Menu
Banking Exchange Magazine Logo
Menu

Wells Fargo sells $600bn fund arm to private equity firms

GTCR and Reverence Capital Partners are acquiring Wells Fargo Asset Management

  • |
  • Written by  Banking Exchange staff
  • |
  • Comments:   DISQUS_COMMENTS
Wells Fargo sells $600bn fund arm to private equity firms

Wells Fargo is selling its asset management business, with $600 billion in assets, to private equity firms GTCR and Reverence Capital Partners.

The firms are acquiring the business for $2.1 billion with plans to establish it as an independent entity.

This transaction is expected to close in the second half of 2021 and Wells Fargo will continue to hold a 9.9% stake in the business, operating as a client and distribution partner.

The business will still be led by Nico Marais and former Legg Mason CEO Joseph Sullivan is being brought in as executive chairman.

Wells Fargo Asset Management will be rebranded upon completion of the deal and target a range of global institutional, retirement and wealth management clients.

As part of its plans, GTCR and Reverence Capital have committed to making “substantial investments” in technology and retaining portfolio management talent.

"The organization is poised to provide further innovation in the investment marketplace while continuing to deliver high quality products to its clients,” said GTCR managing director Collin Roche.

"The team, underpinned by its diversity, client-orientation, and collaborative culture, has delivered strong performance, and we will work to reinforce these values and sustain this performance. Along with our partners at Reverence Capital, we are committed to the long-term success of the organization."

Wells Fargo has been attempting to sell its asset management arm since October 2020 following a long-running fake accounts scandal at the bank.

This scandal, which first arose in 2016, involved over 500,000 fake credit cards and 1.5 million false deposit accounts being set up to hit targets.

In February 2020, the bank agreed to pay a $3 billion settlement with the government with the Office for the Comptroller of the Currency also levelling significant fines at three former executives.

This included former CEO and chairman John Stumpf who was ordered to personally pay $17.5 million. He was fined again in November 2020, this time by the SEC, for his oversight failures in the scandal.

Stumpf, who has neither admitted nor denied the charges, agreed to the $2.5 million fine to avoid further violations.

back to top

Sections

About Us

Connect With Us

Resources

Webinar: From KYC to IDV

How three leading banks are utilizing cutting-edge
digital tools to onboard, win, and wow customers

Time/Date: June 23, 2021 11:00 a.m. ET

Digital adoption, already moving at warp speed, accelerated seven years into the future during the COVID-19 pandemic. As the number of bank branches continues to fall, with at least one study predicting all branches will disappear by 2034 (Fox Business) and foot traffic declining (Vox), today’s most innovative banks are charting a new, digital-first path to win over customers while increasing security, meeting KYC compliance requirements, and winning customers to drive revenue.

In this webinar, you’ll hear from John Baird, Founder & CEO of Vouched, Tyler Crawford, COO of Bankers Healthcare Group, Anand Sathiyamurthy, CPO of Flagstar Bank and Daniel Sheehan, Chairman & CEO of Professional Bank as they describe their vision for digital transformation and how customer expectations are changing to digital first. They’ll also explore how fostering an innovation mindset creates new ways to tackle complex KYC problems and allows them to quickly compete in new markets and win customers.

REGISTER NOW!

This webinar is brought to you by:
Vouched Logo