Wells Fargo Auto originations climb 45% YOY | Auto Finance News | Auto Finance News

Wells Fargo Auto originations climb 45% YOY

Origination volume for Wells Fargo Auto is on a growth trajectory, as the bank reported a 45% year over year increase to $6.9 billion in the third quarter, according to earnings released today. Third quarter originations are up 9% from a two-year high recorded last quarter. 

The jump in origination volume is a reflection of the bank’s renewed focus on originating loans “from the upper credit tiers,” John Shrewsberry, Wells Fargo’s chief financial officer, said during the earnings call, noting that the bank previously included borrowers in the nonprime category.

However, the bank is open to the possibility of dipping into lower credit tiers if consumer credit and used-car values “stay where they are,” Shrewsberry added. 

Wells Fargo Auto deliberately slowed its business in order to restructure it three years ago, Laura Schupbach, head of Wells Fargo Auto, told Auto Finance News. “We tightened our credit policy to strengthen our portfolio, re-engineered processes to better manage risk and made changes to the business, such as increased automation, to make it easier for dealers and consumers to do business with us,” she said. “Our focus now is on winning back market share as we continue to engage with dealers to earn more of their business and keep working to improve customer service.”

Meanwhile, third-quarter auto loan delinquencies dropped 64 basis points to 2.4% of the portfolio. Similarly, net charge-offs fell 45 basis points to 0.65% of the portfolio as a result of the higher quality originations, according to the earnings report. 

Join us for Auto Finance Summit 2019, October 28-30 at the Bellagio Las Vegas. The summit continues to bring together the best and brightest executives in auto lending and leasing for unparalleled networking and education. Register now at www.autofinancesummit.com.

1 - Reader Likes This Post
Latest Magazine Issue
Sign Up Email List
Big Wheels Auto Finance Data Link