Category Archives: Market News

Wells Fargo won’t be allowed to grow unless problems fixed: Fed’s Powell

WASHINGTON/NEW YORK (Reuters) – Wells Fargo Co (WFC.N) must keep a lid on its growth until the bank has hardened its risk management policies to prevent any further abuse of its customers, said Jerome Powell, chairman of the Federal Reserve.

In February, the Fed ordered Wells Fargo to freeze its balance sheet, keeping its assets below $1.95 trillion, until it put new checks on senior managers and gave the board new powers to sniff out abuses.

“We do not intend to lift the asset cap until remedies to these issues have been adopted and implemented to our satisfaction,” Powell wrote in a letter to U.S. Senator Elizabeth Warren seen by Reuters.

Wells Fargo has so far failed to satisfy the Fed and the bank is months behind schedule on submitting an acceptable reform plan, Reuters reported last week.

A bank representative did not immediately respond to a request for comment on Powell’s letter. Wells Fargo executives have previously said that they expect the cap to be lifted during the first half of next year.

Warren, a Massachusetts Democrat, has been a vocal critic of Wells Fargo and its Chief Executive Tim Sloan. In October, Warren wrote a letter asking the regulator not to remove the asset cap until Sloan is removed, charging that Sloan was “deeply implicated” in the misdeeds of the past. Wells Fargo has called Sloan’s 30-year tenure at the bank an asset and said he has the full support of its board.

On Monday, Warren faulted the bank for being late with its reform plan and said Sloan must go.

“Wells Fargo is already months behind,” Warren said in a statement. “If the Fed is serious about changing the practices at Wells Fargo that have cost customers their homes or cars or credit scores, it must insist on new leadership at the bank.”

The Wells Fargo sanctions were rooted in a sales practices scandal that broke open in 2016 when it was reported that employees had opened potentially millions of phony accounts in customers’ names without their permission. In his letter to Warren, Powell wrote that what happened inside the bank was “outrageous,” but declined to say whether or not Sloan should continue to lead the bank.

Since the phony accounts scandal, Wells Fargo has said it found abuses in auto insurance, small business loans, mortgage lending and other business lines.

Once Wells Fargo has satisfied the terms of the February settlement, Powell wrote, the Fed board will decide whether or not the bank can grow.

“The decision about terminating the asset growth restriction imposed on Wells Fargo will be made by a vote of the Board,” Powell wrote in the Nov. 28 letter.

Reporting by Patrick Rucker in Washington and Imani Moise in New York; Editing by Neal Templin and Phil Berlowitz

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Struggling hedge funds cling to dollar, U.S. yield curve bets: McGeever

LONDON (Reuters) – Hedge funds have struggled badly in 2018, but would be faring far worse were they not on the right side of two of the most reliable trades of the year: a flattening U.S. yield curve and a stronger dollar.

Both trends remain in place, and as the latest data show, speculators look like holding onto them for the rest of the year.

Funds increased their net long dollar position against a range of developed and emerging-market currencies by nearly $2 billion to $32.09 billion in the week to Dec. 4, according to Commodity Futures Trading Commission figures. That’s the biggest cumulative bet on a rising dollar in three years.

They also increased their net short position in two-year Treasuries by the second largest amount this year and upped their short position in 10-year bonds by only a fraction, effectively a bet that the gap between two- and 10-year yields will narrow.

The dollar is up 5 percent so far this year — up 10 percent from the low in February — while the 2s/10s yield curve is the flattest in over a decade, coming within 10 basis points of recession-warning inversion last week.

(For a graphic on ‘U.S. yield curve’ click

That may suggest these trades are stretched and due for a bout of year-end profit-taking. Perhaps, but they have been among the few shafts of light in a gloomy year for the hedge fund community.

Barclayhedge’s main hedge fund index is down 2.48 percent so far this year and its macro fund index is down 4.06 percent, while the fixed income arbitrage index is up 2.33 percent. These are the poorest annual performances for years.

Eurekahedge figures paint an even bleaker picture. Its main hedge fund index is down 2.40 percent so far in 2018, the worst year in a decade and on course for only the third annual loss since 2000.

The CTAs/Managed Futures index is down 4.21 percent and the Macro Index is down 2.55 percent year to date, both heading for their only annual loss since 2000. Even the Fixed Income index, up 0.37 percent, is having its worst year since 2008.

And that’s despite speculators, by and large, being on the right side of the dollar and yield curve trades, central to which has been how much further the Federal Reserve plans to tighten U.S. monetary policy.

