NORWEST CORP, 10-Q, 1997-08-13

NORWEST CORP
10-Q, 1997-08-13
NATIONAL COMMERCIAL BANKS

Previous: NORTHERN STATES POWER CO /MN/, 10-Q, 1997-08-13

Next: NORTHERN TRUST CORP, 10-Q, 1997-08-13

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1997

( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 1-2979

NORWEST CORPORATION

A Delaware Corporation-I.R.S. No. 41-0449260
Norwest Center
Sixth and Marquette
Minneapolis, Minnesota 55479
Telephone (612) 667-1234

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that
the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. X Yes ___ No.

Common Stock, par value $1 2/3 per share,
outstanding at July 31, 1997 374,801,341 shares

<PAGE>

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

The following consolidated financial statements of Norwest Corporation
and its subsidiaries are included herein:

Page
1. Consolidated Balance Sheets -
June 30, 1997 and December 31, 1996.......................... 3

2. Consolidated Statements of Income -
Quarters and Six Months Ended June 30, 1997 and 1996......... 4

3. Consolidated Statements of Cash Flows -
Six Months Ended June 30, 1997 and 1996...................... 5

4. Consolidated Statements of Stockholders' Equity -
Six Months Ended June 30, 1997 and 1996...................... 6

5. Notes to Unaudited Consolidated Financial Statements........... 8

The financial information for the interim periods is unaudited. In the
opinion of management, all adjustments necessary (which are of a normal
recurring nature) have been included for a fair presentation of the
results of operations. The results of operations for an interim period
are not necessarily indicative of the results that may be expected for a
full year or any other interim period.

<PAGE>

Norwest Corporation and Subsidiaries
CONSOLIDATED BALANCE SHEETS
(Unaudited)

In millions, except shares June 30, December 31,
1997 1996
ASSETS
Cash and due from banks ...................... $ 4,037.8 4,856.6
Interest-bearing deposits with banks ......... 26.3 1,237.9
Federal funds sold and resale agreements ..... 452.6 1,276.8
Total cash and cash equivalents .......... 4,516.7 7,371.3
Trading account securities ................... 1,503.4 186.5
Investment and mortgage-backed securities
available for sale ......................... 19,627.2 16,247.1
Investment securities (fair value
$762.3 in 1997 and $745.2 in 1996) ......... 736.7 712.2
Total investment securities .............. 20,363.9 16,959.3
Loans held for sale .......................... 2,798.5 2,827.6
Mortgages held for sale ...................... 6,422.4 6,339.0
Loans and leases, net of unearned discount ... 40,783.8 39,381.0
Allowance for credit losses .................. (1,071.1) (1,040.8)
Net loans and leases ..................... 39,712.7 38,340.2
Premises and equipment, net .................. 1,236.4 1,200.9
Mortgage servicing rights, net ............... 2,719.6 2,648.5
Interest receivable and other assets ......... 4,582.7 4,302.1
Total assets ............................. $83,856.3 80,175.4

LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits
Noninterest-bearing ........................ $14,234.2 14,296.3
Interest-bearing ........................... 37,737.2 35,833.9
Total deposits ........................... 51,971.4 50,130.2
Short-term borrowings ........................ 9,480.1 7,572.6
Accrued expenses and other liabilities ....... 3,854.0 3,326.2
Long-term debt ............................... 12,043.7 13,082.2
Total liabilities ........................ 77,349.2 74,111.2
Preferred stock .............................. 282.2 249.8
Unearned ESOP shares ......................... (94.7) (61.0)
Total preferred stock .................... 187.5 188.8
Common stock, $1 2/3 par value - authorized
1,000,000,000 shares:
Issued 381,109,956 and 375,533,625 shares
in 1997 and 1996, respectively ............ 635.2 625.9
Surplus ...................................... 989.9 948.6
Retained earnings ............................ 4,661.3 4,248.2
Net unrealized gains on securities
available for sale ......................... 331.0 303.5
Notes receivable from ESOP ................... (10.1) (11.1)
Treasury stock - 6,841,172 and 6,830,919
common shares in 1997 and 1996, respectively (280.3) (233.3)
Foreign currency translation ................. (7.4) (6.4)
Total common stockholders' equity ........ 6,319.6 5,875.4
Total stockholders' equity ............... 6,507.1 6,064.2
Total liabilities and
stockholders' equity ................... $83,856.3 80,175.4

See notes to unaudited consolidated financial statements.

<PAGE>

Norwest Corporation and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)

<TABLE>
<CAPTION>
In millions, except per common share amounts Quarter Ended Six Months Ended
June 30, June 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
INTEREST INCOME ON
Loans and leases ................................ $1,115.7 1,054.4 2,211.1 2,094.2
Investment and mortgage-backed securities
available for sale ............................. 364.8 293.2 690.3 559.1
Investment securities ........................... 7.1 10.0 14.1 18.9
Loans held for sale ............................. 55.9 66.0 112.1 153.2
Mortgages held for sale ......................... 97.8 133.3 195.5 241.7
Money market investments ........................ 9.4 10.0 30.5 17.8
Trading account securities ...................... 10.8 8.1 15.3 14.1
Total interest income ....................... 1,661.5 1,575.0 3,268.9 3,099.0

INTEREST EXPENSE ON
Deposits ........................................ 358.6 326.2 714.7 636.2
Short-term borrowings ........................... 116.0 116.6 215.1 227.4
Long-term debt .................................. 187.1 215.7 381.0 428.1
Total interest expense ...................... 661.7 658.5 1,310.8 1,291.7
Net interest income ....................... 999.8 916.5 1,958.1 1,807.3
Provision for credit losses ..................... 122.8 87.4 231.8 175.2
Net interest income after
provision for credit losses ............. 877.0 829.1 1,726.3 1,632.1

NON-INTEREST INCOME
Trust ........................................... 87.5 73.4 172.2 144.2
Service charges on deposit accounts ............. 94.4 79.7 183.5 154.9
Mortgage banking ................................ 177.3 221.4 399.1 392.7
Data processing ................................. 18.3 19.1 36.4 35.6
Credit card ..................................... 27.9 29.9 55.8 61.4
Insurance ....................................... 94.9 73.3 185.1 143.0
Other fees and service charges .................. 93.8 75.6 180.2 145.2
Net investment securities gains ................. 0.3 - 0.3 -
Net investment and mortgage-backed securities
available for sale gains (losses) .............. 8.6 (45.8) 4.2 (44.1)
Net venture capital gains ....................... 93.3 65.5 112.5 132.0
Trading ......................................... 27.3 19.3 52.2 4.0
Other ........................................... 32.8 30.5 59.5 25.8
Total non-interest income ................... 756.4 641.9 1,441.0 1,194.7

NON-INTEREST EXPENSES
Salaries and benefits ........................... 569.9 511.3 1,116.5 1,020.4
Net occupancy ................................... 79.6 73.6 159.6 141.9
Equipment rentals, depreciation and maintenance . 83.5 81.4 165.7 154.1
Business development ............................ 63.7 56.9 122.1 110.1
Communication ................................... 71.3 70.1 142.8 136.6
Data processing ................................. 42.3 39.6 87.4 73.0
Intangible asset amortization ................... 43.0 34.4 83.4 72.6
Other ........................................... 166.4 143.8 283.7 245.6
Total non-interest expenses ................. 1,119.7 1,011.1 2,161.2 1,954.3
INCOME BEFORE INCOME TAXES ...................... 513.7 459.9 1,006.1 872.5
Income tax expense .............................. 182.3 174.5 352.8 315.7
NET INCOME ...................................... $ 331.4 285.4 653.3 556.8

Average common and common equivalent shares ..... 379.7 369.6 378.8 365.2
PER COMMON SHARE
Net Income
Primary ....................................... $ 0.86 0.76 1.70 1.50
Fully diluted ................................. 0.86 0.76 1.70 1.50
Dividends ...................................... 0.30 0.27 0.60 0.51

</TABLE>
See notes to unaudited consolidated financial statements.

<PAGE>

Norwest Corporation and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

<TABLE>
<CAPTION>
Six Months Ended
In millions June 30,
1997 1996
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income ............................................................$ 653.3 556.8
Adjustments to reconcile net income to net cash flows from operating
activities:
Provision for credit losses ....................................... 231.8 175.2
Depreciation and amortization ..................................... 406.0 297.3
Gains on sales of loans, securities and other assets, net ......... (221.5) (69.6)
Release of preferred shares to ESOP ............................... 19.3 22.6
Purchases of trading account securities ........................... (9,630.3) (35,919.3)
Proceeds from sales of trading account securities ................. 8,370.8 35,676.3
Originations of mortgages held for sale ........................... (22,983.4) (27,215.7)
Proceeds from sales of mortgages held for sale .................... 22,931.4 29,060.3
Originations of loans held for sale ............................... (546.9) (421.9)
Proceeds from sales of loans held for sale ........................ 585.4 1,522.2
Interest receivable ............................................... (79.6) (36.4)
Interest payable .................................................. (16.8) 14.7
Other assets, net ................................................. (421.1) (582.4)
Other accrued expenses and liabilities, net ....................... 532.1 233.3
Net cash flows from operating activities ........................ (169.5) 3,313.4

CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from maturities and paydowns of investment securities ...... 0.5 10.4
Proceeds from maturities and paydowns of investment and mortgage-
backed securities available for sale .............................. 1,152.6 1,653.8
Proceeds from sales and calls of investment securities .............. 44.0 180.7
Proceeds from sales and calls of investment and mortgage-backed
securities available for sale ..................................... 5,350.9 2,349.4
Purchases of investment securities .................................. (94.3) (262.9)
Purchases of investment and mortgage-backed securities available
for sale .......................................................... (9,009.4) (5,131.1)
Net change in banking subsidiaries' loans and leases ................ (313.2) 1,235.1
Non-bank subsidiaries' loans and leases originated .................. (4,032.2) (3,298.8)
Principal collected on non-bank subsidiaries' loans and leases ...... 3,852.2 1,985.4
Purchases of premises and equipment ................................. (151.5) (109.0)
Proceeds from sales of premises, equipment & other real estate owned 65.5 41.8
Cash paid for acquisitions, net of cash and cash equivalents acquired 27.1 (2,488.1)
Divestiture of branches, net of cash and cash equivalents paid - (23.7)
Net cash flows used for investing activities ...................... (3,107.8) (3,857.0)

CASH FLOWS FROM FINANCING ACTIVITIES
Deposits, net ....................................................... 95.3 134.3
Short-term borrowings, net .......................................... 1,783.8 724.1
Long-term debt borrowings ........................................... 1,342.0 2,372.2
Repayments of long-term debt ........................................ (2,385.1) (2,264.4)
Issuances of common stock ........................................... 34.7 43.0
Repurchases of common stock ......................................... (215.5) (127.1)
Repurchases of preferred stock ...................................... - (112.7)
Net decrease in notes receivable from ESOP .......................... 1.0 1.1
Dividends paid ...................................................... (233.5) (194.1)
Net cash flows used for financing activities ...................... 422.7 576.4
Net increase (decrease) in cash and cash equivalents .............. (2,854.6) 32.8

CASH AND CASH EQUIVALENTS
Beginning of period ................................................. 7,371.3 4,946.5
End of period .......................................................$ 4,516.7 4,979.3

See notes to unaudited consolidated financial statements.

