Wells Fargo Presentation to Texas A

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Wells Fargo Presentation to Texas AM
University

• April 14, 2004

Developing RELATIONSHIPS. Providing SOLUTIONS
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Todays Agenda

• Introduction to Wells Fargo, Commercial Banking
• Comments regarding banking and the financial
  services industry
• Case study overview Oil States International
• Q A

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First a quiz.

• Wells Fargos ticker symbol is?
• WFC
• Wells Fargos market cap. is? (within 4B)
• 96 B /- (as of 2/25/04)
• Amount of loans to Enron?
• 0
• Amount lost in Enron debacle?
• 0

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First a quiz.

• Two banks have larger market caps than WFC, who
  are they?
• Hint pick two JPMorgan Chase, Citigroup,
  Wachovia, Washington Mutual, Fifth Third Bank,
  Bank ONE, BofA, Comerica, U.S. Bank, Bank of NY,
  FleetBoston.
• Citi - 247B,
• BofA (w/ Fleet) - 113B (155B)

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Our Rich History

• Established in 1852 by Henry Wells and William
  Fargo
• Financed the first cross-country stagecoach line
  in 1858
• Merged with Norwest Bank in 1998
• Voted most admired bank by Fortune magazine

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Wells Fargos 23 state territory
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The Wells Fargo Vision

• We want to satisfy all the financial needs of our
  customers, help them succeed financially, be
  recognized as the premier financial service
  company in our markets and be one of Americas
  great companies.

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Market Recognition

• Most Admired U.S. commercial bank Fortune
• Best Commercial Internet Bank Global Finance
• Among Top 100 places to work for working mothers
  Working Mother Magazine
• Second most admired bank globally - Fortune
• Best Bank for valuing customers time - Forbes
• Best bank in the U.S. - SmartMoney

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Wells Fargo Key Facts (9/30/03)

• Assets ... 390 billion
• Team Members ... 139,000
• Customer Households .. 24 million
• Stores . 5,600
• ATMs .. 6,257
• Market Capitalization . 93.4 billion
• Only Aaa rated bank in U.S. (first since 95)

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Meeting All Wells Fargos Customers Needs
SmallBusinesses(0-10MMSales)
HighNet WorthConsumers
Consumers
LargeBusinesses(500MMSales)
Middle MarketBusinesses(10-500MMSales)
BusinessBanking
PrivateClientServices
RetailBanking
U.S.CorporateBanking
CommercialBanking
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Commercial Banking Key Statistics

• Approximately 1,900 full-time employees.
• More than 12,000 customer relationships.
• Approx. 60 physical office locations throughout
  the U.S.
• RCBOs (Regional Commercial Banking Offices) and
  LPOs (Loan Production Offices).
• High level of service through relationship
  banking approach.
• Fast, local decision making on credit requests.
• An impressive array of treasury management
  solutions tailored to the needs of each business.
  
• 24-hour customer service through Cash Management
  Client Services (CMCS) 1-800-AT-WELLS.
• Rated most admired Commercial Bank in the world
  by Fortune magazine.
• Commercial Electronic Office (CEO)
  Internet-based portal for Commercial clients to
  access all services

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Primary Delivery ChannelRegional Commercial
Banking Office
Key RVP Regional Vice President LTM Loan Team
Manager CSM Customer Service Manager RM
Relationship Manager RA Relationship
Associate BDO Business Development Officer TMSC
Treasury Management Sales Consultant
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Typical Customer ProfileWho is our Target
Market?

• Annual sales of 10 million to 250 million
• Average Asset Quality Rating (AQR)
• Relatively low leverage
• Established long, profitable track record
• Well-managed

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What we Sell our Customer Base

• Treasury management solutions technologically-adv
  anced products tailored to the unique needs of
  each business
• Payments examples include Controlled
  Disbursement, ACH, Purchasing Card, WellsTax,
  Wire Transfer
• Collections examples include Interstate
  Deposits, Cash Vault, Lockbox
• Reconciliation examples include Account
  Reconciliation (ARP), Positive Pay
• Information examples include PC Manager, other
  Windows and Internet-based information reporting

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What We Sell to our Customer Base

• Credit commercial loans tailored to the unique
  needs of each business
• Working Capital
• Real Estate Financing
• Equipment Leasing
• Equipment Financing
• Trade Finance
• Expansion and Acquisition
• International Banking

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How do we Measure Relationship Profitability?

• What we measure.
• PTPP Pre-Tax Pre-Provision
• NIACC Net Income After Capital Charge
• How we measure it
• ProfitMax
• Internal Wells Fargo system
• Outlines PTPP and NIACC of each relationship
• Automatic feeds from source systems
• Easily accessible by line staff
• Does not include all Bank products sold-- i.e.
  non-Wholesale Banking products cross-sold. yet.

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Partnering with Multiple Lines of Business Key
to Our Success

• Key partners include..
• Wholesale Banking
• U.S. Corporate
• Capital Markets
• Equipment Finance and Asset based Lending
• International
• Foreign Exchange
• Investments
• Institutional Trust
• Wells Capital Management
• Private Client Services
• Other Units as Appropriate
• Retail, Business Banking, etc.

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Comments on the Banking Industry

• Views differ greatly depending upon vantage point
• Traditional "banking business model" in decline
• Cross-sold, multi-product relationships a must -
  "switching costs"
• Risk-based capital allocation methods have vastly
  improved investment discipline
• "Convergence" - blurring of traditionally
  separated roles, Citi/Travelers, Deutsche Bank/BT
  Alex. Brown, Chase/Morgan, Palm/cell phones?
• Is this what clients want or are we presuming to
  know what is best for them before asking?

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Impact of Cross-Selling
Average Pre-Tax Profit Per Customer (000)
Number of Products Per Customer
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Cross-Sell SuccessForeign Exchange
Revenue MM
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Changing Revenue Stream
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Case Study Oil States International, Inc.

• Combination of three different companies
• Company pursuing an IPO
• Wells Fargo Bank looking to participate in a
  150MM bank revolver led by CSFB

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Q A
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