it remains to be seen if the presence of Wells Fargo & Co (NYSE:WFC) CEO Tim Sloan was a true liability for WFC and WFC stock or merely a talking point used by the anti-corruption crowd.

But we’re about to find out. On Thursday, Sloan stepped down, initially sending WFC stock up more than 2% on Friday before the shares slipped back into the red on concerns about the potential  disruption of the company.

Sloan’s retirement materialized two and a half (long) years after the revelation that some of the bank’s employees had opened unauthorized checking accounts and credit-card accounts in order to meet sales quotas. In some cases, the unauthorized accounts incurred fees.

The debacle caused trouble for Wells Fargo on several fronts, ranging from problems with regulators to ridicule on social media  to financial difficulties. It also put bearish pressure on Wells Fargo stock.

But Sloan’s resignation may be the very catalyst needed to jump-start a recovery of the oversold WFC stock.

Big Fraud, Big Price

Bank scandals aren’t exactly a new phenomenon. Whenever money is involved and supervision isn’t constant, people will make questionable decisions.

Between 2009 and 2014, U.S. Bancorp (NYSE:USB) failed to flag several suspicious transactions that could have been money laundering. Deutsche Bank (NYSE:DB) was implicated in a scheme to illegally fix the prices of gold and silver.

It happens.

Wells Fargo’s fraud, however, was relatively egregious. All told, 3.5 million accounts were opened on behalf of unsuspecting customers who didn’t want them.

The mega-bank took action. In September of 2016, shortly after the account-opening scandal came to light, more than 5000 of Wells’ employees were fired.

Since then, as deeper investigations of the matter played out, the company dismissed dozens of regional managers for allegedly failing to adequately oversee the activities of the employees under them. That round of firings may have been more for show than impact, but it sent a loud message to regulators and consumers all the same.

Regulators weren’t impressed or convinced, though. Late last year, WFC collectively settled with consumers in all 50 states for $575 million, on top of a $2 billion fine imposed on it last year for mortgage abuses.

Perhaps most difficult for owners of WFC stock to digest, however, was the cap on assets that the Federal Reserve imposed on WFC months ago. That limitation won’t be lifted until the Fed is convinced the bank can adequately police its employees. Capping assets ultimately caps profit growth. That, in turn, will place a ceiling on WFC stock.

Sloan said in January that the Fed’s limitation could last through the end of this year.

And yet, through the kind of storm that would have sent most CEOs packing, Sloan managed to hold onto his job. But he recently reached his breaking point, perhaps because political pressure is cumulative.

Mostly Unpopular

For the record, Sloan wasn’t at the helm when the account-opening scandals took shape. He replaced John Stumpf in Oct. 2016, moving up from his position as COO that he had held since late 2015.

The fact that Sloan was the bank’s second-in-command while the scandal was taking place, however,  made him as much of a target as Stumpf had been.

Senator and now Presidential candidate Elizabeth Warren was a particularly strong critic of WFC, writing in February “Wells Fargo is fundamentally broken, and there is no evidence whatsoever that these problems can be fixed under Mr. Sloan’s watch. The Federal Reserve should take no action to remove the growth cap until Wells Fargo replaces Mr. Sloan as CEO.” Upon hearing that Sloan was resigning, Warren responded “About damn time.”

While Warren may have been the highest-profile, most outspoken critic of Sloan, she wasn’t alone. Representative Andy Barr commented during a recent House Financial Services Committee meeting “I’m shocked that you’re not in an orange suit and little jail cell today.”

Consumers, meanwhile, haven’t forgotten Wells Fargo’s missteps, but have at least started to forgive the company.

Investors, on the other hand, can’t forget or forgive the Fed’s cap on the bank’s asset base. WFC stock is still down about 27% from its early 2018 peak even after the bounce from its late-December low.

The Bottom Line on WFC Stock

While Sloan’s departure was superficially a reason for the owners of WFC stock to celebrate, on the assumption that Sloan’s presence was the key reason the Federal Reserve had put a ceiling on its asset base, the market is clearly more concerned about Sloan leaving than staying, since Wells Fargo stock rolled over relatively soon on the news.

The market is going to have to answer a key question,  though. That is, can one key person be the reason a company succeeds or fails?

Given the depth of Wells’ debacle and the power of guilt-by-association, WFC stock may be perform better if all of its top executives who were around when the company began to unravel leave. New leadership, at the very least, may prompt the Fed and other regulators to rethink the asset cap that has been holding back Wells Fargo stock.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can learn more about James at his site, jamesbrumley.com, or follow him on Twitter, at @jbrumley.