<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): April 19, 1994
WELLS FARGO & COMPANY
(Exact name of registrant as specified in its charter)
Delaware 1-6214 No. 13-2553920
(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Identification No.)
420 Montgomery Street, San Francisco, California 94163
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (415) 477-1000
Not applicable
(Former name or former address, if changed since last report)
<PAGE>
-2-
Item 5: OTHER EVENTS
Attached is the Press Release announcing Wells Fargo & Company's financial
results for the quarter ended March 31, 1994. Final financial statements with
additional analyses will be filed as part of the Company's Form 10-Q in May
1994.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, on April 19, 1994.
WELLS FARGO & COMPANY
By: FRANK A. MOESLEIN
----------------------------------
Frank A. Moeslein
Executive Vice President
and Controller
<PAGE>
-3-
FOR IMMEDIATE RELEASE
- --------------------
Tues., Apr. 19, 1994
WELLS FARGO REPORTS FIRST QUARTER EARNINGS OF $202 MILLION;
PER SHARE EARNINGS $3.41 VS. $1.72 A YEAR AGO
Wells Fargo & Co. (NYSE:WFC) today reported net income of $202 million
for the first quarter of 1994, compared with $108 million for the first quarter
of 1993, an increase of 87 percent. Per share earnings for the first quarter of
1994 were $3.41, compared with $1.72 in the first quarter of 1993. First
quarter 1994 results were higher than a year ago, primarily due to a lower loan
loss provision.
Return on average assets (ROA) was 1.60 percent and return on average
common equity (ROE) was 21.09 percent in the first quarter of 1994. In the
year-ago period, ROA was .86 percent and ROE was 12.10 percent.
Net interest income on a taxable-equivalent basis was $642 million in the
first quarter of 1994, a decline of 5 percent from $679 million a year ago.
This decline resulted from both a lower average loan balance and a lower net
interest margin.
The company's net interest margin for the first quarter of 1994 was
5.56 percent, down from 5.90 percent in the same quarter of 1993. The decrease
was primarily due to lower yields on earning assets. However, loan balances
rose by 1 percent, to $33.452 billion, between December 31, 1993 and March 31,
1994. This is the first quarterly increase in loan balances since 1990.
"We are encouraged by the new business activity and strong profitability
we've seen during the past three months," said Carl E. Reichardt, chairman.
"The California economy seems to be stabilizing and we have seen increased loan
demand in the first quarter."
Noninterest income in the first quarter of 1994 was $300 million,
compared with $259 million in the same quarter of 1993, an increase of 16
percent. A significant portion of this increase was due to a $17 million growth
in service charges on deposit accounts.
Noninterest expense in the first quarter of 1994 was $523 million, down
3 percent from $539 million in the same quarter of 1993. The decrease
primarily resulted from a decline in foreclosed assets expense.
-more-
<PAGE>
Wells Earnings -4-
The provision for loan losses in the first quarter of 1994 was $60
million, compared with $210 million in the first quarter of 1993. Continued
improvement in the company's loan portfolio resulted in the reduction of the
provision.
Net charge-offs in the first quarter of 1994 totaled $61 million, or
.74 percent of average total loans (annualized). The largest category of net
charge-offs was credit card loans ($35 million). For the first quarter of 1993,
net charge-offs totaled $155 million, or 1.75 percent of average total loans
(annualized). The largest categories of net charge-offs were real estate
mortgage loans other than 1-4 family ($58 million), credit card loans ($42
million) and real estate construction loans ($24 million).
At March 31, 1994, the allowance for loan losses equaled 6.34 percent of
total loans, compared with 6.41 percent at December 31, 1993 and 6.04 percent
at March 31, 1993.
At March 31, 1994, total nonaccrual and restructured loans decreased to
$900 million (2.7 percent of total loans), of which an estimated 41 percent were
current as to payment of principal and interest. This compares with $1.200
billion (3.6 percent of total loans) at December 31, 1993, of which an estimated
50 percent were current, and $1.974 billion (5.6 percent of total loans) at
March 31, 1993, of which an estimated 52 percent were current. The estimated
average cash yield on the average nonaccrual loans outstanding in the first
quarter of 1994 was 8.5 percent, 9.0 percent last quarter and 6.9 percent in the
first quarter of 1993. Foreclosed assets were $354 million at March 31, 1994,
compared with $348 million at December 31, 1993 and $510 million at March 31,
1993.
