May 20 (Reuters) - Wells Fargo & Co plans to return as much as 75 percent of its profits to shareholders, up from 34 percent in 2013, a top executive said on Tuesday.
Chief Financial Officer John Shrewsberry said at the bank's 2014 investor day that Wells Fargo was looking to pay out between 55 percent and 75 percent of net income as dividends and stock repurchases, minus new share issuances. Shrewsberry did not say when the bank expected to meet the new goal for this measure, which it calls net payout ratio.
Shrewsberry said he was confident the bank could meet the updated targets because it already generated a lot of earnings and was operating at its long-term capital requirements.
At its 2012 investor day, the bank targeted a total payout ratio, which did not subtract new share issuance, of 50 percent to 65 percent. Its total payout ratio in 2013 was 55 percent.
Any increase in dividends or share buybacks must be approved annually by the U.S. Federal Reserve and the bank's board of directors. In March, the Fed did not object to Wells Fargo's proposal to increase its quarterly dividend to 35 cents a share from 30 cents and to raise the number of shares it can repurchase.
The bank said it was keeping its targets for a 1.30 percent to 1.60 percent return on assets and a 12 percent to 15 percent return on equity.
Wells Fargo also did not change the target of its efficiency ratio, or revenue relative to costs, from a range of 55 percent to 59 percent.
(Reporting by Peter Rudegeair; Editing by Jeffrey Benkoe)