California’s suspension of Wells Fargo & Co. from investment work hasn’t completely prevented the beleaguered bank from underwriting the state’s bonds.
Wells Fargo submitted the lowest competitive bid Wednesday to sell $636 million of California general obligations. The 12-month ban imposed in September by State Treasurer John Chiang applies to negotiated sales, in which the underwriters are picked in advance. State law requires Chiang to accept the lowest bid submitted at an auction.
“We were pleased with the price that they offered,” said Marc Lifsher, a spokesman for Chiang. “It doesn’t reflect our feelings about their behavior toward their customers.”