</TABLE>

<PAGE>

Norwest Corporation and Subsidiaries
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(Unaudited)

<TABLE>
<CAPTION>
Net
Unrealized
Gains
In (Losses) on
millions, Unearned Securities Notes Foreign
except for Preferred ESOP Common Sur- Retained Available Receivable Treasury Currency
shares Stock Shares Stock plus Earnings for Sale from ESOP Stock Translation Total

<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Balance,
December 31, 1995....... $ 341.2 (38.9) 597.2 734.2 3,496.3 327.1 (13.3) (125.9) (5.8) 5,312.1
Net income............... - - - - 556.8 - - - - 556.8
Dividends on
Common stock........... - - - - (185.2) - - - - (185.2)
Preferred stock........ - - - - (8.9) - - - - (8.9)
Conversion of 22,649
preferred shares to
629,495 common shares.. (22.6) - - 2.9 - - - 19.7 - -
Repurchase of 1,127,125
preferred shares....... (112.7) - - - - - - - - (112.7)
Cash payments received
on notes receivable
from ESOP.............. - - - - - - 1.1 - - 1.1
Issuance of 59,000
preferred shares
to ESOP................ 59.0 (61.3) - 2.3 - - - - - -
Release of preferred
shares to ESOP......... - 23.5 - (0.9) - - - - - 22.6
Issuance of 1,780,038
common shares.......... - - - 31.6 (32.7) - - 51.3 - 50.2
Issuance of 18,546,938
common shares for
acquisitions........... - - 27.7 166.7 70.0 (1.6) (1.5) 62.0 - 323.3
Repurchase of 3,527,494
common shares.......... - - - - - - - (127.1) - (127.1)
Change in net unrealized
gains (losses) on
securities available
for sale............... - - - - - (197.3) - - - (197.3)
Foreign currency
translation............ - - - - - - - - - -
Balance,
June 30, 1996........... $ 264.9 (76.7) 624.9 936.8 3,896.3 128.2 (13.7) (120.0) (5.8) 5,634.9

(Continued on page 7)
</TABLE>

<PAGE>

Norwest Corporation and Subsidiaries
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(Unaudited)
(Continued from page 6)

<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Balance,
December 31, 1996...... $ 249.8 (61.0) 625.9 948.6 4,248.2 303.5 (11.1) (233.3) (6.4) 6,064.2
Net income.............. - - - - 653.3 - - - - 653.3
Dividends on
Common stock.......... - - - - (224.6) - - - - (224.6)
Preferred stock....... - - - - (8.9) - - - - (8.9)
Conversion of 19,245
preferred shares to
385,836 common shares. (19.3) - - 2.6 - - - 16.7 - -
Cash payments received
on notes receivable
from ESOP............. - - - - - - 1.0 - - 1.0
Issuance of 51,700
preferred shares to
ESOP.................. 51.7 (53.8) - 2.1 - - - - - -
Release of preferred
shares to ESOP........ - 20.1 - (0.8) - - - - - 19.3
Issuance of 2,077,165
common shares......... - - - 29.6 (49.3) - - 79.0 - 59.3
Issuance of 7,333,550
common shares for
acquisitions.......... - - 9.3 7.8 42.6 0.9 - 72.8 - 133.4
Repurchase of 4,230,473
common shares......... - - - - - - - (215.5) - (215.5)
Change in net unrealized
gains (losses) on
securities available
for sale.............. - - - - - 26.6 - - - 26.6
Foreign currency
translation........... - - - - - - - - (1.0) (1.0)
Balance,
June 30, 1997......... $ 282.2 (94.7) 635.2 989.9 4,661.3 331.0 (10.1) (280.3) (7.4) 6,507.1

See notes to unaudited consolidated financial statements.
</TABLE>

<PAGE>

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1. Changes in Accounting Policies

Effective January 1, 1997, the corporation adopted Statement of Financial
Accounting Standards No. 125, "Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities" (FAS 125). FAS 125
sets forth the criteria for determining whether a transfer of financial
assets should be accounted for as a sale or as a pledge of collateral in a
secured borrowing. FAS 125 requires that after a transfer of financial
assets, a company must recognize the financial and servicing assets
controlled and liabilities incurred, and derecognize financial assets and
liabilities in which control is surrendered or debt is extinguished. The
adoption of FAS 125 has not had a material effect on the corporation's
consolidated financial statements.

2. Consolidated Statements of Cash Flows

Supplemental disclosures of cash flow information for the six months ended
June 30, include:

In millions 1997 1996

Interest...................................... $1,327.5 1,277.0
Income taxes.................................. 84.0 55.8
Transfer of loans to other real estate owned.. 26.8 23.9

See Notes 7 and 12 for certain non-cash common and preferred stock transactions.

<PAGE>

3. Investment Securities

The amortized cost and fair value of investment securities at
June 30, 1997 were:

In millions Gross Gross
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
<S> <C> <C> <C> <C>
Available for sale:
U.S. Treasury and federal agencies .. $ 2,525.9 15.6 (13.4) 2,528.1
State, municipal and housing -
tax exempt ......................... 1,399.0 57.9 (3.8) 1,453.1
Other ............................... 721.6 261.1 (12.3) 970.4
Total investment securities
available for sale .............. 4,646.5 334.6 (29.5) 4,951.6
Mortgage-backed securities:
Federal agencies ................... 14,252.7 248.9 (44.2) 14,457.4
Collateralized mortgage
obligations ....................... 208.1 13.5 (3.4) 218.2
Total mortgage-backed securities
available for sale .............. 14,460.8 262.4 (47.6) 14,675.6
Total investment and
mortgage-backed securities
available for sale .................. 19,107.3 597.0 (77.1) 19,627.2

Other securities held for investment . 736.7 26.9 (1.3) 762.3

Total investment securities ........ $19,844.0 623.9 (78.4) 20,389.5

</TABLE>

Interest income on investment securities for the quarters and six months
ended June 30, was:

Quarter Six Months
In millions 1997 1996 1997 1996

Available for sale:
U.S. Treasury and federal agencies .. $ 64.4 19.8 96.5 37.1
State, municipal and housing -
tax exempt ........................ 20.0 13.2 34.6 25.8
Other ............................... 9.7 12.1 24.2 23.0
Total investment securities
available for sale .............. 94.1 45.1 155.3 85.9
Mortgage-backed securities:
Federal agencies ................... 266.7 246.1 526.6 467.5
Collateralized mortgage
obligations ....................... 4.0 2.0 8.4 5.7
Total mortgage-backed securities
available for sale .............. 270.7 248.1 535.0 473.2
Total investment and mortgage-backed
securities available for sale ...... 364.8 293.2 690.3 559.1

Other securities held for investment . 7.1 10.0 14.1 18.9

Total investment securities ........ $ 371.9 303.2 704.4 578.0

Certain investment securities with a total amortized cost of $38.5 million
and $43.7 million for the three and six months ended June 30, 1997,
respectively, and $4.7 million and $5.5 million for the three and six
months ended June 30, 1996, respectively, were sold by the corporation due
to significant deterioration in the creditworthiness of the related issuers
or because such securities were called by the issuers prior to maturity.
The sales and calls of investment securities resulted in a gain of $0.3
million for the quarter and six months ended June 30, 1997. Sales and
calls of investment securities resulted in no gain or loss for the quarter
and six months ended June 30, 1996.

<PAGE>

4. Loans and Leases

The carrying values of loans and leases at June 30, 1997 and
December 31, 1996 were:
<TABLE>
<CAPTION>

In millions June 30, December 31,
1997 1996
<S> <C> <C>
Commercial, financial and industrial ..... $10,749.9 10,204.9
Agricultural ............................. 1,151.2 1,107.7
Real estate
Secured by 1-4 family residential
properties ........................... 10,821.0 10,376.3
Secured by development properties ...... 2,261.4 2,104.5
Secured by construction and land
development .......................... 981.9 943.8
Secured by owner-occupied properties ... 2,711.2 2,644.6
Consumer ................................. 10,613.0 10,431.2
Credit card .............................. 1,502.9 1,566.2
Lease financing .......................... 795.9 812.4
Foreign
Consumer ............................... 822.9 774.9
Commercial ............................. 197.6 187.7
Total loans and leases ............... 42,608.9 41,154.2
Unearned discount ........................ (1,825.1) (1,773.2)
Total loans and leases, net of
unearned discount .................... $40,783.8 39,381.0

</TABLE>

Changes in the allowance for credit losses for the quarters and six months
ended June 30, were:
<TABLE>
<CAPTION>
Quarter Six Months
In millions 1997 1996 1997 1996

<S> <C> <C> <C> <C>
Balance at beginning of period ....... $1,062.6 959.7 1,040.8 917.2
Allowance related to assets
acquired, net ..................... 0.5 45.7 25.3 85.9
Provision for credit losses ........ 122.8 87.4 231.8 175.2

Credit losses ...................... (157.0) (113.1) (303.7) (229.1)
Recoveries ......................... 42.2 29.2 76.9 59.7
Net credit losses ................ (114.8) (83.9) (226.8) (169.4)
Balance at end of period ............. $1,071.1 1,008.9 1,071.1 1,008.9

</TABLE>

<PAGE>

5. Non-performing Assets and 90-day Past Due Loans and Leases

Total non-performing assets and 90-day past due loans and leases at June 30,
1997 and 1996 and December 31, 1996 were:

In millions June 30, December 31,
1997 1996 1996
Impaired loans
Non-accrual ........................... $ 113.5 109.9 94.0
Restructured .......................... 0.2 1.4 0.2
Total impaired loans ................ 113.7 111.3 94.2
Other non-accrual loans and leases ...... 74.2 72.2 62.5
Total non-accrual and
restructured loans and leases ........ 187.9 183.5 156.7
Other real estate owned ................. 44.8 41.8 43.3
Total non-performing assets ........... 232.7 225.3 200.0
Loans and leases past due 90 days or more* 115.4 93.3 110.7
Total non-performing assets and
90-day past due loans and leases ..... $ 348.1 318.6 310.7

* Excludes non-accrual and restructured loans and leases.

