- The news that Wells Fargo (WFC -0.6%) has found 1.4M more possibly unauthorized accounts (bringing the tally to as many as 3.5M) isn't as bad as it might seem, says Sandler O'Neill & Partners.
- That's because of the much wider scope of the new examination, analyst Scott Siefers tells CNBC.
- "It's important to keep this in context. Yes the number of affected accounts was up by 65 percent or so, but it is important to bear in mind they basically doubled the amount of time in their review," he explains, calling for closure to this part of the scandal.
- But: "Wells Fargo investors have to wrestle with what's been a slowing top line revenue growth trend ... There's still a litany of uncertainties out there. In that vein I think that the [valuation] discount is warranted still."
- Keefe, Bruyette & Woods agrees that the review wrap-up is a positive: "The retail sales practice scandal settlement was announced nearly a year ago, and at this stage we now expect the trickle of new information to slow considerably.
- "That said, the company still has to resolve issues related to its auto lending business, collateral protection insurance (CPI) and guaranteed auto protection waivers (GAP insurance), and we expect those items to remain an overhang on shares of WFC in the near-term."
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