Wells Fargo (WFC 0.17%) is reportedly mulling a sale of its private-label credit card business as the bank continues to look for ways to slim down and refocus its business, according to Bloomberg, which cited anonymous sources.
The rumors align with other recent reports that say the bank is also considering a sale of its asset management division, which has $607 billion assets under management, as well as its corporate trust division and student loan portfolio, which could be worth roughly $10 billion.
CEO Charlie Scharf said on the bank's third-quarter earnings call said that he is looking "to exit some things which aren't core to the U.S. banking franchise." Scharf has also indicated that the bank is interested in cutting annual expenses by around $10 billion to get its cost structure in line with its peers.
Image source: Wells Fargo
The private-label credit card business partners with retailers, so people can purchase items on credit when they check out.
According to Bloomberg, CFO John Shrewsberry, who is about to retire, said in 2014 that the bank would look to strengthen its private-label business. But since then, the bank has failed to pick up market share in the growing segment.
Wolfe Research analyst Bill Carcache put out a report that cited potential buyers of the business, including Synchrony Financial (SYF 0.33%), a leader in the private-label card market. Other potential buyers Carcache listed include Alliance Data Systems (BFH 2.03%), Capital One Financial (COF 0.36%), Citigroup (C 1.30%), and Goldman Sachs (GS 1.75%) .