The average balances of impaired loans for the six months ended June 30,
1997 and 1996 were $108.4 million and $108.7 million, respectively. The
allowance for credit losses related to impaired loans at June 30, 1997 and
December 31, 1996 was $33.9 million and $31.4 million, respectively.
Impaired loans of $2.4 million and $0.9 million were not subject to a
related allowance for credit losses at June 30, 1997 and December 31, 1996,
respectively, because of the net realizable value of loan collateral,
guarantees and other factors.

The effect of non-accrual and restructured loans on interest income for the
quarters and six months ended June 30, was:

Quarter Six Months
In millions 1997 1996 1997 1996

Interest
As originally contracted ........... $ 6.1 5.6 11.3 10.2
As recognized ...................... (0.9) (1.5) (1.4) (2.0)
Reduction of interest income ..... $ 5.2 4.1 9.9 8.2

6. Long-term Debt

During the first six months of 1997, the corporation issued $200 million in
medium-term notes bearing a fixed interest rate of 6.75 percent, which
mature in June 2007. Also, during the first six months of 1997, certain
subsidiaries of the corporation received advances from the Federal Home Loan
Bank. Advances of $775 million were issued bearing interest at rates
ranging from one-month LIBOR less 17 basis points to three-month LIBOR less
seven basis points, and which mature between September 1997 and September
2000. Norwest Financial, Inc. issued $362 million in senior notes in the
first half of 1997 bearing interest at fixed rates ranging from 4.90
percent to 7.20 percent, which mature from March 2000 to May 2007.

<PAGE>

7. Stockholders' Equity

The table below is a summary of the corporation's preferred and preference
stock at June 30, 1997 and December 31, 1996. A detailed description of the
corporation's preferred and preference stock is provided in Note 10 to the
audited consolidated financial statements included in the corporation's 1996
annual report on Form 10-K.

In millions, except share amounts

Annual
Dividend
Shares Outstanding Rate at Amount Outstanding
June 30, December 31, June 30, June 30, December 31,
1997 1996 1997 1997 1996
<S> <C> <C> <C> <C> <C>
Cumulative
Tracking, $200
stated value .............. 980,000 980,000 9.30% $196.0 196.0
1997 ESOP Cumulative
Convertible, $1,000 stated
value ..................... 35,058 - 9.50% 35.0 -
1996 ESOP Cumulative
Convertible, $1,000 stated
value ..................... 23,663 24,469 8.50% 23.7 24.5
1995 ESOP Cumulative
Convertible, $1,000 stated
value ..................... 21,690 22,716 10.00% 21.7 22.7
ESOP Cumulative Convertible,
$1,000 stated value ....... 10,823 11,594 9.00% 10.8 11.6
Less: Cumulative
Tracking shares held by
a subsidiary .............. (25,000) (25,000) (5.0) (5.0)
1,046,234 1,013,779 282.2 249.8
Unearned ESOP shares ........ (94.7) (61.0)
Total preferred stock ... $ 187.5 188.8

</TABLE>

On February 24, 1997, the corporation issued 51,700 shares of 1997 ESOP
Cumulative Convertible Preferred Stock, $1,000 stated value per share
("1997 ESOP Preferred Stock"), in the stated amount of $51.7 million at a
premium of $2.1 million; a corresponding charge of $53.8 million was
recorded to unearned ESOP shares.

On February 26, 1996, the corporation issued 59,000 shares of 1996 ESOP
Cumulative Convertible Preferred Stock, $1,000 stated value per share
("1996 ESOP Preferred Stock"), in the stated amount of $59.0 million at a
premium of $2.3 million; a corresponding charge of $61.3 million was
recorded to unearned ESOP shares.

During the quarter and six months ended June 30, 1997, 7,678 and 19,245
shares of ESOP Preferred Stock were converted into 137,520 and 385,836
shares of common stock of the corporation, respectively. During the
quarter and six months ended June 30, 1996, 9,243 and 22,649 shares of ESOP
Preferred Stock were converted into 265,824 shares and 629,495 shares of
common stock of the corporation, respectively.

On July 10, 1997, the market value of the corporation's common stock closed
above $60 per share, the vesting price for options granted under the
corporation's Best Practices PartnerShares Plan, a broad-based employee
stock option plan.

<PAGE>

8. Business Segments

The corporation's operations include three primary business segments:
banking, mortgage banking and consumer finance. See Note 16 to the audited
consolidated financial statements included in the corporation's annual
report on Form 10-K for the year ended December 31, 1996 for a detailed
description of each business segment. Selected financial information by
business segment for the quarters and six months ended June 30 is included
in the following summary:

In millions
Quarter Six Months
1997 1996 1997 1996
Revenues:*
Banking ................ $ 1,608.0 1,410.9 3,099.8 2,755.0
Mortgage Banking ....... 347.1 368.9 691.5 670.2
Norwest Financial ...... 462.8 437.1 918.6 868.5
Total ................ $ 2,417.9 2,216.9 4,709.9 4,293.7
Organizational earnings:*
Banking ................ $ 229.7 189.3 456.2 370.5
Mortgage Banking ....... 35.3 30.7 69.1 61.1
Norwest Financial ...... 66.4 65.4 128.0 125.2
Total ................ $ 331.4 285.4 653.3 556.8
Total assets:
Banking ................ $62,759.1 56,930.6
Mortgage Banking ....... 12,111.3 12,438.2
Norwest Financial ...... 8,985.9 8,480.5
Total ................ $83,856.3 77,849.3

* Revenues (interest income plus non-interest income), where applicable,
and organizational earnings by business segment are impacted by
intercompany revenues and expenses, such as interest on borrowings
from the parent company, corporate service fees and allocation of
federal income taxes.

9. Mortgage Banking Activities

Additional information about mortgage banking non-interest income for the
quarters and six months ended June 30, is presented below:

Quarter Six Months
In millions 1997 1996 1997 1996

Origination and other
closing fees ............ $ 77.8 88.6 136.4 160.9
Servicing fees ............ 45.7 69.1 140.8 127.5
Net gains (losses) on sales
of servicing rights ..... (2.6) 24.7 (2.4) 39.8
Net gains (losses) on
sales of mortgages ...... 14.5 2.6 46.0 (3.1)
Other ..................... 41.9 36.4 78.3 67.6
Total mortgage banking
non-interest income ... $177.3 221.4 399.1 392.7

<PAGE>

Mortgage loans serviced for others are not included in the accompanying
consolidated balance sheets. The outstanding balances of serviced loans
were $191.1 billion and $168.0 billion at June 30, 1997 and 1996,
respectively, and $179.7 billion at December 31, 1996.

Changes in capitalized mortgage servicing rights for the quarters and six
months ended June 30, were:

Quarter Six Months
In millions 1997 1996 1997 1996

Mortgage servicing rights:

Balance at beginning
of period ............ $2,785.1 1,502.3 2,712.7 1,290.9
Originations ........... 82.0 99.8 159.8 184.0
Purchases and other
additions ............ 76.9 1,034.3 108.6 1,225.5
Sales .................. - (0.5) (17.4) (17.4)
Amortization ........... (131.6) (69.1) (217.2) (116.1)
Other .................. (28.6) (0.2) 37.3 (0.3)
2,783.8 2,566.6 2,783.8 2,566.6
Less valuation allowance (64.2) (64.2) (64.2) (64.2)
Balance at end of period . $2,719.6 2,502.4 2,719.6 2,502.4

The fair value of capitalized mortgage servicing rights at June 30, 1997
was approximately $3.3 billion, calculated using discount rates ranging
from 500 to 700 basis points over the ten-year U.S. Treasury rate.

There were no changes in the valuation allowance for capitalized mortgage
servicing rights during the quarters ended June 30, 1997 and 1996.

10. Trading Revenues

For the quarters and six months ended June 30, trading revenues were
derived from the following activities:

Quarter Six Months
In millions 1997 1996 1997 1996

Interest income:
Securities .............................. $ 10.8 8.1 15.3 14.1

Non-interest income:
Gains(losses) on securities sold ........ 16.3 11.5 31.6 (14.8)
Swaps and other interest rate contracts . 0.3 14.7 0.6 23.2
Foreign exchange trading ................ 3.9 2.1 7.6 4.2
Options ................................. 1.7 (7.7) 3.8 (9.3)
Futures ................................. 5.1 (1.3) 8.6 0.7
Total non-interest income ............. 27.3 19.3 52.2 4.0
Total trading revenues .................... $ 38.1 27.4 67.5 18.1

<PAGE>

11. Derivative Activities

The corporation and its subsidiaries, as end-users, utilize various types
of derivative products (principally interest rate swaps and interest rate
caps and floors) as part of an overall interest rate risk management
strategy. See Note 15 to the audited consolidated financial statements
included in the corporation's annual report on Form 10-K for the year ended
December 31, 1996 for a detailed description of derivative products
utilized in end-user activities.

Interest rate swaps generally involve the exchange of fixed and floating
rate interest payments based on an underlying notional amount. Generic
swaps' notional amounts do not change for the life of the contract. The
rate of return on the amortizing swaps is the underlying coupon yield,
paydown adjustment and price characteristics of an amortizing pool of
mortgages or mortgage-backed securities. Basis swaps are contracts where
the corporation receives an amount and pays an amount based on different
floating indices. Currently, interest rate floors, futures contracts and
options on futures contracts are principally being used by the corporation
in hedging its portfolio of mortgage servicing rights. The floors provide
for the receipt of payments when interest rates are below predetermined
interest rate levels. The unrealized gains (losses) on interest rate
floors and futures contracts are included, as appropriate, in determining
the fair value of the capitalized mortgage servicing rights.

For the six months ended June 30, 1997, end-user derivative activities
decreased interest income by $1.1 million and interest expense by $36.4
million, for a total benefit to net interest income of $35.3 million. For
the same period in 1996, the total benefit to net interest income was
$34.3 million.

