Wells Fargo CEO addresses company’s CRA rating

CEO Tim Sloan shares his perspective on Wells Fargo’s most recent Community Reinvestment Act rating.

Editor’s note: In response to Wells Fargo’s Community Reinvestment Act rating downgrade, CEO Tim Sloan sent the following message to all team members on March 28, 2017. Read more about Wells Fargo's commitment to communities in this special report: Investing in Our Communities.


Supporting communities is a big part of Wells Fargo’s culture and has been for decades. That is why I want to address a development we announced today — one that, while disappointing, should cast no doubt on our commitment to leadership in corporate citizenship.

Today we announced the results of our most recent Community Reinvestment Act (CRA) evaluation from the Office of the Comptroller of the Currency (OCC). Though the evaluation acknowledged Wells Fargo’s “Outstanding” performance in lending to, investing in, and providing service to low- and moderate-income communities, the OCC nevertheless downgraded us to a rating of “Needs to Improve” because of previously issued regulatory consent orders such as September’s orders regarding sales practices in retail banking.

A little background: In accordance with the federal Community Reinvestment Act of 1977, every three to four years the OCC is required to review banks to determine how well they meet the credit needs of communities where they do business, including low- and moderate-income communities. Today’s rating is based on an evaluation period that began in 2009 and ended more than four years ago, in 2012. A copy of the OCC’s entire review is available online.

The “Needs to Improve” rating is extremely disappointing because so many people at Wells Fargo have done such great work over the years to address the needs of low- and moderate-income communities. In fact, many community partners recognize Wells Fargo as a leader in this area, given the fact that since 1994 — the first year CRA evaluation results became public — we have never been rated anything less than “Outstanding.”

Even in its most recent review, called a “Performance Evaluation,” the OCC cited Wells Fargo’s lending levels as reflecting “excellent responsiveness to credit needs in the majority” of low- and moderate-income areas. It also characterized us as a leader in providing community development services such as financial education for individuals and families. And, thanks to great work around the country, Wells Fargo’s efforts were rated a minimum of “Satisfactory” across all 54 states and multi-state metropolitan areas reviewed by the OCC for the timeframe concluding in 2012.

Beyond my disappointment, here’s what I want you to know: Wells Fargo will continue to be a leader in lending, investing, and providing service to low- and moderate-income communities across the U.S. — going beyond CRA requirements. We will, because that commitment is consistent with our goal of being the industry’s leader in corporate citizenship and speaks to our belief that we can only be as successful as the communities we serve. We also intend to ask the OCC to accelerate the timing of our next evaluation, scheduled for 2018 completion, so that we may continue to most effectively serve the low- and moderate-income communities in which we operate.

Meanwhile, there’s much in our 2009–2012 evaluation period that we can be proud of:

  • $12.4 billion in community development loans and investments that increased economic development, created jobs, and built tens of thousands of affordable housing units.
  • Mortgage modification, refinancing, and other consumer relief efforts that helped more than 900,000 individuals and families keep their homes.
  • More than $18 million in grants to nonprofits in 72 cities through our Priority Markets initiative, which supports stabilizing neighborhoods facing challenges.

In addition, since the end of the last evaluation period, we have:

  • Provided nearly $30 billion in lending and investments to support economic development, job creation, and affordable housing.
  • Invested more than $330 million in our LIFT programs, helping more than 13,000 families and individuals across 50 communities achieve homeownership with the help of down payment assistance grants.
  • Launched the Diverse Community Capital program, a three-year, $75 million initiative that supports nonprofits that assist diverse-owned small businesses.

Indeed, over the past six years, Wells Fargo has originated more home loans to African Americans, Asian Americans, Hispanics, Native Americans, low- and moderate-income borrowers, and residents of low- and moderate-income neighborhoods than any bank in the U.S.

As I’ve said before, we will have some days that will feel very difficult on our collective journey to rebuild trust, and I admit this feels like one of them. However, because I know the people of Wells Fargo so well, I also know we will pull together and continue to work hard every day to serve our customers. Earning an “Outstanding” rating on our CRA evaluation has always been important to us, and we will continue to strive for that rating in the future. Our efforts, then and now, are rooted in our commitment to supporting communities.

Thank you for your support and commitment to Wells Fargo.

outbrain