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Wells Fargo Falls as It Ends Personal Credit Lines

Wells Fargo, reviewing its product offerings, is ending personal and portfolio lines of credit.
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Wells Fargo said it would stop offering personal lines of credit and shutter those current accounts.

The bank will no longer offer the product, which enabled users to borrow between $3,000 and $100,000 and was pitched as tool to consolidate higher-interest credit-card debt, pay for home renovations and avoid overdraft fees on linked accounts. 

"Wells Fargo recently reviewed its product offerings and decided to discontinue offering new Personal and Portfolio line of credit accounts and close all existing accounts,” the bank said in a six-page letter that was reviewed by CNBC. 

Wells Fargo shares at last check were 1.3% lower at $42.86. 

Customers have received 60 days notice that their accounts will be shuttered, and remaining balances will require regular minimum payments, CNBC reported.

The move is part of Chief Executive Charles Scharf's reimagining of the San Francisco company. The bank had offloaded assets and deposits while removing some products due to restrictions imposed by the Federal Reserve

The Federal Reserve accepted the bank's overhaul plan in February after the central bank found that Wells Fargo had defrauded customers through techniques such as establishing unauthorized accounts. 

In February 2018, the Fed prohibited Wells Fargo from lifting its assets beyond their year-end 2017 level until it implemented certain reforms. 

Last year, Wells Fargo said it would pay $3 billion to settle investigations by the Securities and Exchange Commission and the Justice Department into the fake-accounts scandal.

In April, the bank topped analyst earnings expectations for its latest quarter. Wells Fargo, the fourth-largest U.S. lender, reported earnings of $4.74 billion, or $1.05 a share, compared with $653 million, or 1 cent a share, in the year-earlier period.

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