Activity in the notional amounts of end-user derivatives for the six months
ended June 30, 1997 is summarized as follows:

In millions December 31, Amortization June 30,
1996 Additions & Maturities Terminations 1997
Swaps:
<S> <C> <C> <C> <C> <C>
Generic receive fixed ..... $ 4,602 703 (450) (39) 4,816

Amortizing receive fixed .. 83 3,261 (8) (41) 3,295

Generic pay fixed ......... 354 15 (2) (150) 217

Basis ..................... 29 - - - 29

Total swaps ............. 5,068 3,979 (460) (230) 8,357

Interest rate caps
and floors ................ 15,977 6,000 - (1,550) 20,427

Futures contracts ........... 3,617 13,980 - (12,732) 4,865

Options on futures contracts. 5,559 28,739 (6,826) (17,663) 9,809

Security options ............ 825 2,400 (1,875) (900) 450

Total ....................... $ 31,046 55,098 (9,161) (33,075) 43,908

</TABLE>

Deferred gains and losses on closed end-user derivatives were not material
at June 30, 1997 and December 31, 1996.

<PAGE>

A key assumption in the information which follows is that rates remain
constant at June 30, 1997 levels. To the extent that rates change, both
the average notional and variable interest rate information may change.

The following table presents the maturities and weighted average rates for
end-user derivatives by type:

Dollars in millions
Maturity
There-
June 30, 1997 1997 1998 1999 2000 2001 after Total

<S> <C> <C> <C> <C> <C> <C> <C>
Swaps:
Generic receive fixed-
Notional value ........$ 500 650 766 400 500 2,000 4,816
Weighted avg.
receive rate ........ 6.33% 6.34 7.28 6.17 6.35 6.60 6.58
Weighted avg. pay rate 5.73% 5.81 5.72 5.80 5.82 5.79 5.78
Amortizing receive fixed-
Notional value ........$ - 20 2,019 1,256 - - 3,295
Weighted avg.
receive rate ........ -% 2.89 7.42 6.47 - - 7.03
Weighted avg. pay rate -% 5.91 5.53 5.64 - - 5.57
Generic pay fixed-
Notional value ........$ 3 - - - 4 210 217
Weighted avg.
receive rate ........ 5.69% - - - 5.69 5.80 5.80
Weighted avg. pay rate 6.37% - - - 6.29 5.86 5.87
Basis-
Notional value ........$ - 29 - - - - 29
Weighted avg.
receive rate ........ -% 4.45 - - - - 4.45
Weighted avg. pay rate -% 3.63 - - - - 3.63

Interest rate caps and
floors (1):
Notional value ........$ - 527 400 5,750 5,750 8,000 20,427

Futures contracts (1):
Notional value ........$ 4,865 - - - - - 4,865

Options on futures
contracts (1):
Notional value ........$ 9,109 700 - - - - 9,809

Security options (1)
Notional value ........$ 450 - - - - - 450

Total notional value ....$14,927 1,926 3,185 7,406 6,254 10,210 43,908

Total weighted avg.
rates on swaps:
Receive rate ........ 6.33% 6.16 7.38 6.40 6.34 6.52 6.73

Pay rate ............ 5.73% 5.73 5.58 5.68 5.83 5.79 5.69

(1) Average rates are not meaningful for interest rate caps and floors, futures
contracts or options.

Note: Weighted average variable rates are based on the actual rates as of
June 30, 1997.

</TABLE>

<PAGE>

The following table provides the gross gains and gross losses not yet
recognized in the consolidated financial statements for open end-user
derivatives applicable to certain hedged assets and liabilities:

In millions Balance Sheet Category
Loans Mortgage Interest- Long-
Investment and Servicing bearing term
June 30, 1997 Securities Leases Rights Deposits Debt Total
<S> <C> <C> <C> <C> <C> <C>
Swaps:
Pay variable
Unrealized gains ........ $ - - 7.5 30.5 40.5 78.5
Unrealized (losses) ..... - - (3.0) (0.5) (28.0) (31.5)

Pay variable net ........ - - 4.5 30.0 12.5 47.0

Pay fixed
Unrealized gains ........ - 1.8 - 4.1 - 5.9
Unrealized (losses) ..... - - - - - -

Pay fixed net ........... - 1.8 - 4.1 - 5.9

Basis
Unrealized gains ........ 0.3 - - - - 0.3
Unrealized (losses) ..... - (0.1) - - - (0.1)

Pay basis net ........... 0.3 (0.1) - - - 0.2

Total unrealized gains .... 0.3 1.8 7.5 34.6 40.5 84.7
Total unrealized (losses) . - (0.1) (3.0) (0.5) (28.0) (31.6)

Total net ............... $ 0.3 1.7 4.5 34.1 12.5 53.1

Interest rate caps and floors:
Unrealized gains .......... $ 6.5 - 16.9 - - 23.4
Unrealized (losses) ....... - - (44.5) (0.1) (0.1) (44.7)

Total net ............... $ 6.5 - (27.6) (0.1) (0.1) (21.3)

Futures contracts:
Unrealized gains .......... $ - 1.0 20.7 - - 21.7
Unrealized (losses) ....... - - (1.5) - - (1.5)

Total net ............... $ - 1.0 19.2 - - 20.2

Options on futures contracts:
Unrealized gains .......... $ - 0.2 7.8 - - 8.0
Unrealized (losses) ....... - (1.3) (10.3) - - (11.6)

Total net ............... $ - (1.1) (2.5) - - (3.6)

Security options:
Unrealized gains .......... $ - 1.4 - - - 1.4
Unrealized (losses) ....... - (3.6) - - - (3.6)

Total net ............... $ - (2.2) - - - (2.2)

Grand total
unrealized gains ........ $ 6.8 4.4 52.9 34.6 40.5 139.2
Grand total
unrealized (losses) ..... - (5.0) (59.3) (0.6) (28.1) (93.0)

Grand total net ........... $ 6.8 (0.6) (6.4) 34.0 12.4 46.2

</TABLE>

<PAGE>

As a result of interest rate fluctuations, off-balance sheet derivatives
have unrealized appreciation or depreciation in market values as compared
with their cost. As these derivatives hedge certain assets and liabilities
of the corporation, as noted in the table above, there has been offsetting
unrealized appreciation and depreciation in the assets and liabilities
hedged.

The corporation has entered into mandatory and standby forward contracts,
including options on forward contracts, to reduce interest rate risk on
certain mortgage loans held for sale and other commitments. The contracts
provide for the delivery of securities at a specified future date, at a
specified price or yield. At June 30, 1997, the corporation had forward
contracts and options on forward contracts totaling $22.7 billion, all of
which mature within 180 days. Gains and losses on forward contracts and
options on forward contracts are included in the determination of market
value of mortgages held for sale.

At June 30, 1997, the corporation's trading account portfolio included
futures of $2.0 billion notional value, which are valued at market with any
gains or losses recognized currently.

12. Business Combinations

The corporation regularly explores opportunities for acquisitions of
financial institutions and related businesses. Generally, management of
the corporation does not make a public announcement about an acquisition
opportunity until a definitive agreement has been signed. At June 30,
1997, the corporation had nine pending acquisitions with total assets of
approximately $2.5 billion, and it is anticipated that cash of $331.2
million and approximately 4.8 million common shares will be issued upon
completion of these acquisitions. Pending acquisitions include Fidelity
Acceptance Corporation, an automobile finance company with $1.1 billion in
receivables based in Kansas City, Missouri.

These pending acquisitions, subject to approval by regulatory agencies, are
expected to be completed by the end of 1997 and are not
significant to the financial statements of the corporation, either
individually or in the aggregate.

<PAGE>

Transactions completed in the six months ended June 30, 1997 include:

<TABLE>
<CAPTION>
In millions, except share amounts Common
Cash Shares Method of
Date Assets Paid Issued Accounting
<S> <C> <C> <C> <C> <C>
Franklin Federal
Bancorp., F.S.B.
Austin, Texas (B) ............ January 1 $ 621.3 $ 90.0 - Purchase of
assets
Central Bancorporation, Inc.
Fort Worth, Texas (B) ........ January 28 1,105.3 - 4,699,788 Pooling of
interests*
Reliable Financial
Services, Inc.
San Juan, Puerto (F) ......... February 21 38.6 - 876,543 Pooling of
interests*
Statewide Mortgage Company,
Birmingham, Alabama (B) ...... February 26 27.9 - 524,996 Purchase
The United Group, Inc.
Charlotte, North Carolina (F). March 21 40.6 - 324,174 Purchase
Farmers National Bancorp, Inc.
Geneseo, Illinois (B) ........ March 24 197.6 - 603,599 Purchase
The First National
Bankshares, Inc.,
Tucumcari, New Mexico (B) .... June 17 90.2 - 304,450 Purchase
$2,121.5 $ 90.0 7,333,550

* Pooling of interests transactions were not material to the corporation's
consolidated financial statements; accordingly, previously reported results
have not been restated.
(B) - Banking Group; (F) - Norwest Financial
</TABLE>

<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.

Management's discussion and analysis should be read together with the
financial statements submitted under Item 1 of Part I and with Norwest
Corporation's 1996 Annual Report on Form 10-K.

EARNINGS PERFORMANCE

The corporation reported net income of $331.4 million for the quarter ended
June 30, 1997, a 16.1 percent increase over the $285.4 million earned in
the second quarter of 1996. Fully diluted earnings per share were
86 cents, compared with 76 cents in the second quarter of 1996, an increase
of 13.2 percent. Return on realized common equity was 22.1 percent and
return on assets was 1.61 percent for the second quarter of 1997, compared
with 22.1 percent and 1.50 percent, respectively, in the second quarter of
1996.

For the six months ended June 30, 1997, net income was $653.3 million, or
$1.70 per fully diluted common share, an increase of 17.3 percent and 13.3
percent, respectively, over the $556.8 million, or $1.50 per common share,
earned in the first six months of 1996. Return on realized common equity
was unchanged from the prior year at 22.4 percent and return on assets was
1.62 percent, compared with 1.50 percent for the same period a year ago.

ORGANIZATIONAL EARNINGS

The organizational earnings of the corporation's primary business segments
are included in Note 8 to the unaudited consolidated financial statements
for the three and six months ended June 30, 1997 and 1996 and are discussed
in the following paragraphs.

