John Stumpf

The embattled Wells Fargo Chief Executive John Stumpf has resigned from his position, with immediate effect, in the wake of the sham account-opening scandal rocking the bank.

Wells Fargo announced on Wednesday that Stumpf will retire from his roles as the bank’s CEO and chairman. It said the retirement was to become effective immediately.

The announcement comes weeks after it was revealed that employees working in the bank’s community banking division had opened around two million accounts without authorization from customers. The accounts were allegedly created as part of drive by the employees to meet the prohibitive sales targets set by management.

While being grilled by congressional panels on the sham account openings, Stumpf defended Wells Fargo’s sales practices, shifting the blame to junior employees. He was widely criticized for failing to hold himself and other top-level executives responsible for the scam.

“While I have been deeply committed and focused on managing the company through this period, I have decided it is best for the Company that I step aside,” the 63-year-old said in a statement.

Representatives repeatedly asked Stumpf to resign while testifying before the House Financial Services Committee in September. He had insisted, however, that he did not have any plan of resigning, saying he intended seeing the bank through the scandal by executing reforms.

Stumpf, who has been with Wells Fargo for 34 years, became its CEO in 2007. His roles as the chief executive and chairman will now be split following his retirement.

The dual roles played by Stumpf had caused lawmakers to question why the bank hadn’t acted faster to deal with the unauthorized accounts scandal.

Wells Fargo Chief Operating Officer Tim Sloan is set to replace Stumpf as the CEO. He had been the head of the bank’s unit that handles loans to large corporations. There is no report of him being connected to the alleged account scam. He has also been recommended by Stumpf, who said he knew “no better individual to lead this company forward than Tim Sloan.”

The new chief executive has been elected to the board as well.

Stephen Sanger, who has been a Wells Fargo board member since 2003, will become the non-executive chairman of the board. He previously served as a president of Yoplait USA.

A bank spokesman said Stumpf would not be given a severance payment. But he said the former CEO will receive some retirement benefits which are not to become accessible until after a standard lag time of six months.

USA Today reports that Stumpf will receive $134.1 million in retirement benefits, quoting executive-pay tracking firm Equilar. The package would have been larger had he not agreed to relinquish $41 million in unvested stock last month, following questioning by the Senate Banking Committee.

The scandal has come at great cost to investors in Wells Fargo, which was previously the most valuable bank in the U.S. They have lost $23.1 billion in market value in the wake of the scandal, according to USA Today.

The bank has also been made to pay $185 million in penalties for the unauthorized account openings.

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