Wells Fargo’s ‘living will’ is approved after ‘deficiencies’ are fixed

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Wells Fargo directors on Monday got a boost ahead of what could be a stormy meeting with shareholders, as regulators waved through the US bank’s “living will” four months after they hit it with sanctions for failing to comply.

Financial watchdogs said Wells had “remediated the deficiencies” in its plan for how it would avoid a bailout and wind down if it were hit by a crisis.

Wells in December became the first bank in the country to fail the test, in a blow to its leadership as they reeled from the scandal over fake bank accounts.

Regulators barred it from setting up overseas entities and buying non-bank companies until they were satisfied with the resolution plan.

The bank will no longer be subjected to the restrictions after the Federal Reserve and Federal Deposit Insurance Corporation gave the green light to its latest attempt at a “living will”.

The regulatory thumbs-up is some much-needed good news for the bank’s directors as they prepare for a difficult annual meeting on the the Florida coast on Tuesday. Leading shareholder groups have recommended investors vote against the re-election of board members in the wake of the accounts crisis, in which thousands of staff created accounts and credit cards for customers who knew nothing about them.

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