Bloomberg News

Wells Fargo Will Benefit From Interest-Rate Increase, Sloan Says

June 05, 2013

Wells Fargo & Co. (WFC:US), the biggest U.S. home lender, is well-positioned for rising interest rates because the firm will benefit from higher returns, said Chief Financial Officer Timothy Sloan.

“The current backup in rates we think is attractive and will allow us to invest,” Sloan, 53, said today at a New York investor conference in response to a question about rising Treasury note yields. One drawback is that “it makes some consumers who were thinking about refinancing their mortgage probably think twice.”

Managing through a rise in interest rates is the biggest challenge facing bankers today, Sloan’s boss, Chief Executive Officer John Stumpf, said last week. While the San Francisco-based firm erred by prematurely keeping money on the sidelines in anticipation of rising rates, the shift may finally be coming, he said.

Analysts and investors have expressed concern that banks will be stuck with loans and other assets that will lose value because they were created when rates were near record lows.

“We’re very well-poised for an increase in interest rates,” Sloan said. “If rates go up, we can operate successfully.”

To contact the reporter on this story: Hugh Son in New York at hson1@bloomberg.net

To contact the editor responsible for this story: David Scheer at dscheer@bloomberg.net


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Companies Mentioned

  • WFC
    (Wells Fargo & Co)
    • $51.33 USD
    • -0.02
    • -0.04%
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