(Reuters) - Wells Fargo & Co WFC.N expects to gain better control of costs in relation to revenues, as it works to recover from a sales scandal, its chief executive said on Tuesday.

The sign outside the Wells Fargo & Co. bank in downtown Denver April 13, 2016. REUTERS/Rick Wilking

Tim Sloan, CEO of the third-largest U.S. bank, said at an industry conference hosted by Barclays that expenses will likely account for 60 percent to 61 percent of revenues in the second half of 2017, down slightly from the previous three quarters.

However, Sloan said the expense estimate does not include nonrecurring costs, including litigation costs that exceed the amount the bank has already set aside.

Wells Fargo does not disclose how much it sets aside for litigation, but said in its second-quarter financial filing that such costs could exceed that amount by as much as $3.3 billion. That number was $2 billion in the bank’s first-quarter filing.

Sloan, who has called Wells Fargo’s efficiency ratio unacceptable, said he expects the bank to return to its long-term target efficiency ratio of 55 percent to 59 percent some time next year.

Wells Fargo shares rose 1.2 percent to $51.27 on Tuesday.

The bank’s full-year net interest income will likely increase by the low- to mid-single digits from 2016, the CEO said.

Third-quarter lending will be slowed by reduced activity in autos, the runoff of its junior lien mortgage portfolio, and what Sloan called a “slower and more competitive” environment for commercial real estate lending.

He said the declines would be partially offset by increased nonconforming residential first mortgage lending.

Wells Fargo’s business has been under pressure for the past year after the bank initially disclosed it had opened as many as 2.1 million accounts without customer authorization over several years. The ensuing scandal led to a company-wide review that turned up problems with other products, including auto and life insurance.

Last month, Wells Fargo said the unauthorized accounts totaled as many as 3.5 million.

Sloan’s predecessor John Stumpf resigned last year and other senior executives and board members have resigned or been fired.

On Tuesday, Sloan faced questions over whether new issues would emerge.

“I can’t promise its exactly over,” he said. He noted management changes, internal reviews and other steps the bank has taken since the scandal emerged.

“We’ve been very focused on opening every door and turning over every rock in the company,” he said.