UPDATE 1-Wells Fargo's head of wealth and investment management to retire

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June 1 (Reuters) - Wells Fargo & Co said David Carroll, head of wealth and investment management, will retire after 38 years with the company.

Carroll, 60, will be replaced by Jonathan Weiss, 59, the current head of Wells Fargo Securities.

Though Carroll's retirement is effective July 1, he will remain with the company until July 31 to ensure a smooth transition, the bank said in a statement on Thursday.

Wells Fargo spokeswoman Kathleen Leary gave reason for Carroll's retirement other than that he was "ready for new challenges".

Wells Fargo said it expects to announce Weiss' replacement before he transitions into his new role.

Weiss will remain based in New York and report to Chief Executive Timothy Sloan. He will also join the company's operating committee, Wells Fargo said.

In the first quarter, Wells Fargo's wealth and investment management unit earned $623 million, up nearly 22 percent from a year earlier.

Carroll's retirement announcement comes two days after the lender made executive changes in its retail banking business, which was hit by a sales scandal last year.

The sales abuses in the branch banking operation led to a $190 million regulatory settlement, other government probes, the firing of several bankers, the departure of CEO John Stumpf and shareholders offering scant support for most directors at the bank's annual meeting last month.

The company has also been trying to cut costs to assuage investor concerns about soaring expenses in the aftermath of the scandal.

The San Francisco-based bank's stock, which had fallen 7.2 percent this year up to Wednesday's close, was little changed in early trading. (Reporting by Nikhil Subba in Bengaluru; Editing by Sweta Singh and Saumyadeb Chakrabarty)