Wells Fargo faces $1.0b fine from loan abuses

NEW YORK, Apr 15 (Reuters): Two US regulators have proposed Wells Fargo & Co pay $1.0 billion in penalties to resolve probes into auto insurance and mortgage lending abuses at the third largest US bank, overshadowing its first quarter results.

The San Francisco-based lender, which reported a quarterly profit, said it may have to restate results to reflect the final settlement. The proposed penalties were reported earlier this week by Reuters.

Analysts said that while the $1.0 billion penalty would not make a significant dent to its balance sheet, it may take the bank some time to repair the damage to its reputation. Shares of the bank fell 3.4 per cent to $50.89.

The bank, still smarting from a prolonged sales scandal in its retail banking business, found inconsistencies at its auto lending and mortgage in the summer of 2017 - leading to further probes by regulators.