposes
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  Speaker 1: did not exist. Here to tell us more. Peter Anderson
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  Speaker 1: he his chief investment officer, a fiduciary trust company. Peter,
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  Speaker 1: always a pleasure, Thanks for joining me. You're welcome. Now
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  Speaker 1: let's separate what is going on at Wells Fargo in
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  Speaker 1: terms of investigations and the chief executives performance and role
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  Speaker 1: in future and the actual bank because that may help
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  Speaker 1: us guide, you know, the guide the conversation about what
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  Speaker 1: the stock is actually worth exactly, and you know, I
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  Speaker 1: think they're in line with problem him Uh. This past
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  Speaker 1: week there has been a lot of focus on the
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  Speaker 1: CEO's activities and appearing before two agencies to discuss this.
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  Speaker 1: And while we don't want to understate the damage of
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  Speaker 1: the scandal, I think a lot of focus has been
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  Speaker 1: lost on the value of the stock and going forward,
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  Speaker 1: what the plans will be to recover uh investor confidence.
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  Speaker 1: And we're waiting. A lot of investors are waiting on
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  Speaker 1: the sidelines, kind of in a holding pattern, to get
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  Speaker 1: a sense of what the board of directors, for instance,
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  Speaker 1: what they're thinking and what they might uh possibly propose
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  Speaker 1: as a solution. There has been uh, they've been silent
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  Speaker 1: on the issue so far. And you're a shareholder, Yes,
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  Speaker 1: we are. We have a long term shareholder and uh,
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  Speaker 1: we have a lot of confidence and faith in the company. However,
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  Speaker 1: this period of I would say lack of disclosure is
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  Speaker 1: somewhat of concern because we think we need more information,
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  Speaker 1: as any stock analysts would to get a sense of
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  Speaker 1: what the future cash flows are in factoring in what
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  Speaker 1: their proposed solutions would be to the scandal. Well, let
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  Speaker 1: me just play you a clip of Elizabeth Warren, senator
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  Speaker 1: from Massachusetts, speaking on the panel. They were questioning the
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  Speaker 1: chief executive John Stump of of Wells Fargo. Just listen
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  Speaker 1: to what she had to say. You should resign, You
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  Speaker 1: should give back the money that you took while this
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  Speaker 1: scam was going on, and you should be criminally investigated
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  Speaker 1: by both the Department of Justice and the Securities in
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  Speaker 1: Exchange Commission. Harsh words from Senator Elizabeth Warren. Uh, Peter Anderson,
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  Speaker 1: this has got to affect the brand? Or am I wrong? Well?
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  Speaker 1: You know, I think what it should affect is the
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  Speaker 1: board of directors. You know, their duty bound to respond
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  Speaker 1: to this and UM. While the CEO certainly is in
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  Speaker 1: the center of this firestorm right now, at least in
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  Speaker 1: the public eye. You know, as an analyst, I would
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  Speaker 1: say that you need to know what the the highest
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  Speaker 1: leadership is thinking, which is higher than the CEO. Right
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  Speaker 1: is that? But he's also the chairman, right, I mean
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  Speaker 1: John Stump is also the chairman and chief executive. He is.
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  Speaker 1: And you know a lot of government experts have been
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  Speaker 1: saying for years that you should always separate those two
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  Speaker 1: authorities because of situations like this. But there are independent
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  Speaker 1: directors that certainly our duty bound to come forward and mentioned.
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  Speaker 1: Not only what I would say is disclosed and proposed,
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  Speaker 1: So disclose what's happened. And I well, John, I give
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  Speaker 1: you an example. John Chen, the chief executive of BlackBerry
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  Speaker 1: is on the board, yes, of Wells Fargo. Have you
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  Speaker 1: received any information from them? Have they given you any
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  Speaker 1: indication about anything uh? Publicly the board? As far as
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  Speaker 1: I know, the only uh disclosure they've given was the
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  Speaker 1: notice about clawback UH for the the two very highlighted
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  Speaker 1: individuals right now, the CEO and the other person. But
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  Speaker 1: other than that, we do not have anything official. So
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  Speaker 1: for instance, let me give you An example him that
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  Speaker 1: might help investors modeled future cash flows is if the
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  Speaker 1: board were to have an investor conference call and disclose
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  Speaker 1: and propose what they are thinking in terms of fixing
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  Speaker 1: this going forward. I think that would give more clarity
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  Speaker 1: to the situation. You know, as investors, most analysts are
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  Speaker 1: looking to companies for guidance rights for things as basic
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  Speaker 1: as earnings. So this I put this kind of in
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  Speaker 1: the same category, only even uh more highly ranked in
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  Speaker 1: the sense that if they can give us information and
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  Speaker 1: how they might fix this, there would be clarity and
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  Speaker 1: we could go forward with our analysis. And Peter Anderson,
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  Speaker 1: I just wanna offer a little bit up of your resume,
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  Speaker 1: uh Harvard, Yale, Northeastern Physics. Maybe the physics will come
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  Speaker 1: in handy with this with this particular situation. And also
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  Speaker 1: previously the head of multi asset wealth management at Congress
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  Speaker 1: Wealth Management. Um, is there a click a time a
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  Speaker 1: time frame here? I know we're on a time clock,
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  Speaker 1: give you about ten seconds. Is there a time clock
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  Speaker 1: for the board of directors? Well, time is their enemies
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  Speaker 1: of him, and as I would urge them to quickly
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  Speaker 1: propose a solution and then we can get back to
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  Speaker 1: our Bloomberg terminals and do the analysis. I want to
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  Speaker 1: thank you very much for joining me. Peter Anderson is
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  Speaker 1: the chief investment officer at Fiduciary Trust Company. They're based
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  Speaker 1: in Boston, home to Bloomberg, shairs of Microsoft. I mean,
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  Speaker 1: beg your pardon. Shares of Wells Fargo are up a
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  Speaker 1: quarter of our percent. Right now, you're listening to taking Stop.
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