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Previous: NASHUA CORP, DEFA14A, 2000-04-18 |
Next: OHIO ART CO, 8-K, 2000-04-18 |
<PAGE>
UNITED STATES
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 18, 2000
WELLS FARGO & COMPANY
(Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
<S> <C> <C>
Delaware 001-2979 No.41-0449260
(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Identification No.)
</TABLE>
420 Montgomery Street, San Francisco, California 94163
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 1-800-411-4932
Not applicable
(Former name or former address, if changed since last report)
<PAGE>
Item 5: Other Events
------------
Wells Fargo & Company is placing on file as Exhibit 99 a copy of the
Company's financial results for the quarter ended March 31, 2000.
Final financial statements with additional analyses will be filed
as part of the Company's Form 10-Q for the quarter ended March 31,
2000.
Item 7: Financial Statements and Exhibits
---------------------------------
(c) Exhibits
27 Financial Data Schedule
99 Wells Fargo & Company's financial results for the quarter
ended March 31, 2000
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 18, 2000.
WELLS FARGO & COMPANY
By: LES L. QUOCK
------------------------------------
Les L. Quock
Senior Vice President and Controller
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE 8-K FOR
THE PERIOD ENDED MARCH 31, 2000 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL INFORMATION.
</LEGEND>
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 12,096
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 3,066
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 36,774
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 124,846
<ALLOWANCE> 3,237
<TOTAL-ASSETS> 222,276
<DEPOSITS> 141,467
<SHORT-TERM> 21,334
<LIABILITIES-OTHER> 10,293
<LONG-TERM> 25,553
0
263
<COMMON> 2,777
<OTHER-SE> 20,589
<TOTAL-LIABILITIES-AND-EQUITY> 222,276
<INTEREST-LOAN> 2,983
<INTEREST-INVEST> 631
<INTEREST-OTHER> 349
<INTEREST-TOTAL> 3,963
<INTEREST-DEPOSIT> 757
<INTEREST-EXPENSE> 1,523
<INTEREST-INCOME-NET> 2,440
<LOAN-LOSSES> 255
<SECURITIES-GAINS> (602)
<EXPENSE-OTHER> 2,479
<INCOME-PRETAX> 1,617
<INCOME-PRE-EXTRAORDINARY> 1,010
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,010
<EPS-BASIC> 0.62
<EPS-DILUTED> 0.61
<YIELD-ACTUAL> 5.56
<LOANS-NON> 743
<LOANS-PAST> 0
<LOANS-TROUBLED> 1
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 3,170
<CHARGE-OFFS> 372
<RECOVERIES> 118
<ALLOWANCE-CLOSE> 3,237
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
<PAGE>
Wells Fargo & Company's financial results for the quarter ended March 31, 2000
Wells Fargo & Company reported net income of $1,010 million for the
first quarter of 2000, an increase of 14 percent from $884 million in the
first quarter of 1999. Diluted earnings per common share were $.61 for the
first quarter of 2000, an increase of 15 percent from $.53 in the first
quarter of 1999. Return on average assets (ROA) was 1.88 percent for the
first quarter of 2000, compared with 1.80 percent for the first quarter of
1999. Return on average common equity (ROE) was 18.24 percent for the first
quarter of 2000, compared with 17.33 percent for the first quarter of 1999.
Diluted cash earnings per share were $.70 for the first quarter of
2000, an increase of 15 percent from $.61 per share for the same period of 1999.
Cash earnings are earnings before the amortization of goodwill and nonqualifying
core deposit intangible. Cash ROA was 2.23 percent and cash ROE was 34.15
percent for the first quarter of 2000, compared with 2.17 percent and 34.38
percent, respectively, for the first quarter of 1999.
Net interest income on a taxable-equivalent basis was $2,456 million in
the first quarter of 2000, compared with $2,281 million for the same quarter a
year ago. The net interest margin was 5.56 percent for the first quarter of
2000, compared with 5.58 percent for the same period of 1999.