At March 31, 1994, the company's preliminary risk-based capital ratios
were 14.85 percent for total risk-based capital and 10.25 percent for Tier 1
risk-based capital, exceeding the minimum regulatory guidelines of 8 percent and
4 percent, respectively. At December 31, 1993, these risk-based capital ratios
were 15.12 percent and 10.48 percent, respectively. The decrease in total and
Tier 1 risk-based capital ratios between December 31, 1993 and March 31, 1994
resulted primarily from the redemption of $150 million in Series A preferred
stock (at its liquidation preference carrying amount) on March 21, 1994 and
secondarily from the repurchase of 555,853 shares of common stock during the
quarter. At March 31, 1993, the company's total risk-based capital ratio was
13.67 percent and the Tier 1 risk-based capital ratio was 8.78 percent. The
ratio of common equity to total assets at March 31, 1994 was 7.09 percent,
compared with 7.00 percent at December 31, 1993 and 6.37 percent at March 31,
1993.
###
<PAGE>
Wells Earnings -5-
Wells Earnings
Wells Fargo & Company and Subsidiaries
SUMMARY FINANCIAL DATA -- NEWS RELEASE
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
% Change
Quarter ended March 31, 1994 from
---------------------------------- -------------------
MARCH 31, Dec. 31, March 31, Dec. 31, March 31,
(in millions) 1994 1993 1993 1993 1993
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
FOR THE QUARTER
Net income $ 202 $ 190 $ 108 6 % 87 %
Per common share
Net income $ 3.41 $ 3.18 $ 1.72 7 98
Dividends declared 1.00 .75 .50 33 100
Average common shares outstanding 56 56 55 -- 2
Profitability ratios (annualized)
Net income to average total assets (ROA) 1.60% 1.46% .86% 10 86
Net income applicable to common stock to
average common stockholders' equity (ROE) 21.09 19.85 12.10 6 74
Average loans $ 32,848 $ 33,149 $ 35,836 (1) (8)
Average assets 51,220 51,597 50,961 (1) 1
Average core deposits 40,385 40,691 40,386 (1) --
Net interest margin 5.56% 5.69% 5.90% (2) (6)
AT QUARTER END
Investment securities $ 13,766 $ 13,058 $ 10,685 5 29
Loans 33,452 33,099 35,152 1 (5)
Allowance for loan losses 2,121 2,122 2,122 -- --
Assets 52,176 52,513 51,155 (1) 2
Core deposits 41,145 41,291 40,628 -- 1
Common stockholders' equity 3,700 3,676 3,257 1 14
Stockholders' equity 4,189 4,315 3,896 (3) 8
Capital ratios
Common stockholders' equity to assets 7.09% 7.00% 6.37% 1 11
Stockholders' equity to assets 8.03 8.22 7.62 (2) 5
Risk-based capital(1)
Tier 1 capital 10.25 10.48 8.78 (2) 17
Total capital 14.85 15.12 13.67 (2) 9
Leverage(1) 7.35 7.39 6.65 (1) 11
Book value per common share $ 66.87 $ 65.87 $ 58.72 2 14
COMMON STOCK PRICE
High $147-1/2 $133 $109-1/2 11 35
Low 127-5/8 105-7/8 75-1/2 21 69
Quarter end 139-3/8 129-3/8 108-5/8 8 28
- --------------------------------------------------------------------------------------------------------------
<FN>
(1) The March 31, 1994 ratios are preliminary.
