Page 15 - Wells Fargo Bank (C) Teaching Note

Whilst banks have amassed more than $160 billion in
fees since 2010 “America's three biggest banks -

JPMorgan Chase, ($2 bn), Bank of America ($1.7 bn) and
Wells Fargo ($1.8 bn) - earned more than $6.4 billion last

year from ATM and overdraft fees, according to an

analysis by CNNMoney that was verified by S&P Global

Market Intelligence” (1) it is noticeable that banks “have

been fined $243 billion since the financial crisis…… Most

of these fines have been assessed for misleading

investors about the underlying quality of the mortgages

they packaged into bonds during the housing bubble.” (2)

However, “It’s important to note that the banks don’t just

send a check for their fines to federal and state

governments. Many times they get credit by making loans

and supporting debt restructuring. For example, a

Goldman Sachs commitment for $1.8 billion of loan

forgiveness and financing for affordable housing was
considered as part of a $5.1 billion “fine” the bank had to

pay.” (2)

Bank fines appear to be coming to the tail end of their

imposition and although misdemeanours will still occur

they are hopefully not going to be on the scale of the post

crisis period.

“The KBW report said it expects the fines to subside, both

because of the time elapsed since the mortgage crisis as

well as the deregulatory bent of the Trump

administration. But the report said the Wells Fargo

sanction, as well as levies against Rabobank and U.S.