Up until a few weeks ago, the Fed seemed committed to raising rates at least three times next year. Growth is steady, unemployment is at a 50-year low, and most of the incoming economic data is still looking fairly solid.

Yet markets didn’t quite buy into that glass-half-full view. Hedge funds may have extended their short two-year bonds position — it’s now 361,560 contracts, within 1,000 of the record short from last month — but have dramatically cut back their short position in longer-dated bonds.

(For a graphic on ‘CFTC 2-year Treasuries positions’ click

The result has been a collective bet that the yield curve will flatten, which is exactly what has unfolded. Parts of the curve at the short end have even inverted already, such as the 3s/5s curve.

If curve flattener trades are to be unwound, it will most likely be led by the short end. Funds’ net short position in 10-year Treasury futures is a sizeable 293,186 contracts, but it’s worth bearing in mind that it was more than 750,000 as recently as September.

A year ago, funds were actually long 10-year bonds, so positioning in this part of the curve isn’t extreme.

(For a graphic on ‘CFTC 10-year Treasuries positions’ click

Hedge funds’ dollar bets look more stretched, especially now that the Fed’s path next year is less clear-cut. Officials from Chair Jerome Powell down now suggest rates may be close to “neutral”, and money markets no longer fully price even one quarter-point rate hike in 2019.

Yet even if the Fed does take its foot off the gas next year, the likelihood of euro zone, UK, or Japanese policy being tightened to any significant degree next year remains small.

The dollar could continue to enjoy its yield advantage for a while yet.

(The opinions expressed here are those of the author, a columnist for Reuters)

By Jamie McGeever, editing by Larry King

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The end of Fannie, Freddie conservatorship? Trump reportedly picking Mark Calabria to lead FHFA

Vice President Mike Pence’s chief economist is said to be next in line to head the Federal Housing Finance Agency, according to this article in the Wall Street Journal.

Mark Calabria is said to be President Donald Trump’s pick to next lead the overseer of Fannie Mae and Freddie Mac.

The current head of the FHFA, Mel Watt, is set to depart in January. Watt also recently faced some serious allegations involving his alleged conduct while in his role.

Prior to serving as Mike Pence’s chief economist, Calabria served at the Cato Institute and has long been an advocate for housing finance reform. As Pence’s economist, Calabria famously called for the end of the conservatorship of Fannie Mae and Freddie Mac.

Five years ago, Calabria expressed distaste at the way the government-sponsored enterprises were being run. In 2013, Freddie Mac failed to refer nearly 58,000 foreclosed homeowners who owed $4.6 billion on their guaranteed loans, thereby neglecting its chance to seize properties from those who defaulted on mortgage payments, a watchdog noted.

Calabria didn’t like the news.

“It’s a fairly small number in the scheme of things,” explained Calabria, at the time. “But I think it reinforces the current nature of mortgage finance policy, which is not to hold borrowers responsible. This isn’t just about Freddie, but it’s also about these borrowers sticking it to the taxpayer.”

Now, Calabria could soon be in charge of the regulator that oversees the GSEs. And that could lead to serious winds of change at the GSEs and for the U.S. housing economy. 

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Minneapolis is about to abolish single-family residential zoning

In a move that strikes a blow against decades of racial inequality and could prove to a boon to multifamily developers, the city of Minneapolis is on the verge of ending single-family residential zoning.

The move is part of the “Minneapolis 2040” plan, which was recently approved by the Minneapolis City Council.

Under the plan, duplexes and triplexes would be allowed in neighborhoods that only previously allowed single-family housing.

The Minneapolis Star Tribune provides more details on the plan, which is hardly limited to zoning changes.

From the Star Tribune report:

The 2040 plan has gained national attention for its citywide upzoning. It would allow the construction of multifamily housing, such as duplexes or triplexes, in neighborhoods that for decades have been reserved for single-family homes.

The nearly unanimous vote was a victory for City Council President Lisa Bender, whose advocacy for the plan overcame substantial opposition from residents who said it would lead to the bulldozing of neighborhoods.

Bender said the plan “sets a bold vision for our city to tackle racial exclusion in housing and climate change head on, but it does it in a way that is incremental and that is gentle.”

According to the report, the 2040 plan also seeks to “eliminate racial disparities, fight climate change, increase transportation options and improve access to jobs.”

