By Steve Goldstein
Wells Fargo is planning a retreat in its mortgage activities, according to a published report.
Bloomberg News, citing unnamed sources, reported the number-one mortgage originator of commercial banks is looking to reduce its ties to outside mortgage firm s that accounted for about a third of its new-home loans last year. The company told the news agency that it’s evaluating the size of its mortgage business in light of the smaller originations market.
Wells Fargo /zigman2/quotes/203790192/composite WFC +3.38% has been fighting a number of scandals, including one in the mortgage business, where it reportedly rejected refinancing applications for Black homeowners more than white ones. The Federal Reserve has imposed an asset cap on Wells Fargo until the bank’s regulatory practices improve.
Though Wells Fargo leads commercial banks in mortgage activities, Rocket Mortgage and United Shore Financial originated more last year.
Wells Fargo shares have slipped 4% this year, an outperformance of the 10% drop for the broader S&P 500 /zigman2/quotes/210599714/realtime SPX +2.59% .