Principal Financial Close To Acquiring Wells Fargo Retirement Unit: Report

Principal Financial is deep in talks to acquire the Wells Fargo retirement plan business in a deal estimated at about $1 billion, Reuters reports.

Wells Fargo is dealing with fallout from a wide range of scandals, and is reportedly looking to downsize. In addition, the bank is prohibited from growing after the Federal Reserve imposed an asset cap in February 2018.

The retirement unit includes Wells Fargo's 401(k) servicing, which would be folded into a similar business at Principal, Reuters reported. The deal could be announced later this month, the news service added.

The stock price of both Wells Fargo and Principal is up today, an indication that Wall Street views the potential deal favorably.

InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.