Rumors of Wells Fargo-Goldman merger underscore just how bad things have gotten for

But don’t hold your breath for a tie-up between Goldman Sachs and Wells Fargo, two lightning rods in the industry.

Such a deal would create an uproar in Washington, especially among critics of big banks such as Sen. Elizabeth Warren. Regulators would be unlikely to even bless a merger given Wells Fargo’s troubled past and sanctions against the bank for its fake-accounts scandal.

“I can’t see [Rep.] Maxine Waters or Elizabeth Warren backing that,” said Kyle Sanders, analyst at Edwards Jones. “They are advocating for breaking up the banks, not letting the banks get bigger and more powerful.”

Yet shares of Wells Fargo (WFC)surged 7% on Thursday after FOX Business reported the San Francisco banking giant could be a merger target of Goldman Sachs. Other Goldman Sachs partners reportedly include PNC (PNC) and US Bancorp (USB). CNN Business has not verified that report.

Wells Fargo is still in trouble

It’s not even clear that joining forces would make sense right now, for either company.

Teaming up with Wells Fargo would only increase Goldman’s exposure to the risk of negative interest rates, which have doomed banks in Europe. And because these two companies have so little overlap on the retail banking front, there may be little room for the kind of cost-savings that often motivate these deals.

“Why would you want to double down in this space?” asked Nicholas Colas, co-founder of DataTrek Research. “It’s not like you can close a bunch of Goldman branches and save money. There aren’t any.”

Regulatory obstacles are clearly very high for a Wells Fargo-Goldman Sachs deal.

First, Wells Fargo already owns more than 10% of all bank deposits in the United States. That legally prevents the bank from acquiring another deposit-taking institution, unless the rules were changed or the banks sold enough deposits to satisfy regulators.

Second, Wells Fargo is still stuck in the penalty box with regulators.

In 2018, the Fed imposed an asset cap on Wells Fargo that prevents the bank from growing above $2 trillion in assets. Last month, the Fed eased these growth restrictions, but only to allow Wells Fargo to aggressively lend to small businesses. Acquiring Goldman Sachs would add another $1.1 trillion to Wells Fargo’s balance sheet.

Bank stocks are getting crushed as economy tanks

Still, the fact this is even being talked about underscores how bad sentiment is toward big banks right now, and these lenders in particular.

Wells Fargo’s stock has plummeted 56% this year, including a 19% loss this month alone. Wells Fargo closed at $22.53 on Tuesday, its weakest finish since June 2009, long before the 2016 fake-accounts scandal.

Goldman Sachs (GS) has lost a quarter of its value so far this year and trades at just 80% of its book value. The Wall Street bank’s once-vaunted capital markets business has struggled for years, and its Marcus retail division is hurting from…