Banking Group

The Banking Group reported second quarter 1997 earnings of $229.7 million,
a 21.4 percent increase over the second quarter 1996 earnings of $189.3
million. For the six months ended June 30, 1997, earnings increased 23.1
percent to $456.2 million compared with $370.5 million for the same period
in 1996. The increased earnings in the first six months of 1997 reflect a
12.7 percent increase in tax-equivalent net interest income to
$1,408.0 million, primarily due to an 11.3 percent increase in average
earning assets and a five basis point increase in net interest margin. The
Banking Group's provision for credit losses for the six months ended
June 30, 1997 increased $33.4 million to $95.3 million from a year earlier,
as average loans and leases rose $2.1 billion, or 7.2 percent, and net
charge-offs as a percent of average loans and leases increased 23 basis
points to 0.64 percent. Non-interest income rose $167.9 million to $839.7
million for the first six months of 1997, due primarily to growth in trust,
fees and service charges, insurance, and investment securities gains.
Non-interest expenses of $1,435.5 million for the first six months of 1997
were $171.3 million higher when compared with the first six months of 1996,
reflecting additional operating expenses from acquired companies.

<PAGE>

Mortgage Banking

Mortgage Banking earned $35.3 million in the current quarter compared with
$30.7 million in the second quarter of 1996. For the first six months of
1997, Mortgage Banking earned $69.1 million compared with $61.1 million in
the same period of 1996. See Note 9 to the unaudited consolidated
financial statements for additional information about mortgage banking
revenues for the three and six months ended June 30, 1997 and 1996.

The growth in Mortgage Banking earnings over the first half of 1996
reflects higher servicing fees from a larger servicing portfolio and an
increase in the combined gains on sales of mortgages and servicing rights
to $43.6 million in the first six months of 1997, compared with $36.7
million in the same period a year ago. Mortgage loan originations amounted
to $12.6 billion during the second quarter, and totaled $23.0 billion for
the first half of 1997, compared with $14.9 billion and $26.7 billion,
respectively, in the comparable periods in 1996. The unclosed pipeline of
mortgage loans was $11.0 billion at June 30, 1997, compared with $7.7
billion at December 31, 1996. The servicing portfolio had a weighted
average coupon of 7.78 percent and totaled $191.1 billion at June 30, 1997,
compared with $179.7 billion at December 31, 1996. Capitalized mortgage
servicing rights amounted to $2.7 billion, or 142 basis points of the
mortgage servicing portfolio at June 30, 1997, compared with $2.6 billion,
or 147 basis points, at December 31, 1996.

Norwest Financial

Norwest Financial (including Norwest Financial Services, Inc. and Island
Finance) reported earnings of $66.4 million in the second quarter of 1997,
compared with $65.4 million in the second quarter of 1996, an increase of
1.5 percent. For the first six months of 1997, Norwest Financial's net
income was $128.0 million, up 2.2 percent from the first six months of
1996. The growth in earnings reflected a 5.6 percent increase in Norwest
Financial's tax-equivalent net interest income as average finance
receivables grew 4.9 percent from the first half of 1996. Norwest
Financial's net charge-offs in the first six months of 1997 were $125.6
million, or 3.39 percent of average loans, compared with $108.1 million, or
3.05 percent of average loans, in the same period in 1996. The corporation
recently agreed to acquire Fidelity Acceptance Corporation, an automobile
finance company with $1.1 billion in receivables and 150 locations in 31
states and Guam, which will be managed by Norwest Financial. This
transaction is expected to close in the third quarter of 1997.

CONSOLIDATED INCOME STATEMENT ANALYSIS

Net Interest Income

Consolidated tax-equivalent net interest income was $1,011.6 million in the
second quarter of 1997, compared with $924.5 million in the second quarter
of 1996, an increase of 9.4 percent. For the first six months of 1997, tax-
equivalent net interest income increased 8.6 percent from the same period
in 1996 to $1,978.8 million. Growth in tax-equivalent net interest income
over the second quarter ended June 30, 1996 was primarily due to a 6.4
percent growth in average earning assets, principally investment securities
and loans. Net interest margin, the ratio of annualized tax-equivalent net
interest income to average earning assets, was 5.69 percent in the second
quarter of 1997, compared with 5.54 percent in the second quarter of 1996.
The increase in net interest margin from second quarter of 1996 is
primarily due to a reduction in funding costs.

<PAGE>

The following table summarizes changes in tax-equivalent net interest
income between the quarters ended June 30 and March 31 and the six months
ended June 30.

<TABLE>
<CAPTION>
Changes in Tax-Equivalent Net Interest Income*
In millions 2Q 97 2Q 97 6 Mos. 97
from from from
2Q 96 1Q 97 6 Mos. 96
<S> <C> <C> <C>
Increase (decrease) due to:
Change in earning asset volume ............ $ 60.6 29.2 143.0
Change in volume of interest-free funds ... 25.0 8.8 37.4
Change in net return from
Interest-free funds ...................... (2.7) 0.3 (8.2)
Interest-bearing funds ................... (3.7) 7.4 (16.7)
Change in earning asset mix ............... (11.0) (3.1) (33.2)
Change in funding mix ..................... 18.9 1.8 33.7
Change in tax-equivalent net interest income. $ 87.1 44.4 156.0

* Net interest income is presented on a tax-equivalent basis using a
federal incremental tax rate of 35 percent in each period presented.

</TABLE>

Provision for Credit Losses

The corporation provided $122.8 million for credit losses in the second
quarter of 1997, compared with $87.4 million in the same period a year ago.
Net credit losses totaled $114.8 million and $83.9 million for the three
months ended June 30, 1997 and 1996, respectively. As a percentage of
average loans and leases, net credit losses were 114 basis points in the
second quarter of 1997, compared with 88 basis points in the same period a
year ago.

For the first six months of 1997, the provision for credit losses totaled
$231.8 million, compared with $175.2 million in the first six months of
1996. Net credit losses were $226.8 million, or 1.14 percent of average
loans and leases, for the six months ended June 30, 1997, compared with
$169.4 million, or 0.91 percent, for the same period in 1996. The increase
in net credit losses over 1996 is principally due to higher levels of
charge-offs in regions where the corporation has had acquisitions and to
higher consumer credit charge-offs.

Non-interest Income

Consolidated non-interest income was $756.4 million in the second quarter
of 1997, an increase of $114.5 million, or 17.8 percent, from the second
quarter of 1996. Contributing to the 1997 increase was continued growth in
trust, fees and service charges, insurance, and investment securities and
venture capital gains. The increases in trust revenues, fees and service
charges and insurance reflect overall increases in business activity,
including acquisitions, and marketing efforts. For the six months ended
June 30, 1997, non-interest income was up $246.3 million to $1,441.0
million, an increase of 20.6 percent over 1996. The increase was due to
higher revenues in essentially all categories.

Mortgage banking revenues in the second quarter of 1997 were $177.3
million, compared with $221.4 million in the second quarter of 1996. For
the six months ended June 30, 1997, mortgage banking revenues were $399.1
million, compared with $392.7 million for the first half of 1996. In the
second quarter of 1997, the corporation elected to accelerate amortization
of capitalized mortgage servicing rights and recorded an additional $42.0
million of amortization. Amortization of capitalized servicing rights was
$131.7 million and $217.3 million, respectively, for the three and six-
month periods ended June 30, 1997, compared with $69.2 million and $116.2
million, respectively, for the comparable periods of 1996. See Note 9 to
the unaudited consolidated financial statements for additional information
about mortgage banking revenues for the three and six months ended June 30,
1997 and 1996. Mortgage banking revenue derived from sales of servicing
rights are largely dependent upon portfolio characteristics and prevailing
market conditions.

<PAGE>

Net venture capital gains were $93.3 million for the three months and
$112.5 million for the six months ended June 30, 1997, compared with $65.5
million and $132.0 million, respectively, for the same periods in 1996.
Sales of venture capital securities generally relate to timing of holdings
becoming publicly traded and subsequent market conditions, causing venture
capital gains to be unpredictable in nature. Net unrealized appreciation
in the venture capital investment portfolio was $187.9 million at June 30,
1997.

Insurance revenues in the second quarter of 1997 were $94.9 million,
compared with $73.3 million in the corresponding period in 1996. For the
first six months of 1997, insurance revenues amounted to $185.1 million,
compared with $143.0 million in the corresponding period in 1996. The
increases in insurance revenues are primarily attributed to commissions on
higher sales of crop hail and credit life insurance.

The corporation's trading revenue for the second quarter of 1997 was $27.3
million, compared with $19.3 million in the second quarter of 1996.
Trading revenues amounted to $52.2 million in the first half of 1997,
compared with the $4.0 million in the same period of 1996. See Note 10 to
the unaudited consolidated financial statements for a detailed analysis of
trading revenues for the three and six months ended June 30, 1997 and 1996.

Non-interest Expenses

Consolidated non-interest expenses were $1,119.7 million in the second
quarter of 1997, an increase of 10.7 percent from the second quarter of
1996. The increase in non-interest expenses was the result of higher
operating expenses associated with acquisitions and $28.5 million in other
non-interest expenses due to writedowns of intangible and other assets.
For the six months ended June 30, 1997, non-interest expenses increased
$206.9 million, or 10.6 percent, over the six months ended June 30, 1996,
and primarily reflect increased expenses related to acquired companies.
During 1997, the corporation recorded non-recurring charges of $6.0 million
related to completed acquisitions.

CONSOLIDATED BALANCE SHEET ANALYSIS

At June 30, 1997, earning assets were $72.4 billion, an increase of 6.1
percent from $68.2 billion at December 31, 1996. This increase was
primarily due to a 20.1 percent increase in total investment securities.
The increase is due to purchases of securities with short term funds
pending reinvestment at year-end 1996 and to acquisitions.

At June 30, 1997, interest-bearing liabilities totaled $59.3 billion, a 4.9
percent increase from $56.5 billion at December 31, 1996. The increase was
primarily due to increases in interest-bearing deposits due to acquisitions
and an increase in short-term borrowings, partially offset by a decrease in
long-term debt.

<PAGE>

Credit Quality

The major categories of loans and leases are included in Note 4 to the
unaudited consolidated financial statements for the quarter ended June 30,
1997.

At June 30, 1997, the allowance for credit losses totaled $1,071.1 million,
or 2.63 percent of loans and leases outstanding. Comparable amounts were
$1,008.9 million, or 2.61 percent, at June 30, 1996, and $1,040.8 million,
or 2.64 percent, at December 31, 1996. The ratio of the allowance for
credit losses to total non-performing assets and 90-day past due loans and
leases was 307.7 percent at June 30, 1997, compared with 316.7 percent at
June 30, 1996 and 335.0 percent at December 31, 1996.

