Wells Fargo & Co. is imposing a cap on its subprime auto portfolio, specifically limiting the dollar amount of originations to less than 10% of its overall volume, according to a report published this morning.
This is the first time that Wells Fargo, which has claimed the top spot in auto finance on more than one occasion, has imposed limitations to its subprime auto, according to executives cited in the report.
Wells Fargo President and Chief Executive John Stumpf perhaps hinted at coming changes to the bank’s auto lending practices back in December 2014. “I don’t have a chart where it says Wells Fargo must be No. 1 in this business,” Stumpf said at the Goldman Sachs U.S. Financial Services Conference. “What we must do is do a good job and make sure that we have proper risk and return.”
The bank’s auto originations were down in the fourth quarter, to $6.7 billion, compared to $7.6 billion in 3Q14, and the lowest level reported since the bank originated $5.4 billion of loans in the final quarter of 2012.
Auto Finance News has reached out to Wells Fargo for comment.