</TABLE>
<PAGE>
Wells Earnings -6-
Wells Fargo & Company and Subsidiaries
CONSOLIDATED STATEMENT OF INCOME
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------
Quarter
ended March 31,
--------------- %
(in millions) 1994 1993 Change
- ----------------------------------------------------------------------------------
<S> <C> <C> <C>
INTEREST INCOME
(1) Loans $705 $814 (13)%
(2) Investment securities 185 152 22
Federal funds sold and securities purchased
(3) under resale agreements 4 4 --
(4) Other 1 -- --
---- ----
(5) Total interest income 895 970 (8)
---- ----
INTEREST EXPENSE
(6) Deposits 196 232 (16)
Federal funds purchased and securities sold
(7) under repurchase agreements 8 7 14
(8) Commercial paper and other short-term borrowings 1 2 (50)
(9) Senior and subordinated debt 48 51 (6)
---- ----
(10) Total interest expense 253 292 (13)
---- ----
(11) NET INTEREST INCOME 642 678 (5)
(12) Provision for loan losses 60 210 (71)
---- ----
Net interest income after
(13) provision for loan losses 582 468 24
---- ----
NONINTEREST INCOME
(14) Service charges on deposit accounts 117 100 17
(15) Fees and commissions 85 88 (3)
(16) Trust and investment services income 50 46 9
(17) Investment securities gains 4 -- --
(18) Other 44 25 76
---- ----
(19) Total noninterest income 300 259 16
---- ----
NONINTEREST EXPENSE
(20) Salaries 189 183 3
(21) Employee benefits 57 55 4
(22) Net occupancy 55 53 4
(23) Equipment 39 34 15
(24) Federal deposit insurance 26 32 (19)
(25) Other 157 182 (14)
---- ----
(26) Total noninterest expense 523 539 (3)
---- ----
INCOME BEFORE INCOME TAX
(27) EXPENSE 359 188 91
(28) Income tax expense 157 80 96
---- ----
(29) NET INCOME $ 202 $ 108 87 %
==== ==== ===
NET INCOME APPLICABLE TO
(30) COMMON STOCK $ 190 $ 95 100 %
==== ==== ===
PER COMMON SHARE
(31) Net income $3.41 $1.72 98 %
==== ==== ===
(32) Dividends declared $1.00 $ .50 100 %
==== ==== ===
(33) Average common shares outstanding 56 55 2 %
==== ==== ===
- ----------------------------------------------------------------------------------
</TABLE>
<PAGE>
Wells Earnings -7-
Wells Fargo & Company and Subsidiaries
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
% Change
Mar. 31, 1994 from
------------------
MAR. 31, Dec. 31, Mar. 31, Dec. 31, Mar. 31,
(in millions) 1994 1993 1993 1993 1993
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ASSETS
(1) Cash and due from banks $ 2,702 $ 2,644 $ 2,488 2 % 9 %
Investment securities:
(2) At cost (estimated fair value $10,606, $9,978
and $10,906) 10,710 9,887 10,685 8 --
(3) At fair value 3,056 3,171 -- (4) --
------- ------- -------
(4) Total investment securities 13,766 13,058 10,685 5 29
Federal funds sold and securities
(5) purchased under resale agreements 126 1,668 499 (92) (75)
(6) Loans 33,452 33,099 35,152 1 (5)
(7) Allowance for loan losses 2,121 2,122 2,122 -- --
------- ------- -------
(8) Net loans 31,331 30,977 33,030 1 (5)
------- ------- -------
(9) Due from customers on acceptances 66 70 74 (6) (11)
(10) Accrued interest receivable 314 297 337 6 (7)
(11) Premises and equipment, net 888 898 924 (1) (4)
(12) Goodwill 468 477 513 (2) (9)
(13) Other assets 2,515 2,424 2,605 4 (3)
------- ------- -------
(14) Total assets $52,176 $52,513 $51,155 (1)% 2 %
======= ======= ======= === ===
LIABILITIES
(15) Noninterest-bearing deposits $ 9,611 $ 9,719 $ 8,568 (1)% 12 %
(16) Interest-bearing deposits 31,993 31,925 32,406 -- (1)
------- ------- -------
(17) Total deposits 41,604 41,644 40,974 -- 2
Federal funds purchased and securities
(18) sold under repurchase agreements 1,532 1,079 952 42 61
(19) Commercial paper and other short-term borrowings 156 188 171 (17) (9)
(20) Acceptances outstanding 66 70 74 (6) (11)
(21) Accrued interest payable 98 63 120 56 (18)
(22) Other liabilities 1,011 933 862 8 17
(23) Senior debt 2,074 2,256 2,224 (8) (7)
(24) Subordinated debt 1,446 1,965 1,882 (26) (23)
------- ------- -------
(25) Total liabilities 47,987 48,198 47,259 -- 2
------- ------- -------
STOCKHOLDERS' EQUITY
(26) Preferred stock 489 639 639 (23) (23)
Common stock - $5 par value,
authorized 150,000,000 shares;
issued and outstanding 55,337,248 shares,
(27) 55,812,592 shares and 55,475,281 shares 277 279 277 (1) --
