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Wells Fargo & Company is an American international banking and financial services holding company headquartered in San Francisco, California, with hub quarters” throughout the country. It is the world’s second-largest bank by market capitalization and the third largest bank in the U.S. by assets. Wells Fargo became the world’s largest bank by market capitalization, edging past ICBC, before slipping behind JPMorgan Chase in 2016, in the wake of a scandal involving the creation of over 2 million fake bank accounts by Wells Fargo employees. Wells Fargo surpassed Citigroup Inc. to become the third-largest U.S. bank by assets at the end of 2015. Wells Fargo is the second-largest bank in deposits, home mortgage servicing, and debit cards.
The firm’s primary U.S. operating subsidiary is national bank Wells Fargo Bank, which designates its main office as Sioux Falls, South Dakota. Wells Fargo in its present form is a result of a merger between San Francis co–based Wells Fargo & Company and Minneapolis-based Norwest Corporation in 1998 and the subsequent 2008 acquisition of Charlotte-based Wachovia. Following the mergers, the company transferred its headquarters to Wells Fargo’s headquarters in San Francisco and merged its operating subsidiary with Wells Fargo’s operating subsidiary in Sioux Falls. Along with JPMorgan Chase, Bank of America, and Citigroup, Wells Fargo is one of the Big Four Banks of the United States. 8,700 retail branches and 13,000 automated teller machines. The company operates across 35 countries and has over 70 million customers globally.
In February 2014, Wells Fargo was named the world’s most valuable bank brand for the second consecutive year in The Banker and Brand Finance study of the top 500 banking brands. In 2016, Wells Fargo ranked 7th on the Forbes Magazine Global 2000 list of largest public companies in the world and ranked 27th on the Fortune 500 list of the largest companies in the United States. The company was ranked the 22nd most admired company in the world, and the 7th most respected company in the world. As of October, the company had a credit rating of AA, However, for a brief period, the company was the only AAA-rated bank, reflecting the highest credit rating from two firms. On February 2, 2018, the U.S. Federal Reserve Bank barred Wells Fargo from growing its asset base any further, based upon years of misconduct, until Wells Fargo fixes its internal problems to the satisfaction of the Federal Reserve. Wells Fargo delineates three different business segments when reporting results.
Wells Fargo is an excellent bank for those looking for both local branch access and digital banking services. The bank’s interest rates on most of its accounts leave a lot to be desired compared to the best online banks, but they are comparable to other national banks. With branches in many communities. Its services include home loans, mortgage refinancing and home equity loans. Explore mortgage information, affordability calculators and home loan shopping tools on its website. If you’re interested, apply online or talk to a Wells Fargo mortgage consultant in your area.
Important Factors to consider
a. Highly accessible in numerous locations – With approximately 4,900 branches and over 12,000 ATMs across 37 states and the District of Columbia, Wells Fargo is one of the more easily accessible large banks in the United States.
b. Frequently waived monthly fees – While Wells Fargo does levy maintenance fees on many of its deposit accounts, the bank does provide a number of methods for avoiding them. Most clients can easily qualify for one of the many waivers.
c. Innovative, secure data-sharing, and money management apps – Wells Fargo partnered with Intuit to provide a seamless and completely secure connection for customers who use Mint, QuickBooks online and TurboTax online. This pioneering move allows Wells Fargo customers to easily share data with these Intuit products so they can handle their financial chores without risking their accounts’ security.
d. Low interest rates – Account APYs tend to skew lower at traditional brick-and-mortar banks than at their online counterparts. Still, Wells Fargo offers very lackluster rates on all of its savings options. In addition, every savings account also carries a monthly fee, meaning your account may essentially earn a negative amount if you are unable to avoid the charge, if your account dips below the minimum daily balance, for example.
e. Overdraft fees levied up to three times daily – Wells Fargo charges a 35 dollars overdraft fee for its Debit Card Overdraft Service every time you overdraw your account. Unfortunately, the bank’s policies allow up to three overdrafts per day, meaning you could be staring down 105 dollars in overdraft fees from a single day’s mistakes. On the other hand, if you’ve signed up for Overdraft Protection, you will be charged one fee per business day, but the fee amount will depend on type of account from which the funds are withdrawn to cover the overdraft.
Who Is Wells Fargo Best For?
Wells Fargo will appeal to customers who want a well-established traditional bank with a large geographic footprint. It will be a great fit for those who –
1. Need a bank that is present in the majority of the United States, including the District of Columbia
2. Can easily keep a minimum balance in their checking and savings account to avoid fees
3. Want to use Mint, QuickBooks online, or TurboTax online to handle their accounting and financial affairs
Community banking
The Community Banking segment includes Regional Banking, Diversified Products, and Consumer Deposits groups, as well as Wells Fargo Customer Connection, formerly Wells Fargo Phone Bank, Wachovia Direct Access, the National Business Banking Center, and Credit Card Customer Service. Wells Fargo also has around 2,000 stand-alone mortgage branches throughout the country. There are mini-branches located inside of other buildings, which are almost exclusively grocery stores, that usually contain ATMs, basic teller services, and, space permitting, an office for private meetings with customers. Wells Fargo announced a plan to offer smartphone-based transactions with mobile wallets including Wells Fargo Wallet, Android Pay and Samsung Pay.
Consumer lending
Wells Fargo Home Mortgage was the largest retail mortgage lender in the United States, originating one out of every four home loans. Wells Fargo services 1.8 trillion dollars in home mortgages, the second largest servicing portfolio in the U.S. It was reported in 2012 Wells Fargo reached 30 percent market share for US mortgages, however, the then-CEO John Stumpf had said the numbers were misleading because about half of that share represented the aggregation of smaller loans that were then sold on in the secondary market. Its share was closer to 22 percent; of which eight percentage points was aggregation.
Wells Fargo private student loans
Wells Fargo private student loans are available to students to pay for college expenses, such as tuition, books, computers, or housing. Loans are available for undergraduate, career and community colleges, graduate school, law school and medical school. Wells Fargo also provides private student loan consolidation and student loans for parents.
Wholesale banking
Its wholesale banking segment contains products sold to large- and middle-market commercial companies, as well as to consumers on a wholesale basis. This includes lending, treasury management, mutual funds, asset-based lending, commercial real estate, corporate and institutional trust services, and capital markets and investment banking services through Wells Fargo Securities. One area that is very profitable to Wells Fargo, however, is asset-based lending: lending to large companies using accounts receivable and inventory as collateral, though less traditional assets are often included in the collateral package.
Historically, this type of lending has been done when normal routes of raising funds, such as the Capital Markets or unsecured bank loans, have been exhausted. The main business unit associated with this activity is Wells Fargo Capital Finance. Wells Fargo also owns Eastdil Secured, which is described as a real estate investment bank, but is essentially one of the largest commercial real estate brokers for very large transactions such as the purchase and sale of large Class-A office buildings in central business districts throughout the United States.
Equipment lending
Wells Fargo has various divisions that finance and lease equipment to different types of companies. One venture is Wells Fargo Rail, which completed the purchase of GE Capital Rail Services and merged in with First Union Rail. Wells Fargo Equipment Finance is the country’s largest equipment financer and nearly doubled in size after it purchased GE Capital’s equipment finance division effective March.
