NEW YORK (TheStreet) -- Wells Fargo & Co. (WFC - Get Report) shares are down 3.13% to $46.94 on Wednesday after the U.S. home lender said today that it would pay $1.2 billion to settle civil claims related to its Federal Housing Administration (FHA) lending program.
This includes loans made under the program between 2001 and 2010.
In 2012, the Justice Department prosecuted the company, saying it failed to report more than 6,000 loans that did not meet necessities for insurance under the FHA and failed to properly review early payment defaults, Reuters reports.
Wells Fargo is one of five banks that agreed to the $25 billion nationwide settlement with the Justice Department over mortgage-related claims. Other lenders such as Bank of America Corp. (BAC), Citigroup (C) and Deutsche Bank AG (DB) have already settled federal lawsuits.
As a result of this settlement, Wells Fargo lowered its 2015 net income by $134 million or 3 cents a share.
Separately, the company is in talks with Credit Suisse (CS) to buy parts of the Swiss lender's investment banking and capital markets business, Reuters added.
Separately, TheStreet Ratings currently has a "Buy" rating on the stock with a letter grade of B.
The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share and expanding profit margins. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: WFC