(28) Additional paid-in capital 485 551 525 (12) (8)
(29) Retained earnings 2,963 2,829 2,459 5 20
(30) Cumulative foreign currency translation adjustments (4) (4) (4) -- --
(31) Investment securities valuation allowance (21) 21 -- -- --
------- ------- -------
(32) Total stockholders' equity 4,189 4,315 3,896 (3) 8
------- ------- -------
(33) Total liabilities and stockholders' equity $52,176 $52,513 $51,155 (1)% 2 %
======= ======= ======= === ===
</TABLE>
<PAGE>
Wells Earnings -8-
Wells Fargo & Company and Subsidiaries
CONDENSED CONSOLIDATED STATEMENT OF
CHANGES IN STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------
Quarter ended March 31,
----------------------
(in millions) 1994 1993
- -------------------------------------------------------------------------------------------
<S> <C> <C>
BALANCE, BEGINNING OF QUARTER $4,315 $3,809
Net income 202 108
Common stock issued under employee benefit and
dividend reinvestment plans 8 20
Preferred stock redeemed (150) --
Common stock repurchased (76) --
Preferred stock dividends (12) (13)
Common stock dividends (56) (28)
Change in investment securities valuation allowance (42) --
------ ------
BALANCE, END OF QUARTER $4,189 $3,896
====== ======
- -------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
LOANS
- -------------------------------------------------------------------------------------------
MARCH 31, December 31, March 31,
(in millions) 1994 1993 1993
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Commercial (1) $ 6,934 $ 6,912 $ 7,505
Real estate 1-4 family first mortgage 8,180 7,458 6,567
Other real estate mortgage 8,160 8,286 9,925
Real estate construction 923 1,110 1,367
Consumer:
Real estate 1-4 family junior lien mortgage 3,412 3,583 4,053
Credit card 2,556 2,600 2,640
Other revolving credit and monthly payment 1,988 1,920 1,914
------- ------- -------
Total consumer 7,956 8,103 8,607
Lease financing 1,253 1,212 1,180
Foreign 46 18 1
------- ------- -------
Total loans $33,452 $33,099 $35,152
======= ======= =======
- -------------------------------------------------------------------------------------------
<FN>
(1) Includes loans to real estate developers of $491 million, $505 million and $657 million
at March 31, 1994, December 31, 1993 and March 31, 1993, respectively.
</TABLE>
<PAGE>
Wells Earnings -9-
Wells Fargo & Company and Subsidiaries
CHANGES IN THE ALLOWANCE FOR LOAN LOSSES
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------
Quarter ended
---------------------------------------
MARCH 31, December 31, March 31,
(in millions) 1994 1993 1993
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C>
BALANCE, BEGINNING OF QUARTER $2,122 $2,123 $2,067
Provision for loan losses 60 80 210
Loan charge-offs:
Commercial (1) (25) (29) (29)
Real estate 1-4 family first mortgage (5) (8) (5)
Other real estate mortgage (13) (21) (66)
Real estate construction (4) (13) (24)
Consumer:
Real estate 1-4 family junior lien mortgage (8) (9) (8)
Credit card (40) (40) (47)
Other revolving credit and monthly payment (8) (9) (13)
------ ------ ------
Total consumer (56) (58) (68)
Lease financing (4) (5) (5)
------ ------ ------
Total loan charge-offs (107) (134) (197)
====== ====== ======
Loan recoveries:
Commercial (2) 8 22 22
Real estate 1-4 family first mortgage 3 -- --
Other real estate mortgage 10 16 8
Real estate construction 5 3 --
Consumer:
Real estate 1-4 family junior lien mortgage 1 1 1
Credit card 5 6 5
Other revolving credit and monthly payment 3 3 3
------ ------ ------
Total consumer 9 10 9
Lease financing 11 2 3
------ ------ ------
Total loan recoveries 46 53 42
------ ------ ------
Total net loan charge-offs (61) (81) (155)
------ ------ ------
BALANCE, END OF QUARTER $2,121 $2,122 $2,122
====== ====== ======
Total net loan charge-offs as a percentage
of average total loans (annualized) .74% .97% 1.75%
====== ====== ======
Allowance as a percentage of total loans 6.34% 6.41% 6.04%
====== ====== ======
- -------------------------------------------------------------------------------------------
<FN>
(1) Includes charge-offs of loans to real estate developers of $10 million, $15 million and
$4 million in the quarters ended March 31, 1994, December 31, 1993 and March 31, 1993,
respectively.
