By Lauren Tara LaCapra
NEW YORK (Reuters) – Wells Fargo & Co takes seriously allegations that some of its bankers push products customers don’t need due to pressure to meet aggressive sales quotas, Chief Financial Officer John Shrewsberry said on Tuesday.
“We have to be cautious and make sure we’re not creating incentives for people to sell products and provide services that are not in the best interest of the customer,” Shrewsberry said in an interview. “We take that deadly seriously, and we have for a long time.”
Wells Fargo is known in the banking industry for being particularly good at selling its customers multiple products, a strategy referred to as “cross-selling”. But in recent years, the bank has faced accusations by some employees, and at least one customer who filed a lawsuit, that its bankers inappropriately open accounts under customers’ names to meet sales quotas.
A group of Wells Fargo employees planned to protest the quotas outside one of the bank’s corporate offices in Minneapolis this week, according to The Guardian. An employee told the newspaper that the quota had recently dropped to 15 products a day from 20 products a day.
Wells Fargo looks into allegations of inappropriate cross-selling pressure and wants to set up the right incentives for workers, Shrewsberry said. While sales quotas are part of a “scorecard” for bankers in Wells Fargo branches, it is not the only measurement used to evaluate performance, he added.
Last quarter, the cross-sell ratio in Wells Fargo’s retail bank was 6.13 products per household, down from 6.17 in the same period a year earlier. The figure declined because the bank took in more new customers who have only one product, a checking account, for instance, Shrewsberry said. The company also divested a student-loan business that would have boosted the number of products per household.
“We’ve got a big product array and we’re trying to make that available to customers,” he said. “We’re not bashful about trying to provide them with everything they do need.”
(Editing by Peter Galloway)