Noninterest income in the first quarter of 2000 was $1,911 million, an
increase of 11 percent from $1,727 million in the same quarter of 1999. The
increase was primarily due to net venture capital gains of $885 million, offset
by losses of $602 million on the sales of securities that resulted from the
continued restructuring of the securities available for sale portfolio and a
$160 million write-down of auto lease residuals.
Noninterest expense was $2,479 million in the first quarter of 2000, an
increase of 6 percent from $2,342 million in the same quarter of 1999. The
efficiency ratio improved to 57.0 percent for the first quarter of 2000,
compared with 58.7 percent for the same quarter of 1999. On a cash basis, this
ratio improved to 53.4 percent, compared with 54.9 percent for the same quarter
of 1999.
The provision for loan losses was $255 million for the first quarter of
2000, compared with $270 million for the same period in 1999. Net charge-offs
totaled $254 million, or .84 percent of average loans (annualized), in the first
quarter of 2000, compared with $273 million, or 1.03 percent of average loans
(annualized), for the first quarter of 1999.
<PAGE>
-2-
At March 31, 2000, the allowance for loan losses of $3,237 million was
2.59 percent of total loans, compared with 2.65 percent at December 31, 1999 and
2.92 percent at March 31, 1999. Total nonaccrual and restructured loans were
$744 million at March 31, 2000, compared with $669 million at December 31, 1999
and $704 million at March 31, 1999.
WELLS FARGO & COMPANY IS A DIVERSIFIED FINANCIAL SERVICES COMPANY WITH
$222 BILLION IN ASSETS, PROVIDING BANKING, INSURANCE, INVESTMENTS, MORTGAGE AND
CONSUMER FINANCE FROM ABOUT 5,300 STORES AND THE INTERNET (WELLSFARGO.COM)
ACROSS NORTH AMERICA AND ELSEWHERE INTERNATIONALLY.
- ----------------
The following appears in accordance with the Private Securities Litigation
Reform Act of 1995:
This discussion of financial results may contain forward-looking statements
about the Company, including descriptions of plans or objectives of its
management for future operations, products or services, and forecasts of its
revenues, earnings or other measures of economic performance. Forward-looking
statements can be identified by the fact that they do not relate strictly to
historical or current facts. They often include the words "believe," "expect,"
"anticipate," "intend," "plan," "estimate" or words of similar meaning, or
future or conditional verbs such as "will," "would," "should," "could" or "may."
Forward-looking statements, by their nature, are subject to risks and
uncertainties. A number of factors--many of which are beyond the Company's
control--could cause actual conditions, events or results to differ
significantly from those described in the forward-looking statements. The
Company's reports filed with the Securities and Exchange Commission, including
the Company's Form 10-K for the year ended December 31, 1999, describe some of
these factors, including certain credit, market, operational, liquidity and
interest rate risks associated with the Company's business and operations. Other
factors described in the Company's December 31, 1999 Form 10-K include changes
in business and economic conditions, competition, fiscal and monetary policies,
disintermediation, legislation including the Gramm-Leach-Bliley Act of 1999, the
combination of the former Norwest Corporation and the former Wells Fargo &
Company, and other mergers and acquisitions.
Forward-looking statements speak only as of the date they are made. The Company
does not undertake to update forward-looking statements to reflect circumstances
or events that occur after the date the forward-looking statements are made.