(2) Includes recoveries from loans to real estate developers of none, $1 million and
$1 million in the quarters ended March 31, 1994, December 31, 1993 and March 31, 1993,
respectively.
</TABLE>
<PAGE>
Wells Earnings -10-
Wells Fargo & Company and Subsidiaries
NONACCRUAL AND RESTRUCTURED LOANS AND OTHER ASSETS
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------
MARCH 31, December 31, March 31,
(in millions) 1994 1993 1993
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Nonaccrual loans:
Commercial (1) $ 165 $ 252 $ 558
Real estate 1-4 family first mortgage 90 99 97
Other real estate mortgage 413 578 1,071
Real estate construction 202 235 204
Consumer:
Real estate 1-4 family junior lien mortgage 22 27 30
Other revolving credit and monthly payment 3 3 6
------ ------ ------
Total nonaccrual loans 895 1,194 1,966
Restructured loans 5 6 8
------ ------ ------
Nonaccrual and restructured loans 900 1,200 1,974
As a percentage of total loans 2.7% 3.6% 5.6%
Foreclosed assets (2) 354 348 510
Real estate investments (3) 11 15 26
------ ------ ------
Total nonaccrual and restructured loans
and other assets $1,265 $1,563 $2,510
====== ====== ======
<FN>
- -------------------------------------------------------------------------------------------
(1) Includes loans to real estate developers of $47 million, $91 million and $64 million
at March 31, 1994, December 31, 1993 and March 31, 1993, respectively.
(2) Excludes in-substance foreclosures of $99 million reclassified to nonaccrual loans at
June 30, 1993 due to clarification of criteria used in determining when a loan is
in-substance foreclosed. Complete information is not available for prior periods;
however, any ISFs that would be reclassified in prior periods would not be materially
higher than $99 million.
(3) Represents the amount of real estate investments (contingent interest loans accounted
for as investments) that would be classified as nonaccrual if such assets were loans.
Real estate investments totaled $29 million, $34 million and $56 million at March 31,
1994, December 31, 1993 and March 31, 1993, respectively.
</TABLE>
<TABLE>
<CAPTION>
QUARTERLY TREND OF CHANGES IN NONACCRUAL LOANS (1)
- -------------------------------------------------------------------------------------------
MARCH 31, Dec. 31, Sept. 30, June 30, March 31,
(in millions) 1994 1993 1993 1993 1993
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BALANCE, BEGINNING OF QUARTER $1,194 $1,696 $1,898 $1,966 $2,134
New loans placed on nonaccrual 52 113 195 264 249
Charge-offs (35) (55) (90) (71) (109)
Payments (121) (309) (188) (144) (156)
Transfers to foreclosed assets (37) (64) (32) (104) (41)
Transfers from foreclosed assets (2) -- -- -- 99 --
Loans returned to accrual (157) (188) (81) (107) (82)
Loans sold (3) -- (2) (5) (26)
Other additions (deductions) 2 1 (4) -- (3)
------ ------ ------ ------ ------
BALANCE, END OF QUARTER $ 895 $1,194 $1,696 $1,898 $1,966
====== ====== ====== ====== ======
- -------------------------------------------------------------------------------------------
<FN>
(1) The March 31, 1994 amounts are preliminary.
