New York, January 22, 2026, 18:54 EST — After-hours
- Wells Fargo shares ended the day 2.2% higher at $88.04, holding steady in after-hours trading.
- The bank revealed a proposed settlement notice in a shareholder derivative lawsuit and set a court hearing for May 5.
- Next week’s Fed meeting is in traders’ sights, with rate signals poised to move bank shares.
Wells Fargo & Co shares climbed 2.2% to $88.04 during Thursday’s regular session and remained steady after hours, following late-day filings that brought new legal and funding issues into focus for investors.
The rally ended a seven-day slide for Wells Fargo, coinciding with a stronger session for U.S. stocks—S&P 500 gained 0.55%, Dow climbed 0.63%. Volume in Wells Fargo shares exceeded its recent average, though the stock remains roughly 10% below its 52-week peak hit earlier this month. (MarketWatch)
Wells Fargo disclosed in an SEC filing that it is issuing a court-approved notice related to a proposed settlement of shareholder derivative litigation. The case, filed by shareholders on the company’s behalf, centers on alleged issues with mortgage lending and hiring practices. According to the notice, shareholders won’t receive a direct payout. A final approval hearing is set for May 5 in San Francisco. The settlement includes $100 million in mortgage assistance aimed at low- and moderate-income borrowers, plus a separate $10 million payment to the company from an insurer representing the director defendants. (SEC)
The bank has also submitted a preliminary pricing supplement for fixed-rate callable notes offering a 5.30% coupon, maturing on Feb. 5, 2041. Wells Fargo can redeem this debt early, with annual call options beginning in 2029, pending regulatory approval. Pricing is expected to be set on Feb. 3, with the issue date slated for Feb. 5.
The latest filings come after a volatile period for Wells Fargo shares following last week’s quarterly update. The bank highlighted severance costs tied to job cuts, while investor attention zeroed in on net interest income — the margin between loan earnings and deposit costs. CEO Charlie Scharf told analysts, “The economy and our customers remain resilient.” Meanwhile, CFO Mike Santomassimo, when asked about a proposed 10% cap on credit card interest rates, said: “We would just encourage continued careful consideration of all proposals.” (Reuters)
For equity holders, the settlement notice feels less like a capital event and more like a governance and reputation concern. Still, it arrives at a time when bank valuations are under pressure from shifting rate expectations and jittery consumer credit outlooks.
The downside scenario is straightforward. Court approval isn’t guaranteed, and objections could delay or alter settlements. On the market front, a rise in yields or worsening credit conditions would hit bank shares fast. Plus, long-term funding strategies could change sharply if rates jump again.
Next on the radar is macro. Traders are focused on the Federal Reserve’s meeting on January 27–28, looking for clues about the rate trajectory. This will heavily influence bank earnings forecasts and shape the sector’s next move. (Federalreserve)
