Wells Fargo Soars 3.7% as Fed Lifts Asset Cap

Wells Fargo's stock surged 3.7% in pre-market trading on June 4, 2025, driven by the Federal Reserve's decision to lift a seven-year asset cap imposed on the bank.

The Federal Reserve's move to remove the asset cap on Wells Fargo marks a significant milestone for the bank, which has been under regulatory scrutiny since 2018. The cap, imposed in response to a series of scandals including the creation of millions of fake accounts, had limited the bank's asset growth to $1.95 trillion. The removal of this cap allows Wells Fargo to pursue unrestricted growth, a development that has been eagerly anticipated by investors and analysts.

Wells Fargo's CEO, Charlie Scharf, hailed the decision as a key milestone in the bank's transformation journey. He expressed gratitude for the support of the bank's employees and reiterated the bank's commitment to continuing its efforts to improve governance and risk management. The bank has also announced a $2,000 bonus for all full-time employees, primarily in the form of restricted stock, to celebrate this achievement.

The lifting of the asset cap is expected to have a positive impact on Wells Fargo's stock price, as it removes a significant regulatory hurdle and opens up new opportunities for growth. The bank's ability to expand its asset base will be closely watched by investors, who are hopeful that this move will translate into improved financial performance in the coming quarters.