(2) Reclassification due to clarification of criteria used in determining when a loan is
in-substance foreclosed.
</TABLE>
<PAGE>
Wells Earnings -11-
Wells Fargo & Company and Subsidiaries
NONACCRUAL LOANS BY PERFORMANCE CATEGORY (1)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------
Cash interest
Cumulative payments applied as:
cash ----------------------
Book interest Contractual Reduction
principal Cumulative applied to principal Interest of
(in millions) balance charge-offs(6) principal(6) balance income(7) principal(7)
- ----------------------------------------------------------------------------------------------------------
MARCH 31, 1994 FIRST QUARTER 1994
--------------------------------------------------- ----------------------
<S> <C> <C> <C> <C> <C> <C>
Contractually past due (2):
Payments not made (3):
90 days or more past due $ 136 $ 4 $ -- $ 140 $-- $--
Less than 90 days past due 4 6 -- 10 -- --
------ ---- ----- ------ --- ---
140 10 -- 150 -- --
------ ---- ----- ------ --- ---
Payments made (4):
90 days or more past due 270 127 38 435 -- 4
Less than 90 days past due 122 61 36 219 1 1
------ ---- ----- ------ --- ---
392 188 74 654 1 5
------ ---- ----- ------ --- ---
Total past due 532 198 74 804 1 5
Contractually current (5) 363 102 55 520 2 7
------ ---- ----- ------ --- ---
Total nonaccrual loans $ 895 $300 $129 $1,324 $ 3 $12
====== ==== ===== ====== === ===
<CAPTION>
- ----------------------------------------------------------------------------------------------------------
December 31, 1993 Fourth quarter 1993
--------------------------------------------------- ----------------------
<S> <C> <C> <C> <C> <C> <C>
Contractually past due (2):
Payments not made (3):
90 days or more past due $ 161 $ 22 $ -- $ 183 $-- $--
Less than 90 days past due 23 -- -- 23 -- --
------ ---- ----- ------ --- ---
184 22 -- 206 -- --
------ ---- ----- ------ --- ---
Payments made (4):
90 days or more past due 329 171 41 541 -- 6
Less than 90 days past due 86 29 16 131 -- 2
------ ---- ----- ------ --- ---
415 200 57 672 -- 8
------ ---- ----- ------ --- ---
Total past due 599 222 57 878 -- 8
Contractually current (5) 595 214 120 929 1 14
------ ---- ----- ------ --- ---
Total nonaccrual loans $1,194 $436 $177 $1,807 $ 1 $22
====== ==== ===== ====== === ===
- ----------------------------------------------------------------------------------------------------------
<FN>
(1) There can be no assurance that individual borrowers will continue to perform at the level indicated or
that the performance characteristics will not change significantly. The March 31, 1994 amounts are
preliminary.
(2) Contractually past due is defined as a borrower whose loan principal or interest payment is 30 days or
more past due.
(3) Borrower has made no payments since being placed on nonaccrual.
(4) Borrower has made some payments since being placed on nonaccrual. Approximately $283 million and
$314 million of these loans had some payments made on them during the first quarter of 1994 and the
fourth quarter of 1993, respectively.
(5) Contractually current is defined as a loan for which principal and interest are being paid in
accordance with the terms of the loan. Approximately $52 million and $113 million of loans, both
current and past due, were placed on nonaccrual in the first quarter of 1994 and the fourth quarter of
1993, respectively, of which approximately $2 million and $15 million were contractually current at
March 31, 1994 and December 31, 1993, respectively. All of the contractually current loans were
placed on nonaccrual due to uncertainty of receiving full timely collection of interest or principal.
(6) Cumulative amounts recorded since inception of the loan.
(7) Includes only those interest payments received subsequent to a borrower being placed on nonaccrual.
Therefore, these amounts do not include interest received before these loans were placed on nonaccrual.
There were no interest payments received that were recorded as recoveries on partially charged-off
loans because payments on such loans were applied as a reduction of loan principal or recognized as
interest income.