The report also states the original 2040 plan called for fourplexes to be allowed in single-family areas, but that was lowered to triplexes after the city received thousands of comments on the plan.

The plan received nationwide attention. Slate, for example, called the plan the “most important housing reform in America.”

Here’s a taste of Slate’s coverage of the plan:

Minneapolis will become the first major U.S. city to end single-family home zoning, a policy that has done as much as any to entrench segregation, high housing costs, and sprawl as the American urban paradigm over the past century.

On Friday, the City Council passed Minneapolis 2040, a comprehensive plan to permit three-family homes in the city’s residential neighborhoods, abolish parking minimums for all new construction, and allow high-density buildings along transit corridors.

“Large swaths of our city are exclusively zoned for single-family homes, so unless you have the ability to build a very large home on a very large lot, you can’t live in the neighborhood,” Minneapolis Mayor Jacob Frey told me this week.

As both reports note, it will likely take a year before the changes in the plan begin to take effect, but the plan will certainly be worth watching as it could prove to be a blueprint for other cities to follow in the future.

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In a tight labor market, companies bet big on five-year rewards

NEW YORK (Reuters) – In the old days, longtime employees in the United States were honored with a gold watch after 30 years or so at a company.

Well, they have got nothing on Hadas Streit.

The senior vice president at the global public relations firm Allison + Partners recently returned from a one-month paid sabbatical, awarded to staffers after only five years at the company. During that time, she rented a house in Cape Cod for a couple of weeks.

Streit, who is based in New York, swears she did not check her work email once.

“The last time I wasn’t working was back when I was a kid,” says Streit. “It’s a little scary, but when you come back, you feel refreshed, with new drive, and ready to work again.”

Streit is not alone in enjoying some fast-tracked work recognition. Workplace anniversary awards are offered by 63 percent of companies, according to the 2018 Benefits Survey of the Society for Human Resource Management. And rewards rose 9 percent in a single year.

The five-year honor has taken particular hold in work cultures like Silicon Valley, where intense lifestyles and endless project deadlines can easily lead to employee burnout.

Social media giant Facebook (FB.O) has been offering its “Recharge” program since 2015: It is a 30-day period (the days have to be continuous, but do not have to be taken right at the five-year mark) which staffers can use as an “uninterrupted break to refuel and relax,” said Tudor Havriliuc, Facebook’s vice president of compensation, benefits and global mobility.

So what is going on? Well, just take a look at the nation’s employment situation: Joblessness is near historic lows, currently at 3.7 percent of the population, according to the Bureau of Labor Statistics. In a recent poll of small business owners, 37 percent reported having openings they could not even fill – the highest figure in the survey’s history, according to the National Federation of Independent Business.

At the same time, companies are reluctant to boost wages, in order to keep profits up. So, one way to honor employees and improve retention, without a huge wage hike, is the service anniversary award.

Slideshow (3 Images)

And since hardly anyone stays with a company 30 or 40 years these days, more companies are honoring longevity after only a few years on the job, when staffers are in their prime and most likely to be scouted by rival firms or executive recruiters.


“In today’s job market, there are more jobs than applicants, and the competition for top talent is greater than ever,” said Vanessa Hill, spokeswoman for the Society for Human Resource Management. “Organizations are identifying which compensation benefits are most helpful in getting employees in the door and keeping them – and service anniversary rewards are trending up.”

But it is not just sabbaticals that employees are enjoying after only a few years on the job.

SIB Fixed Cost Reduction, which helps businesses find savings in their regular monthly expenditures, offers employees a fat check for $50,000 after they reach their 5-year work anniversary.

“The thought process was, people don’t stick around at jobs for a long time anymore,” said Dan Schneider, chief executive officer of the Charleston, South Carolina-based company. “A lot of times, people leave for a little more pay. So an award like this shows you can still grow within your company, and earn more money, without having to leave.”

Most of SIB’s competitors might hold onto staffers for 24 months, Schneider said. By tempting employees with a gigantic check, his own firm now boasts average retention of four years.

Of course, as humans typically have bad money instincts, there is always the possibility that they might spend these milestone cash awards on unnecessary stuff.

So, instead of using a cash gift to glam up your lifestyle, devote it to something else that will improve your situation for the long-term – like wiping out student debt, a downpayment for a house or a wedding, advises SIB’s Schneider.

And if it is a sabbatical you are entitled to, here is some advice from Hadas Streit: Use it.

