Scandal-ridden Wells Fargo shook up its board of directors on Tuesday and tapped Elizabeth Duke to become the first female chairman of a top U.S. bank.
Duke, a former Federal Reserve governor, will replace current Wells Fargo chairman Stephen Sanger on January 1. She will inherit a board that has been rocked by scandals over how Wells Fargo has treated customers and employees.
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Sanger has been chairman for less than a year, during which time he’s struggled to lift the bank out of one of the darkest periods in its 165-year history.
Duke said in a statement that she looks forward to making “Wells Fargo a better company today and in the future.” She also thanked Sanger for his “tireless work” at a time of “significant challenge for Wells Fargo.”
A Wells Fargo board spokesperson confirmed Duke will become the first female chairman of a top American bank. Wells Fargo is the No. 2 U.S. bank by assets behind JPMorgan Chase (JPM), according to the Federal Reserve.
Wells Fargo (WFC)‘s reputation was badly damaged when the bank admitted last September it created some 2 million potentially fake accounts. More recently, Wells Fargo has apologized for charging as many as 570,000 customers for car insurance they didn’t need. It’s also been hit with a lawsuit for allegedly ripping off mom-and-pop shops by overcharging them to process credit card fees.
Wells Fargo could face more legal trouble related to those allegations. Wells Fargo CEO Tim Sloan said that Duke’s “regulatory expertise has been invaluable” and those skills will help the bank in her new role.
“She is a superb choice for a troubled institution in need of steady, principled, and pragmatic leadership,” said Peter Conti-Brown, an assistant professor at The Wharton School of the University of Pennsylvania.
Duke follows in the footsteps of other women who have held top jobs at smaller banks. KeyCorp (KEY), a top 20 U.S. bank, named Beth Mooney its chairman and CEO in 2010. Another woman, Mary Roebling led the Trenton Trust Company until 1972.
CNNMoney (New York) First published August 15, 2017: 5:29 PM ET