The banking sector is receiving a boost on Tuesday, lifting financial ETFs, amid news that Wells Fargo & Co said that Mike Santomassimo will replace John Shrewsberry as Chief Financial Officer when he retires this year after over 20 years with the bank.
Since becoming chief executive in October, Charles Scharf has adjusted the leadership staff at the bank and instituted a group of former colleagues and confidants in key positions. Santomassimo most recently served as Scharf’s CFO at Bank of New York Mellon and in the past headed the finance teams for various business lines at JPMorgan Chase & Co.
Shrewsberry, who told Scharf he was considering retirement when he joined the company, will continue for a period to ensure an easy transition, the company said. Shrewsberry was named CFO in 2014 after running Wells Fargo Securities and Wells Fargo’s commercial capital division.
“Mike is a strategic-minded CFO with success in building and leading global finance teams that help drive business improvement,” Scharf said. “His experience as the CFO of one of the other seven Globally Systemic Important Banks in the U.S. puts him in a unique position to have an immediate impact on Wells Fargo. He is action-oriented and will be an important partner to me and our entire Operating Committee as we move our company forward.”
“On behalf of the entire Board and management team, I thank John for his many years of dedication and valuable contributions,” said Scharf. “When I joined the company last October, John had indicated that he was considering retirement, but he wanted to ensure he was as helpful as he could be in my transition and believes that now is an appropriate time since we have the Operating Committee largely in place. He will be missed. Throughout his tenure, John has served as an excellent financial and strategic leader for our company. During his time as CFO, he has played a significant role in executing numerous financial and operational initiatives while maintaining the company’s strong capital and liquidity positions. He is well-respected throughout the company and the financial community for his strategic insight as well as for his commitment and passion for building strong, personal relationships, and we are grateful for his many years of service to the company.”
The transition at Wells Fargo arrives as the bank prepares to launch a broad cost-cutting initiative this year and continues to deal with costly regulatory and operational problems related to a long-running sales scandal.
“Throughout his tenure, John has served as an excellent financial and strategic leader for our company,” Scharf said. “He is well-respected throughout the company and the financial community.”
Shrewsberry said, “The past 22 years have been rewarding thanks to the talented people I have worked with and the work we have led. It has been my privilege to be surrounded by a dedicated team and some of the brightest minds in financial services. I am proud of the progress we have made and the team we have built, and I have every confidence in the Enterprise Finance team to continue the good work we’ve begun. I have gotten to know Mike over the last couple of years and recommended him for the job. He is an experienced, well-respected CFO and I am excited about what he will bring to Wells Fargo.”
Wells Fargo is up more than 6% on Tuesday amid the news, while JP Morgan and Citigroup are also benefitting from the move. The broad Financial Select Sector SPDR (NYSEArca: XLF) has advanced over 2% thanks to the gains in bank stocks, while the iShares Dow Jones US Reg Banks Ind. ETF (IAT) gained nearly 5%.
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