After all, the purpose is to have fun, recharge and come back reinvigorated. If you end up checking your work e-mail every five minutes, you are defeating the purpose – and cheating both yourself and your employer, Streit said.

“When I tell people I got a month off after five years on the job, folks are in shock because they never heard of that before,” she says. “I feel like I took a really long nap.”

Editing by Lauren Young and Bernadette Baum

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Medicare Advantage plans get unfair push from U.S. government: critics

CHICAGO (Reuters) – Insurance companies do not need any help marketing Medicare Advantage plans – just ask anyone over age 65 about the pitches that clog their mailboxes every year during the fall enrollment period, or check out the television ads that flood cable channels.

So why is the federal government giving these private all-in-one plans an extra marketing push? That is the question raised by two consumer advocacy groups, who charge that the Centers for Medicare Medicaid Services (CMS) is improperly urging enrollees to pick Advantage plans in ways that tip the scales against traditional fee-for-service Medicare.

Medicare Advantage plans roll together coverage for hospitalization, outpatient services and prescription drugs that are provided through separate parts of traditional Medicare. In

a letter sent last month to CMS Administrator Seema Verma, the Medicare Rights Center and the Center for Medicare Advocacy criticize a suite of online tools on the Medicare website that aim to help consumers decide between Advantage and traditional Medicare. The tools make “overly-broad suggestions” that encourage Advantage enrollment when “more nuance is required, and by failing to present individuals with the full array of Medicare coverage options,” the letter states.

The consumer groups also say that a CMS email campaign during fall enrollment (which ends on Dec. 7) is improperly biased toward Advantage plans. The campaign includes messages with subject lines such as “Could Medicare Advantage be right for you?” and “Get more benefits for your money,” and contain messages such as “check out Medicare Advantage.”

CMS did not respond to requests for comment on perceptions that its Advantage promotions lack balance, or who it regards as the target audience.

This is not the first time CMS has been accused of bias in favor of Advantage. Earlier this year, advocacy groups called foul over language contained in a draft of the 2019 Medicare handbook that CMS sends to enrollees every year. ( CMS later responded by fixing the language in the final draft of its handbook “Medicare You.”

Advantage plans differ from traditional fee-for-service Medicare in several ways. They receive capped per-enrollee payments from the federal government, rather than the fee-for service model used in the traditional program. Advantage plans must cap enrollees’ out-of-pocket expenses; and most wrap in prescription drug coverage. Beneficiaries typically must use a network of providers, while enrollees in traditional Medicare can see any healthcare provider that accepts Medicare – and most do.

Advantage plans often save money for enrollees on premiums, since most pay no additional fee for prescription drug coverage and do not need Medigap supplemental policies, which cap out-of-pocket costs.

And the business is doing just fine without cheerleading by CMS. Enrollment has more than tripled since 2005 to 20 million beneficiaries, according to the Kaiser Family Foundation. The Congressional Budget Office projects enrollment will rise from 34 percent to 42 percent of the Medicare population by 2028.

The companies running plans are enjoying a boom in revenue – for example, UnitedHealth Group Inc, the nation’s largest seller of Medicare Advantage plans, reported a 15.2 percent revenue jump in its Medicare business during the third quarter compared with the year-earlier period, to $18.8 billion.


The Trump administration is not the first to play the role of Advantage booster. “The past few administrations have been very much in favor of private plans,” said Gretchen Jacobson, associate director with the Kaiser Family Foundation’s Program on Medicare Policy. She notes that the administrations of Barack Obama and George W. Bush, as well as Congress, have encouraged growth of the program through rulemaking and legislation that made it possible for Advantage plans to add benefits such as vision care and gym memberships, and to cap patient out-of-pocket costs. At the same time, regulators have given Advantage plans greater latitude to set their own rules for certain types of coverage.

But the current round of government support for Advantage plans is louder than anything seen in earlier administrations, said Joe Baker, president of the Medicare Rights Center. “I’ve been involved in Medicare since 1994, and I can’t remember this kind of government promotion for a particular part of the program,” he said.

Baker adds that his group has no problem with CMS providing education to consumers – but only if it is balanced. “People have two options, and CMS should be communicating about the advantages and disadvantages of both – this approach is lopsided.”

The motivations are not clear, Jacobson said. A research paper she co-authored recently in the New England Journal of Medicine ( concludes that evidence is mixed as to whether Advantage saves the government money or is actually increasing government spending.