</TABLE>
<PAGE>
Wells Earnings -12-
Wells Fargo & Company and Subsidiaries
NONINTEREST INCOME
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
Quarter ended
March 31,
--------------- %
(in millions) 1994 1993 Change
--------------------------------------------------------------------------------
<S> <C> <C> <C>
Service charges on deposit accounts $117 $100 17 %
Fees and commissions:
Credit card membership and other credit card fees 16 17 (6)
Debit and credit card merchant fees 12 19 (37)
Charges and fees on loans 10 11 (9)
Mutual fund and annuity sales fees 9 11 (18)
Shared ATM network fees 9 9 --
All other 29 21 38
---- ----
Total fees and commissions 85 88 (3)
Trust and investment services income:
Asset management and custody fees 31 31 --
Mutual fund management fees 11 8 38
All other 8 7 14
---- ----
Total trust and investment services income 50 46 9
Investment securities gains 4 -- --
Income from equity investments accounted for by the:
Equity method 9 8 13
Cost method 8 14 (43)
Check printing charges 10 9 11
Gains from dispositions of operations 10 -- --
Real estate investment gains (losses) 2 (7) --
Gains on sales of loans 1 3 (67)
All other 4 (2) --
---- ----
Total $300 $259 16 %
==== ==== ==
--------------------------------------------------------------------------------
</TABLE>
NONINTEREST EXPENSE
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
Quarter ended
March 31,
--------------- %
(in millions) 1994 1993 Change
--------------------------------------------------------------------------------
<S> <C> <C> <C>
Salaries $189 $183 3 %
Employee benefits 57 55 4
Net occupancy 55 53 4
Equipment 39 34 15
Federal deposit insurance 26 32 (19)
Contract services 19 12 58
Certain identifiable intangibles 16 23 (30)
Advertising and promotion 15 15 --
Operating losses 14 16 (13)
Telecommunications 11 11 --
Postage 11 11 --
Outside professional services 9 10 (10)
Goodwill 9 10 (10)
Check printing 8 9 (11)
Stationery and supplies 7 7 --
Travel and entertainment 7 6 17
Foreclosed assets 6 26 (77)
Escrow and collection agency fees 5 7 (29)
Security 5 5 --
Outside data processing 3 4 (25)
All other 12 10 20
---- ----
Total $523 $539 (3)%
==== ==== ==
--------------------------------------------------------------------------------
</TABLE>
<PAGE>
Wells Earnings -13-
Wells Fargo & Company and Subsidiaries
AVERAGE BALANCES, YIELDS AND RATES PAID (TAXABLE-EQUIVALENT BASIS) (1)
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------
Quarter ended
-------------------------------------------------------
MARCH 31, 1994 March 31, 1993
------------------------- -------------------------
Interest Interest
Average Yields/ income/ Average Yields/ income/
(in millions) balance rates expense balance rates expense
------------------------------------------------------------------------------------------------------------------
EARNING ASSETS
Investment securities:
At cost:
<S> <C> <C> <C> <C> <C> <C>
(1) U.S. Treasury securities $ 2,575 4.88% $31 $ 2,155 5.24% $ 28
Securities of U.S. government agencies
(2) and corporations 6,163 6.13 95 7,448 6.55 122
(3) Obligations of states and political subdivisions 18 -- -- 24 -- --
(4) Private collateralized mortgage obligations 950 5.24 12 -- -- --
(5) Other securities 117 5.46 2 147 5.38 2
------- --- ------- ---
(6) Total investment securities at cost 9,823 5.71 140 9,774 6.25 152
At fair value (2):
Securities of U.S. government agencies
(7) and corporations 1,681 6.02 25 -- -- --
(8) Private collateralized mortgage obligations 1,289 5.45 18 -- -- --
(9) Other securities 83 14.09 2 -- -- --
