- Wells Fargo CEO Charlie Scharf said low staff turnover means the company will likely record a large severance expense in the fourth quarter.
- “We expect to receive a severance payment of approximately $750 to a little less than $1 billion in the fourth quarter, which we did not expect,” Scharf told investors.
- According to a spokeswoman for the bank, this expense is a provision for employee layoffs that Wells Fargo expects to make next year.
Wells Fargo CEO Charlie Scharf speaks during the Milken Institute Global Conference on May 2, 2023 in Beverly Hills, California. speaks during the Milken Institute Global Conference on May 2, 2023 in Beverly Hills, California.
Patrick T Fallon | Afp | Getty Images
Wells Fargo CEO Charlie Scharf said Tuesday that low staff turnover means the company will likely record a large severance expense in the fourth quarter.
“We’re expecting a fourth-quarter severance payment of about $750 billion to a little less than $1 billion, which we weren’t expecting, just because we want to continue to focus on efficiency,” Scharf told investors during a Goldman Sachs meeting. Event conference.
The company needs to be “more aggressive” in managing its workforce because employee turnover has slowed this year, Scharf said. While the bank has made progress under his tenure, Wells Fargo is “not even close to where it should be” in terms of efficiency, he added.
According to a spokeswoman for the bank, this expense is a provision for employee layoffs that Wells Fargo expects to make next year. Wells Fargo had 227,363 employees as of September.
Under the previous leadership, the staff had spread across the country. Now Scharf wants them near one of the bank’s office centers. Some employees will be offered a paid move, while others will only be offered severance pay. Workers who don’t decide to move could lose their jobs, according to a person familiar with the situation.
This story is developing. Please check back for updates.