The jury also is out on the quality of care provided by Advantage plans, Jacobson’s study found, especially for people with serious chronic conditions. These patients are disenrolling from Advantage plans at high rates, according to numerous rigorous research studies. “That is a real concern as Advantage enrollment grows,” she said.

Reporting and writing by Mark Miller in Chicago; Editing by Matthew Lewis

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Investors flee bonds and stocks in turbulent week for growth and trade

LONDON (Reuters) – Investors pulled billions from bonds and stocks this week as U.S. bond movements triggered fears over global growth and a trade tussle between the United States and China heated up, strategists at Bank of America Merrill Lynch said on Friday.

This week’s selloff was precipitated by the inversion of part of the U.S. yield curve, which has previously been a reliable indicator of an impending recession.

It deepened on Thursday after the chief financial officer of China’s Huawei was arrested on a U.S. request, sending markets spiraling further as investors predicted a worsening of relations between the world’s two biggest economies.

The anxiety drove investors to pull $5.2 billion from equity funds and $8.1 billion from bond funds, according to EPFR data cited by BAML.

“Markets starting to price in recession, but policymakers yet to price in recession,” argued the BAML strategists.

Equity outflows were made up of opposite flows in ETFs and mutual funds, with $5.3 billion driven into ETFs while $10.5 billion was taken out of mutual funds.

But investors were continuing to edge back into emerging market stocks, which saw their eighth week of inflows with $2.7 billion.

This helped push BAML’s “Bull Bear” indicator of market sentiment up from 2.4 to 2.7 – “not yet an extreme bearish reading”, BAML strategists said.

The starting point for a fall to lower equity allocations is high, they pointed out, with the world’s largest sovereign wealth fund at 67 percent equity allocations.

Hedge funds are still at a net 35 to 40 percent net long, and BAML’s fund manager survey shows cash levels under 5 percent.

The global consensus forecast is for 8.3 percent growth in earnings-per-share in 2019, which the strategists said was too high, predicting a “Big Low” in markets next year.

In bond flows investors were pulling out of corporate debt and into government debt, the EPFR data showed.

Some $15 billion flowed into government bond funds over the past eight weeks, while $49 billion flowed out of investment-grade, high-yield, and emerging market debt.

In equity sectors, a building preference for value stocks over growth inverted this week, as tech had its biggest inflows in 11 weeks and financials saw heavy outflows.

Healthcare, tech, energy, and real estate saw inflows while consumer stocks, utilities, and materials saw outflows. Financials were the least preferred with investors pulling $1.3 billion from the sector.

Reporting by Helen Reid; Editing by Alison Williams

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MBA: Commercial, multifamily mortgage delinquencies remain historically low

Delinquency rates on commercial and multifamily mortgages stayed nearly historic lows during the third quarter, the Mortgage Bankers Association reported this week.

“Commercial and multifamily mortgage delinquency rates are extremely low right now,” MBA Vice President for Commercial Real Estate Research Jamie Woodwell said.

According to Woodwell, the delinquency rate for loans held on bank balance sheets hit a new series low, while delinquency rates for loans held by life companies or those guaranteed by Fannie Mae and Freddie Mac are all still below 10 basis points.

Broken down by loan type, based on unpaid principal balance of loans, delinquency rates for each group at the end of the third quarter were:

  • Banks and thrifts (90 or more days delinquent or in non-accrual): 0.48%, a decrease of 0.02 percentage points from the second quarter
  • Life company portfolios (60 or more days delinquent): 0.04%, an increase of 0.01 percentage point from the second quarter
  • Fannie Mae (60 or more days delinquent): 0.07%, a decrease of 0.03 percentage points from the second quarter
  • Freddie Mac (60 or more days delinquent): 0.01%, unchanged from the second quarter
  • Commercial mortgage-backed securities (30 or more days delinquent or in REO): 3.05%, a decrease of 0.47 percentage points from the second quarter

In the report, Woodwell explained that loans held in CMBS have a higher “headline” delinquency rate due to the way the industry reports on those loans.

“But if one pulls out loans in foreclosure or real estate owned–which are generally excluded from the calculations for the other groups–the CMBS delinquency rate is just 45 basis points, the same level as December 2005,” Woodwell said.

The MBA notes in its report that its analysis incorporates the measures used by each individual investor group to track the performance of their loans. And because each investor group tracks delinquencies in its own way, delinquency rates are not comparable from one group to another.