------- --- ------- ---
(10) Total investment securities at fair value 3,053 5.90 45 -- -- --
------- --- ------- ---
(11) Total investment securities 12,876 5.76 185 9,774 6.25 152
Federal funds sold and securities purchased
(12) under resale agreements 576 3.16 4 537 3.29 4
Loans:
(13) Commercial 6,629 8.91 146 7,693 9.69 184
(14) Real estate 1-4 family first mortgage 7,766 6.94 135 6,681 8.52 142
(15) Other real estate mortgage 8,157 8.37 168 10,042 7.87 196
(16) Real estate construction 1,059 8.32 22 1,492 9.00 33
Consumer:
(17) Real estate 1-4 family junior lien mortgage 3,494 7.27 63 4,103 7.52 77
(18) Credit card 2,540 15.34 97 2,702 15.79 107
(19) Other revolving credit and monthly payment 1,939 9.28 45 1,944 9.60 46
------- --- ------- ---
(20) Total consumer 7,973 10.33 205 8,749 10.53 230
(21) Lease financing 1,230 9.36 29 1,178 10.10 30
(22) Foreign 34 -- -- 1 -- --
------- --- ------- ---
(23) Total loans 32,848 8.65 705 35,836 9.15 815
(24) Other 52 6.00 1 -- -- --
------- --- ------- ---
(25) Total earning assets $46,352 7.77 895 $46,147 8.47 971
======= --- ======= ---
FUNDING SOURCES
Interest-bearing liabilities:
Deposits:
(26) Interest-bearing checking $ 4,712 .98 11 $ 4,624 1.44 16
(27) Savings deposits 2,565 1.99 13 2,913 2.41 17
(28) Market rate savings 17,157 2.22 94 16,035 2.42 97
(29) Savings certificates 7,042 4.14 72 8,716 4.43 95
(30) Certificates of deposit 208 7.76 4 238 8.20 5
(31) Other time deposits 104 6.56 2 122 6.67 2
(32) Deposits in foreign offices 56 -- -- 7 -- --
------- --- ------- ---
(33) Total interest-bearing deposits 31,844 2.50 196 32,655 2.88 232
Federal funds purchased and securities sold
(34) under repurchase agreements 1,077 3.05 8 1,083 2.80 7
(35) Commercial paper and other short-term borrowings 150 3.00 1 222 2.95 2
(36) Senior debt 2,202 4.52 25 2,193 5.03 27
(37) Subordinated debt 1,678 5.59 23 1,878 5.16 24
------- --- ------- ---
(38) Total interest-bearing liabilities 36,951 2.78 253 38,031 3.11 292
(39) Portion of noninterest-bearing funding sources 9,401 -- -- 8,116 -- --
------- --- ------- ---
(40) Total funding sources $46,352 2.21 253 $46,147 2.57 292
======= --- ======= ---
Net interest margin and net interest income on
(41) a taxable-equivalent basis (3) 5.56% $642 5.90% $679
===== ==== ===== ====
NONINTEREST-EARNING ASSETS
(42) Cash and due from banks $ 2,557 $ 2,416
(43) Other 2,311 2,398
------- -------
Total noninterest-earning assets $ 4,868 $ 4,814
======= =======
NONINTEREST-BEARING FUNDING SOURCES
(44) Deposits $ 8,909 $ 8,098
(45) Other liabilities 1,086 1,008
(46) Preferred stockholders' equity 620 639
(47) Common stockholders' equity 3,654 3,185
Noninterest-bearing funding sources used to
(48) fund earning assets (9,401) (8,116)
------- -------
(49) Net noninterest-bearing funding sources $ 4,868 $ 4,814
======= =======
(50) TOTAL ASSETS $51,220 $50,961
======= =======
<FN>
------------------------------------------------------------------------------------------------------------------
(1) The average prime rate of Wells Fargo Bank was 6.02% and 6.00% for the quarters ended March 31, 1994
and 1993, respectively. The average three-month London Interbank Offered Rate (LIBOR) was 3.57% and
3.26% for the same quarters, respectively.
(2) Yields are based on amortized cost balances.
(3) Includes taxable-equivalent adjustments that primarily relate to income on certain loans and
securities that is exempt from federal and applicable state income taxes. The federal statutory tax
rate was 35% and 34% for the quarters ended March 31, 1994 and 1993, respectively.
</TABLE>