Although it is impossible for any lender to predict future credit losses
with complete accuracy, management monitors the allowance for credit losses
with the intent to provide for all losses that can reasonably be
anticipated based on current conditions. The corporation maintains the
allowance for credit losses as a general allowance available to cover
future credit losses within the entire loan and lease portfolio and other
credit-related risks. However, management has prepared an allocation of
the allowance based on its views of risk characteristics of the portfolio.
This allocation of the allowance for credit losses does not represent the
total amount available for actual future credit losses in any single
category nor does it prohibit future credit losses from being absorbed by
portions of the allowance allocated to other categories or by the
unallocated portion.

The allocation of the allowance for credit losses to major categories of
loans at June 30, 1997 and December 31, 1996 was:

June 30, December 31,
1997 1996

Commercial .................... $ 199.9 208.6
Consumer ...................... 331.4 285.7
Real estate ................... 140.8 150.3
Foreign ....................... 34.9 32.3
Unallocated ................... 364.1 363.9
Total ...................... $1,071.1 1,040.8

Non-performing assets and 90-day past due loans and leases totaled $348.1
million, or 0.42 percent of total assets, at June 30, 1997, compared with
$318.6 million, or 0.41 percent, at June 30, 1996, and $310.7 million, or
0.39 percent, at December 31, 1996.

The corporation manages exposure to credit risk through loan portfolio
diversification by customer, product, industry and geography in order to
minimize concentrations in any single sector.

The corporation's Banking Group operates in 16 states, largely in the
Midwest, Southwest and Rocky Mountain regions of the country. Distribution
of average loans by region during the first half of 1997 was approximately
58 percent in the North Central Midwest, 12 percent in the South Central
Midwest and 30 percent in the Rocky Mountain/Southwest region.

<PAGE>

Norwest Mortgage, Norwest Financial and Norwest Card Services operate on a
nationwide basis. Mortgage Banking includes the largest retail mortgage
origination network and the largest servicing portfolio in the United
States. The five states with the highest originations year to date in 1997
are: California $4,252.1 million; Minnesota $1,146.4 million; Washington
$1,083.8 million; New Jersey $1,042.4 million; and Illinois $1,032.9
million. The originations in these five states comprise approximately 37
percent of total originations in 1997. The five largest states in the
servicing portfolio include: California $37.8 billion; Minnesota $10.8
billion; Texas $9.2 billion; New York $8.9 billion; and Florida $8.1
billion. These five states comprise approximately 39 percent of the total
servicing portfolio at June 30, 1997.

Norwest Financial engages in consumer finance activities in 48 states, all
10 Canadian provinces, the Caribbean, Central America, Saipan and Guam.
The five states with the largest consumer finance receivables are:
California $441.8 million; Illinois $218.8 million; Florida $214.1 million;
Texas $207.3 million; and Minnesota $167.7 million. Consumer finance
receivables in Puerto Rico and Canada totaled $1.3 billion and $596.3
million, respectively, at June 30, 1997. The consumer finance receivables
of Puerto Rico, Canada, and the five largest states listed above comprise
approximately 44 percent of total consumer finance receivables at June 30,
1997.

With respect to credit card receivables, approximately 65 percent of the
portfolio is within the corporation's 16-state banking region. Minnesota
represents approximately 13 percent of the total outstanding credit card
portfolio. No other state accounts for more than 10 percent of the
portfolio.

In general, the economy in regions of the U.S. where the corporation
primarily conducts operations continues to reflect modest growth. The
corporation's credit-risk management policies and activities as well as the
geographical diversification of the corporation's Banking Group (including
Norwest Card Services), Mortgage Banking, and Norwest Financial help
mitigate the credit risk in their respective portfolios.

Capital and Liquidity Management

The corporation's regulatory capital and ratios are summarized as follows:

June 30, December 31,
1997 1996

Tier 1 capital......................... $ 5,094 4,716
Tier 1 and Tier 2 capital.............. 6,097 5,692
Total risk adjusted assets............. 56,841 54,638
Tier 1 capital ratio................... 8.96% 8.63
Total capital to risk adjusted assets.. 10.73% 10.42
Leverage ratio......................... 6.33% 6.15

The corporation's Tier 1 capital, total capital to risk-adjusted assets and
leverage ratios exceed the regulatory minimums of 4.0 percent, 8.0 percent
and 3.0 percent, respectively.

The corporation's dividend payout ratio was 34.9 percent for the second
quarter of 1997 compared with 35.5 percent for the second quarter of 1996.

On June 23, 1997, the corporation's board of directors authorized the
corporation to repurchase up to an additional three million shares of the

<PAGE>

corporation's common stock, bringing the total common stock purchase
authority to approximately five million shares. The shares will be used to
meet the common stock issuance requirements of the corporation including
its Savings Investment Plan, stock option plans and other stock issuance
requirements other than acquisitions accounted for as pooling of interests.

RECENTLY ISSUED ACCOUNTING STANDARDS

In February 1997, the FASB issued Statement of Financial Accounting
Standards No. 128, "Earnings per Share," (FAS 128) which establishes new
standards for calculating and presenting earnings per share disclosures.
The corporation will be required to adopt the provisions of FAS 128 at
year-end 1997. Under FAS 128, basic and diluted earnings per share for the
quarters and six months ended June 30 were:

Quarter Six Months
In millions 1997 1996 1997 1996

Net income.................. $331.4 285.4 $653.3 556.8
Less dividends accrued
on preferred stock........ (4.4) (4.4) (8.9) (8.9)
Income available to common
stockholders.............. $327.0 281.0 644.4 547.9

Weighted average common
shares outstanding........ 374.6 366.2 373.7 361.8
Adjustments for dilutive
securities:
Assumed exercise of
outstanding stock options. 7.4 5.2 7.2 5.2
Diluted common shares....... 382.0 371.4 380.9 367.0

Earnings per common share:
Basic..................... $ 0.87 0.76 1.72 1.51
Diluted................... 0.86 0.76 1.69 1.49

Also in February 1997, the FASB issued Statement of Financial Accounting
Standards No. 129, "Disclosure of Information about Capital Structure,"
(FAS 129) which codifies existing disclosure requirements regarding capital
structure. FAS 129 will be required to be adopted at year-end 1997 and is
not expected to have a material impact on the corporation's current capital
structure disclosures.

In June 1997, the FASB issued Statement of Financial Accounting Standards
No. 130, "Reporting Comprehensive Income," (FAS 130) and Statement of
Financial Accounting Standards No. 131, "Disclosures about Segments of an
Enterprise and Related Information" (FAS 131). FAS 130 requires
disclosures of the components of comprehensive income and the accumulated
balance of other comprehensive income within total stockholders' equity.
FAS 131 requires disclosure of selected information about operating
segments including segment income, revenues and asset data. Operating
segments, as defined in FAS 131, would include those components for which
financial information is available and evaluated regularly by the chief
operating decision maker in assessing performance and making resource
allocation determinations for operating components such as those which
exceed 10 percent or more of combined revenue, income or assets. The
corporation will be required to adopt the provisions of FAS 130 and FAS 131
in 1998 and these standards are not expected to have a material impact on
the corporation's consolidated financial statements.

<PAGE>

Norwest Corporation and Subsidiaries
CONSOLIDATED AVERAGE BALANCE SHEETS AND RELATED YIELDS AND RATES
<TABLE>
<CAPTION>

Quarter Ended June 30,
In millions, except ratios 1997 1996
Interest Average Interest Average
Average Income/ Yields/ Average Income/ Yields/
Balance Expense* Rates* Balance Expense* Rates*
<S> <C> <C> <C> <C> <C> <C>
Assets

Money market investments .... $ 663 $ 9.4 5.64% $ 790 $ 10.0 5.14%
Trading account securities .. 591 11.1 7.48 498 8.2 6.66

Investment securities
available for sale
U.S. Treasury & federal
agencies ................ 3,854 64.4 6.63 1,214 19.8 6.52
State, municipal and
housing tax-exempt ...... 1,389 29.9 8.78 877 19.4 9.07
Mortgage-backed ........... 14,626 270.7 7.39 13,527 248.1 7.31
Other ..................... 1,068 9.6 5.17 1,209 12.0 6.13
Total investment
securities available
for sale ........... 20,937 374.6 7.26 16,827 299.3 7.29

Other securities held for
investment .............. 738 7.1 3.83 839 10.0 4.73

Total investment
securities ......... 21,675 381.7 7.14 17,666 309.3 7.16

Loans held for sale ......... 2,841 55.9 7.89 2,970 66.0 8.94
Mortgages held for sale ..... 5,391 97.8 7.26 7,160 133.3 7.45
Loans and leases
(net of unearned discount)
Commercial ................ 13,430 307.5 9.19 12,738 287.4 9.07
Real estate ............... 15,077 365.8 9.71 13,447 324.5 9.65
Consumer .................. 11,737 444.1 15.16 11,864 444.3 15.02
Total loans and leases .. 40,244 1,117.4 11.12 38,049 1,056.2 11.13
Allowance for credit losses (1,075) (991)
Net loans and leases .... 39,169 37,058

Total earning assets
(before the allowance for
credit losses) .......... 71,405 1,673.3 9.42 67,133 1,583.0 9.50

Cash and due from banks ..... 3,514 3,632
Other assets ................ 8,608 6,938
Total assets .............. $82,452 $76,712

(Continued on page 28)
</TABLE>

<PAGE>

Norwest Corporation and Subsidiaries
CONSOLIDATED AVERAGE BALANCE SHEETS AND RELATED YIELDS AND RATES

(Continued from page 27)
<TABLE>
<CAPTION>

Quarter Ended June 30,
In millions, except ratios 1997 1996
Interest Average Interest Average
Average Income/ Yields/ Average Income/ Yields/
Balance Expense* Rates* Balance Expense* Rates*

<S> <C> <C> <C> <C> <C> <C>
Liabilities and
Stockholders' Equity

Noninterest-bearing deposits. $13,460 $ - -% $11,926 $ - -%

Interest-bearing deposits
Savings and NOW accounts .. 9,552 39.4 1.65 5,907 26.0 1.77
Money market accounts ..... 10,619 83.7 3.16 11,933 86.9 2.93
Savings certificates ...... 13,082 176.8 5.42 12,336 166.7 5.44
Certificates of deposit
and other time .......... 3,440 48.6 5.68 2,772 39.0 5.66
Foreign time .............. 858 10.1 4.71 605 7.6 5.05
Total interest-bearing
deposits .............. 37,551 358.6 3.83 33,553 326.2 3.91
Federal funds purchased
repurchase agreements ..... 3,811 46.5 4.89 3,143 37.8 4.83
Short-term borrowings ....... 5,061 69.5 5.51 5,843 78.8 5.43
Long-term debt .............. 11,958 187.1 6.26 14,279 215.7 6.04

