Charles Scharf, chief executive officer of Wells Fargo & Co., listens during a House Financial Services Committee hearing in Washington, DC, U.S., on Tuesday, March 10, 2020.
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Chief Executive Officer Charles Scharf said Wells Fargo is seeing borrower defaults start to rise from lows hit during the pandemic.
“We can say that the bottom has been reached,” he said at Goldman Sachs’ US Financial Services Conference.
Scharf said the company is starting to see a “very, very small increase in crime,” describing the change as “not significant, but only slightly different from what we’ve seen in the past.” last quarter.”
Last year, the industry braced for what it believes will be a wave of defaults when the pandemic hits. Instead, government aid and stimulus programs emerged to stem the damage. Follow data tracked by the Federal Reserve.
Banks this year, including Wells Fargo, Free up billions of dollars from loan loss provision after credit costs better than expected, boosting profits.
“These cushions are already pre-loaded with all of this liquidity and labor demand…will continue to provide a cushion for a period of time. But at some point, as we step in. In the year 22, hopefully there’s going to be a lot more than in the beginning, there’s got to be some standardization,” said Scharf. “The fees won’t stay at this level.”
—Hugh Son of CNBC contributed to this report.