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BlackRock’s Rieder buying longer-term bonds as Fed pause seems likely

NEW YORK (Reuters) – BlackRock Inc’s (BLK.N) Rick Rieder is buying longer-term bonds because softening inflation could force the U.S. Federal Reserve to pause interest rate hikes, the top fixed-income investor told Reuters this week.

Rieder, who is chief investment officer of global fixed income for the world’s largest fund manager, said inflation could be declining from current levels.

“People keep waiting for the bogeyman coming in terms of inflation, and they’re going to have to wait a long time,” Rieder said on Wednesday. “Why not pause?”

BlackRock manages $6.4 trillion in assets, with nearly a third of that in fixed income.

Over the past three weeks, Rieder has been buying longer-term bonds, particularly Treasuries coming due in 5 years, but also those due as far in the future as 30 years.

Earlier this year, Rieder had been selling long bonds, citing uncertainty around Fed policy.

Now, he says, the picture is clearer.

Markets, bracing for an economic slowdown possible by 2020, are pushing back against three years of Fed rate hikes aimed at restoring policy to normal footing a decade after the 2007-2009 global financial crisis.

Strong buying pushed 30-year U.S. yields US30YT=RR to 3.12 percent on Thursday, from highs this month above 3.3. The benchmark SP 500 .SPX stock index is down 2.2 percent over the same period, including dividends.

Fed Chair Jerome Powell said on Nov. 28 policy rates are “just below” estimates of a level that neither brakes nor boosts a healthy U.S. economy.

Markets assign an overwhelming probability that there will be two hikes at most between now and the end of 2019. Rieder in September predicted the Fed would raise rates only twice or so in 2019. At the time markets priced in a better-than-even chance that the Fed would move three times or more.

Investors await a U.S. jobs report on Friday that will shed light on wage inflation.

But inflation is unlikely, Rieder said, as consumers fail to purchase big-ticket items. Housing and other interest rate-sensitive sectors, meanwhile, are reeling from rate hikes.

The Fed is also shrinking its cache of bonds bought after the financial crisis to spur lending and investment.

Partly as a result of that, global market liquidity is set to shrink compared to the prior year for the first time since the crisis, BlackRock estimates show.

Indeed, investors should expect more volatility, Rieder said.

“People are underestimating the amount of liquidity that’s being drained from the system.”

Reporting by Trevor Hunnicutt; Editing by Jennifer Ablan and Bernadette Baum

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Employee rights group says Wells Fargo declined planned meeting

(Reuters) – A union-backed bank employee rights group is complaining after Wells Fargo Co declined to meet with members last week, according to a letter sent to Chief Executive Tim Sloan viewed exclusively by Reuters.

Members of the group, Committee for Better Banks (CBB), were scheduled to meet with Wells Fargo representatives on Wednesday, but the meeting was canceled after the two sides could not agree on terms. The company said CBB members who were not Wells Fargo employees would not be allowed to attend.

Wells Fargo is not unionized. CBB-backed whistleblowers helped reveal the sales practice scandal in 2016 that resulted in hefty fines and penalties for the bank.

Nick Wiener, a CBB organizer, said the group was clear about its intention to bring CBB organizers to the meeting from the outset, and that the group had received a verbal green light from a representative of Wells Fargo management.

Wells Fargo said it only committed to an internal meeting with team members who happened to be a part of CBB.

“We value opportunities to engage and meet with our team members,” said Wells Fargo spokesman Mark Folk. “We were disappointed that the meeting did not occur, and we remain available to meet with the team members in the future.”

CBB said it is critical to have non-Wells Fargo CBB members present so that employees could voice their opinions without fear of retaliation.

“Given Wells Fargo’s track record of firing and blackballing employees who spoke out against the unethical and fraudulent banking practices they were pressured to perform, it’s simply unacceptable that your team is placing restrictions on who should attend a meeting,” said the letter, which was sent on Wednesday and signed by Christopher Shelton, president of Communications Workers of America, which supports CBB.

The bank has taken several steps aimed at rebuilding the trust of employees, customers and investors, including eliminating product sales goals for retail workers, raising wages, and hiring back nearly 2,000 employees who quit or were fired. Sloan has also been hosting town halls to hear employee concerns.

The effort comes as the bank faces investor pressure to cut costs.

Wells Fargo, the largest bank employer in the United States with roughly 265,000 employees as of October, recently announced plans to reduce its workforce by 5 percent to 10 percent.

Reporting by Imani Moise, additional reporting by Ross Kerber; editing by Bill Berkrot

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