Total interest-bearing
liabilities ........... 58,381 661.7 4.54 56,818 658.5 4.65

Other liabilities ........... 4,339 2,393
Preferred stock ............. 187 188
Common stockholders' equity . 6,085 5,387
Total liabilities and
stockholders' equity .. $82,452 $76,712

Net interest income
(tax-equivalent basis) .. $ 1,011.6 $ 924.5

Yield spread .............. 4.88 4.85

Net interest margin ....... 5.69 5.54

Interest-bearing liabilities
to earning assets ....... 81.76 84.64

</TABLE>

<PAGE>

Norwest Corporation and Subsidiaries
CONSOLIDATED AVERAGE BALANCE SHEETS AND RELATED YIELDS AND RATES

<TABLE>
<CAPTION>
Six Months Ended June 30,
In millions, except ratios 1997 1996
Interest Average Interest Average
Average Income/ Yields/ Average Income/ Yields/
Balance Expense* Rates* Balance Expense* Rates*
Assets

<S> <C> <C> <C> <C> <C> <C>
Money market investments .... $ 1,138 $ 30.5 5.39% $ 674 $ 17.8 5.34%
Trading account securities .. 433 15.8 7.32 448 14.3 6.43

Investment securities
available for sale
U.S. Treasury & federal
agencies ................ 2,965 96.5 6.48 1,173 37.1 6.38
State, municipal and
housing tax-exempt ...... 1,202 51.5 8.80 858 37.8 9.14
Mortgage-backed ........... 14,446 535.0 7.43 12,930 473.2 7.36
Other ..................... 1,098 24.1 6.06 1,071 22.9 6.64
Total investment
securities available
for sale ........... 19,711 707.1 7.31 16,032 571.0 7.35

Other securities held for
investment .............. 729 14.1 3.86 818 18.9 4.61

Total investment
securities ......... 20,440 721.2 7.18 16,850 589.9 7.21

Loans held for sale ......... 2,882 112.1 7.84 3,205 153.2 9.61
Mortgages held for sale ..... 5,438 195.5 7.19 6,752 241.7 7.16
Loans and leases
(net of unearned discount)
Commercial ................ 13,371 604.7 9.12 12,512 567.3 9.11
Real estate ............... 15,025 723.6 9.66 13,266 647.5 9.76
Consumer .................. 11,700 886.2 15.20 11,756 882.8 15.05
Total loans and leases .. 40,096 2,214.5 11.10 37,534 2,097.6 11.20
Allowance for credit losses (1,067) (971)
Net loans and leases .... 39,029 36,563

Total earning assets
(before the allowance for
credit losses) .......... 70,427 3,289.6 9.42 65,463 3,114.5 9.61

Cash and due from banks ..... 3,580 3,592
Other assets ................ 8,381 6,423
Total assets .............. $81,321 $74,507

</TABLE>
(Continued on page 30)

<PAGE>

Norwest Corporation and Subsidiaries
CONSOLIDATED AVERAGE BALANCE SHEETS AND RELATED YIELDS AND RATES

(Continued from page 29)

Liabilities and
Stockholders' Equity

<S> <C> <C> <C> <C> <C> <C>
Noninterest-bearing deposits. $13,274 $ - -% $11,546 $ - -%

Interest-bearing deposits
Savings and NOW accounts .. 9,498 78.1 1.66 5,710 50.2 1.77
Money market accounts ..... 10,543 173.4 3.32 11,709 171.5 2.94
Savings certificates ...... 13,141 353.2 5.42 12,081 329.4 5.48
Certificates of deposit
and other time .......... 3,426 96.2 5.66 2,641 74.7 5.69
Foreign time .............. 650 13.8 4.29 422 10.4 4.95
Total interest-bearing
deposits .............. 37,258 714.7 3.87 32,563 636.2 3.93
Federal funds purchased
repurchase agreements ..... 3,152 76.4 4.89 3,156 78.9 5.02
Short-term borrowings ....... 5,157 138.7 5.42 5,472 148.5 5.46
Long-term debt .............. 12,337 381.0 6.18 13,984 428.1 6.12

Total interest-bearing
liabilities ........... 57,904 1,310.8 4.55 55,175 1,291.7 4.70

Other liabilities ........... 3,947 2,362
Preferred stock ............. 188 189
Common stockholders' equity . 6,008 5,235
Total liabilities and
stockholders' equity .. $81,321 $74,507

Net interest income
(tax-equivalent basis) .. $1,978.8 $1,822.8

Yield spread .............. 4.87 4.91

Net interest margin ....... 5.66 5.62

Interest-bearing liabilities
to earning assets ....... 82.22 84.28

</TABLE>

* Interest income and yields are calculated on a tax-equivalent basis using
a federal incremental tax rate of 35% in each period presented. Non-accrual
loans and the related negative income effect have been included in the
calculation of yields.

<PAGE>

PART II. OTHER INFORMATION

The annual meeting of stockholders of the corporation was held on April 22,
1997. There were 375,450,099 shares of common stock outstanding and entitled
to vote at said meeting; and a total 317,246,498 (84.5%) shares were present
at the meeting in person or by proxy. The stockholders voted to approve an
amendment to the corporation's Restated Certificate of Incorporation to
increase the authorized shares of common stock from 500,000,000 to
1,000,000,000 shares (291,320,965 for, 24,533,584 against, 1,391,949 abstained
and no broker non-votes) and ratified the appointment of KPMG Peat Marwick LLP
to audit the books of the corporation for the year ended 1997 (315,866,408
for, 535,498 against, 844,592 abstained and no broker non-votes). The
stockholders did not approve a proposal requesting the Board of Directors to
take steps to provide for cumulative voting in the election of directors
(78,015,001 for, 193,135,298 against, 13,832,968 abstained and 32,263,231
broker non-votes) and a proposal requesting the Board of Directors to develop
a fair lending policy for the corporation's financial subsidiaries (19,233,021
for, 255,438,688 against, 10,311,558 abstained, 32,263,231 broker non-votes).

In addition, 15 nominees were elected directors of the corporation, as
follows:

Shares FOR Shares WITHHELD

Leslie S. Biller 315,492,713 1,753,785
J.A. Blanchard III 315,489,993 1,756,505
David A. Christensen 315,640,109 1,606,389
Pierson M. Grieve 314,057,017 3,189,481
Charles M. Harper 315,348,317 1,898,181
William A. Hodder 314,103,439 3,143,059
Lloyd P. Johnson 315,548,344 1,698,154
Reatha Clark King 314,260,036 2,986,462
Richard M. Kovacevich 315,549,370 1,697,128
Richard S. Levitt 315,637,277 1,609,221
Richard D. McCormick 315,602,208 1,644,290
Cynthia H. Milligan 313,579,767 3,666,731
Benjamin F. Montoya 314,082,620 3,163,878
Ian M. Rolland 315,542,698 1,703,800
Michael W. Wright 314,235,374 3,011,124

<PAGE>

Item 6. Exhibits and Reports on Form 8-K.

(a) Exhibits.

The following exhibits are filed or incorporated by reference in
response to Item 601 of Regulation S-K.

Exhibit
No. Exhibit Page

3(a). Restated Certificate of Incorporation, as amended,
incorporated by reference to Exhibit 3(b) to the
corporation's Current Report on Form 8-K dated
June 28, 1993. Certificate of Amendment of
Certificate of Incorporation of the corporation
authorizing 4,000,000 shares of Preference Stock,
incorporated by reference to Exhibit 3 to the
corporation's Current Report on Form 8-K dated
July 3, 1995. Certificate of Amendment of Certificate
of Incorporation of the corporation increasing the
authorized number of common shares to one billion
shares, incorporated by reference to Exhibit 3 to the
corporation's Current Report on Form 8-K dated
June 3, 1997.

3(b). Certificate of Designations of powers, preferences and
rights relating to the corporation's ESOP Cumulative
Convertible Preferred Stock incorporated by reference
to Exhibit 4 to the corporation's Quarterly Report on
Form 10-Q for the quarter ended March 31, 1994.

3(c). Certificate of Designations of powers, preferences and
rights relating to the corporation's Cumulative Tracking
Preferred Stock incorporated by reference to Exhibit 3
to the corporation's Current Report on Form 8-K dated
January 9, 1995.

3(d). Certificate of Designations of powers, preferences and
rights relating to the corporation's 1995 ESOP Cumulative
Convertible Preferred Stock incorporated by reference to
Exhibit 4 to the corporation's Quarterly Report on
Form 10-Q for the quarter ended March 31, 1995.

3(e). Certificate Eliminating the Certificate of Designations
with respect to the Cumulative Convertible Preferred Stock,
Series B, incorporated by reference to Exhibit 3(a) to the
corporation's Current Report on Form 8-K dated
November 1, 1995.

3(f). Certificate Eliminating the Certificate of Designations
with respect to the 10.24% Cumulative Preferred Stock
incorporated by reference to Exhibit 3 to the corporation's
Current Report on Form 8-K dated February 20, 1996.

3(g). Certificate of Designations of powers, preferences and
rights relating to the corporation's 1996 ESOP Cumulative
Convertible Preferred Stock incorporated by reference to
Exhibit 3 to the corporation's Current Report on Form 8-K
dated February 26, 1996.

<PAGE>

Exhibit
No. Exhibit Page

3(h). Certificate of Designations of powers, preferences and
rights relating to the corporation's 1997 ESOP Cumulative
Convertible Preferred Stock incorporated by reference to
Exhibit 3 to the corporation's Current Report on Form 8-K
dated April 14, 1997.

3(i). By-Laws (as amended effective April 22, 1997), incorporated
by reference to Exhibit 3(i) to the corporation's Quarterly
Report on Form 10-Q dated March 31, 1997.

4(a). See 3(a) through 3(i) of this Item.

4(b). Rights Agreement dated as of November 22, 1988 between
the corporation and Citibank, N.A., incorporated by
reference to Exhibit 1 to the corporation's Form 8-A
dated November 6, 1988 and Certificates of Adjustment
pursuant to Section 16 of the Rights Agreement
incorporated by reference to Exhibit 3 to the
corporation's Form 8 dated July 21, 1989 and Exhibit 4
to the corporation's Form 8-A/A dated June 29, 1993.

4(c). Copies of instruments with respect to long-term debt
will be furnished to the Commission upon request.

