The Wells Fargo scandal of creating fake accounts became public in 2016, and the company is still suffering the repercussions. Profit is down 53%, and stock performance is lagging.

On an earnings call, Charles Scharf, who has been the CEO since October 2019, explained the bank’s current position:

I was honored to be chosen to lead Wells Fargo because I believe this is an extraordinary company that plays an important role in this country. We came out of the financial crisis as the most valuable and most respected bank in the US, but as you know, we made some terrible mistakes and have not effectively addressed our shortcomings. These circumstances have led to financial underperformance, but we have one of the most enviable financial services franchises in the world and employees that want to do what's necessary to again be one of the most respected and successful banks in the US.

Discussion:

• Read the earnings call transcript. What’s your view of how Scharf and John R. Shrewsberry, EVP and CFO, addressed concerns?

• How well has the bank recovered its image since 2016? What examples of their communications can you cite?

• What could bank executives have done differently in the past four years?

• How well does the line chart work to compare Wells to other leading banks? What could be improved?