11. Computation of Earnings Per Share 35

12(a). Computation of Ratio of Earnings to Fixed Charges. 37

12(b). Computation of Ratio of Earnings to Fixed Charges
and Preferred Stock Dividends. 38

Stockholders may obtain a copy of any Exhibit, upon payment of a reasonable
fee, by writing Norwest Corporation, Office of the Secretary, Norwest Center,
Sixth and Marquette, Minneapolis, Minnesota 55479-1026.

(b) Reports on Form 8-K.

The corporation filed a Current Report on Form 8-K, dated April 14, 1997,
reporting consolidated operating results of the corporation for the
quarter ended March 31, 1997, and filing the Certificate of Designations
relating to the corporation's 1997 ESOP Cumulative Convertible Preferred
Stock.

The corporation filed a Current Report on Form 8-K, dated June 3, 1997,
placing on file a Certificate of Amendment of Certificate of
Incorporation, as filed with the Delaware Secretary of State on
June 3, 1997, amending the corporation's Restated Certificate of
Incorporation to increase the corporation's authorized common stock from
500 million shares to one billion shares.

<PAGE>

SIGNATURES

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.

NORWEST CORPORATION

August 13, 1997 By /s/ Michael A. Graf
Senior Vice President
and Controller
(Chief Accounting Officer)

<PAGE>

Exhibit 11.

Norwest Corporation and Subsidiaries
COMPUTATION OF EARNINGS PER SHARE
(Unaudited)

In thousands, except per common share amounts Quarter Ended
June 30,
1997 1996
PRIMARY:
Weighted average number of common shares
outstanding ..................................... 374,569 366,170
Net effect of assumed exercise of stock options
based on treasury stock method using average
market price .................................... 5,128 3,452
379,697 369,622

Net income ........................................ $331,391 285,406
Less dividends accrued on preferred stock ........ 4,440 4,440
Net income, as adjusted .......................... $326,951 280,966

Net income per common share ...................... $ 0.86 0.76

FULLY DILUTED:
Weighted average number of common shares
outstanding ..................................... 374,569 366,170
Net effect of assumed exercise of stock options
based on treasury stock method using average
market price or period-end market price,
whichever is higher ............................. 5,583 3,452
Assumed conversion of 6 3/4% convertible
subordinated debentures due 2003 ................ 18 18
380,170 369,640

Net income ........................................ $331,391 285,406
Less dividends accrued on preferred stock ........ 4,440 4,440
Add 6 3/4% convertible subordinated debentures
interest and amortization of debt expense,
net of income tax effect ........................ 1 1
Net income, as adjusted .......................... $326,952 280,967

Net income per common share....................... $ 0.86 0.76

<PAGE>

Exhibit 11.
(continued)

Norwest Corporation and Subsidiaries
COMPUTATION OF EARNINGS PER SHARE
(Unaudited)

In thousands, except per common share amounts Six Months Ended
June 30,
1997 1996
PRIMARY:
Weighted average number of common shares
outstanding ..................................... 373,683 361,781
Net effect of assumed exercise of stock options
based on treasury stock method using average
market price .................................... 5,144 3,461
378,827 365,242

Net income ........................................ $653,252 556,788
Less dividends accrued on preferred stock ........ 8,881 8,881
Net income, as adjusted .......................... $644,371 547,907

Net income per common share ...................... $ 1.70 1.50

FULLY DILUTED:
Weighted average number of common shares
outstanding ..................................... 373,683 361,781
Net effect of assumed exercise of stock options
based on treasury stock method using average
market price or period-end market price,
whichever is higher ............................. 5,804 3,461
Assumed conversion of 6 3/4% convertible
subordinated debentures due 2003................. 18 18
379,505 365,260

Net income ........................................ $653,252 556,788
Less dividends accrued on preferred stock ........ 8,881 8,881
Add 6 3/4% convertible subordinated debentures
interest and amortization of debt expense,
net of income tax effect ........................ 2 2
Net income, as adjusted .......................... $644,373 547,909

Net income per common share....................... $ 1.70 1.50

<PAGE>

Exhibit 12(a).

Norwest Corporation and Subsidiaries
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Unaudited)

<TABLE>
<CAPTION>
Six Months Ended
June 30, Year Ended December 31,
In thousands 1997 1996 1996 1995 1994 1993 1992

<S> <C> <C> <C> <C> <C> <C> <C>
Computation of Income:
Income before
income taxes $1,006,075 872,440 1,781,509 1,422,814 1,180,601 879,755 645,568
Capitalized interest - (14) (14) (112) (69) (65) (24)
Income before income
taxes and capitalized
interest 1,006,075 872,426 1,781,495 1,422,702 1,180,532 879,690 645,544
Fixed charges 1,345,026 1,324,291 2,685,447 2,503,603 1,640,049 1,485,936 1,651,664
Total income for
computation $2,351,101 2,196,717 4,466,942 3,926,305 2,820,581 2,365,626 2,297,208
Total income for
computation excluding
interest on deposits
from fixed charges $1,636,410 1,560,544 3,142,024 2,770,005 1,957,224 1,513,317 1,281,619

Computation of Fixed
Charges:
Net rental
expense (a) $ 102,730 97,868 205,409 166,591 149,462 128,573 123,342
Portion of rentals
deemed
representative
of interest $ 34,243 32,623 68,470 55,530 49,821 42,858 41,114
Interest:
Interest on
deposits 714,691 636,173 1,324,918 1,156,300 863,357 852,309 1,015,589
Interest on
federal funds
and other
short-term
borrowings 215,131 227,329 454,013 515,646 290,211 238,046 277,835
Interest on
long-term debt 380,961 428,152 838,032 776,015 436,591 352,658 317,102
Capitalized
interest - 14 14 112 69 65 24
Total interest 1,310,783 1,291,668 2,616,977 2,448,073 1,590,228 1,443,078 1,610,550
Total fixed
charges $1,345,026 1,324,291 2,685,447 2,503,603 1,640,049 1,485,936 1,651,664
Total fixed
charges excluding
interest on
deposits $ 630,335 688,118 1,360,529 1,347,303 776,692 633,627 636,075
Ratio of Income
to Fixed Charges:
Excluding
interest on
deposits 2.60x 2.27 2.31 2.06 2.52 2.39 2.01
Including
interest on
deposits 1.75x 1.66 1.66 1.57 1.72 1.59 1.39

(a) Includes equipment rentals.
</TABLE>
37

<PAGE>

Exhibit 12(b).

Norwest Corporation and Subsidiaries
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
(Unaudited)
<TABLE>
<CAPTION>

Six Months Ended
June 30, Year Ended December 31,
In thousands 1997 1996 1996 1995 1994 1993 1992

Computation of Fixed
Charges:
Net rental
expense (a) $ 102,730 97,868 205,409 166,591 149,462 128,573 123,342
Portion of rentals
deemed
representative
of interest $ 34,243 32,623 68,470 55,530 49,821 42,858 41,114
Interest:
Interest on
deposits 714,691 636,173 1,324,918 1,156,300 863,357 852,309 1,015,589
Interest on
federal funds
and other
short-term
borrowings 215,131 227,329 454,013 515,646 290,211 238,046 277,835
Interest on
long-term debt 380,961 428,152 838,032 776,015 436,591 352,658 317,102
Capitalized
interest - 14 14 112 69 65 24
Total interest 1,310,783 1,291,668 2,616,977 2,448,073 1,590,228 1,443,078 1,610,550
Total fixed
charges $1,345,026 1,324,291 2,685,447 2,503,603 1,640,049 1,485,936 1,651,664
Total fixed
charges excluding
interest on
deposits $ 630,335 688,118 1,360,529 1,347,303 776,692 633,627 636,075
Preferred stock
dividends 8,881 8,881 17,763 41,220 27,827 31,170 32,219
Pre-tax earnings
needed to meet
preferred stock
dividend
requirements 13,678 13,916 27,424 61,349 41,044 44,728 44,367
Total combined fixed
charges and preferred
stock dividends $1,358,704 1,338,207 2,712,871 2,564,952 1,681,093 1,530,664 1,696,031
Total combined
fixed charges
and preferred stock
dividends excluding
interest on
deposits $ 644,013 702,034 1,387,953 1,408,652 817,736 678,355 680,442

(a) Includes equipment rentals.
</TABLE>

<PAGE>

Exhibit 12(b).
(continued)

Norwest Corporation and Subsidiaries
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
(Unaudited)
<TABLE>
<CAPTION>

Six Months Ended
June 30, Year Ended December 31,
In thousands 1997 1996 1996 1995 1994 1993 1992
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of Income to Combined
Fixed Charges and Preferred
Stock Dividends:
Excluding interest on
deposits 2.54x 2.22 2.26 1.97 2.39 2.23 1.88
Including interest on
deposits 1.73x 1.64 1.65 1.53 1.68 1.55 1.35

</TABLE>

<PAGE>

<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
JUNE 30, 1997 QUARTERLY REPORT ON FORM 10-Q AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1000000

<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 4038
<INT-BEARING-DEPOSITS> 26
<FED-FUNDS-SOLD> 453
<TRADING-ASSETS> 1503
<INVESTMENTS-HELD-FOR-SALE> 19627
<INVESTMENTS-CARRYING> 737
<INVESTMENTS-MARKET> 762
<LOANS> 40784
<ALLOWANCE> 1071
<TOTAL-ASSETS> 83856
<DEPOSITS> 51971
<SHORT-TERM> 9480
<LIABILITIES-OTHER> 3854
<LONG-TERM> 12044
0
188
<COMMON> 635
<OTHER-SE> 5684
<TOTAL-LIABILITIES-AND-EQUITY> 83856
<INTEREST-LOAN> 2211
<INTEREST-INVEST> 704
<INTEREST-OTHER> 354
<INTEREST-TOTAL> 3269
<INTEREST-DEPOSIT> 715
<INTEREST-EXPENSE> 1311
<INTEREST-INCOME-NET> 1958
<LOAN-LOSSES> 232
<SECURITIES-GAINS> 5
<EXPENSE-OTHER> 2161
<INCOME-PRETAX> 1006
<INCOME-PRE-EXTRAORDINARY> 653
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 653
<EPS-PRIMARY> 1.70
<EPS-DILUTED> 1.70
<YIELD-ACTUAL> 5.66
<LOANS-NON> 188
<LOANS-PAST> 115
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 1041
<CHARGE-OFFS> 304
<RECOVERIES> 77
<ALLOWANCE-CLOSE> 1071
<ALLOWANCE-DOMESTIC> 672
<ALLOWANCE-FOREIGN> 35
<ALLOWANCE-UNALLOCATED> 364

</TABLE>