<PAGE>
3
Wells Fargo & Company and Subsidiaries
SUMMARY FINANCIAL DATA
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
% Change
Quarter ended Mar. 31, 2000 from
------------------------------- ------------------
MAR. 31, Dec. 31, Mar. 31, Dec. 31, Mar. 31,
(in millions, except per share amounts) 2000 1999 1999 1999 1999
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
FOR THE PERIOD
Net income $ 1,010 $ 970 $ 884 4% 14%
Net income applicable to common stock 1,006 961 875 5 15
Earnings per common share $ .62 $ .59 $ .53 5 17
Diluted earnings per common share .61 .58 .53 5 15
Dividends declared per common share .22 .20 .185 10 19
Average common shares outstanding 1,627.1 1,635.6 1,647.1 (1) (1)
Diluted common shares outstanding 1,640.2 1,656.0 1,664.2 (1) (1)
Profitability ratios (annualized)
Net income to average total assets (ROA) 1.88% 1.85% 1.80% 2 4
Net income applicable to common stock to
average common stockholders' equity (ROE) 18.24 17.84 17.33 2 5
Total revenue $ 4,351 $ 4,466 $ 3,993 (3) 9
Efficiency ratio (1) 57.0% 59.5% 58.7% (4) (3)
Average loans $121,172 $116,301 $107,834 4 12
Average assets 216,458 208,347 198,723 4 9
Average core deposits 127,410 126,493 128,133 1 (1)
Net interest margin 5.56% 5.61% 5.58% (1) --
NET INCOME AND RATIOS EXCLUDING
GOODWILL AND NONQUALIFYING CORE DEPOSIT
INTANGIBLE AMORTIZATION AND BALANCES
("CASH") (2)
Net income applicable to common stock $ 1,145 $ 1,120 $ 1,008 2 14
Earnings per common share .70 .68 .61 3 15
Diluted earnings per common share .70 .68 .61 3 15
ROA 2.23% 2.24% 2.17% -- 3
ROE 34.15 34.20 34.38 -- (1)
Efficiency ratio 53.4 55.6 54.9 (4) (3)
AT PERIOD END
Securities available for sale $ 36,774 $ 38,518 $ 35,801 (5) 3
Loans 124,846 119,464 108,108 5 15
Allowance for loan losses 3,237 3,170 3,161 2 2
Goodwill 8,355 7,702 7,747 8 8
Assets 222,276 218,102 201,430 2 10
Core deposits 132,480 126,198 127,996 5 4
Common stockholders' equity 23,366 21,860 20,817 7 12
Stockholders' equity 23,629 22,131 21,276 7 11
Capital ratios
Common stockholders' equity to assets 10.51% 10.02% 10.33% 5 2
Stockholders' equity to assets 10.63 10.15 10.56 5 1
Risk-based capital (3)
Tier 1 capital 7.60 8.07 8.23 (6) (8)
Total capital 10.40 10.50 10.97 (1) (5)
Leverage (3) 6.50 6.77 6.74 (4) (4)
Book value per common share $ 14.35 $ 13.44 $ 12.60 7 14
Staff (active, full-time equivalent) 90,683 89,355 90,711 1 --
COMMON STOCK PRICE
High $ 43.75 $ 49.94 $ 40.44 (12) 8
Low 31.00 38.38 32.13 (19) (4)
Period end 40.75 40.44 35.06 1 16
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The efficiency ratio is defined as noninterest expense divided by total
revenue (net interest income and noninterest income).
(2) Nonqualifying core deposit intangible (CDI) amortization and average
balance excluded from these calculations are, with the exception of the
efficiency and ROA ratios, net of applicable taxes. The pretax amount for
the average balance of nonqualifying CDI was $1,215 million for the quarter
ended March 31, 2000. The after-tax amounts for the amortization and
average balance of nonqualifying CDI were $26 million and $753 million,
respectively, for the quarter ended March 31, 2000. Goodwill amortization
and average balance (which are not tax effected) were $113 million and
$7,932 million, respectively, for the quarter ended March 31, 2000.
(3) The March 31, 2000 ratios are preliminary.
<PAGE>
4
Wells Fargo & Company and Subsidiaries
CONSOLIDATED STATEMENT OF INCOME
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
Quarter ended March 31,
------------------------ %
(in millions, except per share amounts) 2000 1999 Change
- -------------------------------------------------------------------------------------------------------------------
INTEREST INCOME
<S> <C> <C> <C>
Securities available for sale $ 631 $ 510 24%
Mortgages held for sale 170 258 (34)
Loans held for sale 107 99 8
Loans 2,983 2,579 16
Other interest income 72 42 71
-------- --------
Total interest income 3,963 3,488 14
-------- --------
INTEREST EXPENSE
Deposits 757 717 6
Short-term borrowings 370 208 78
Long-term debt 381 283 35
Guaranteed preferred beneficial interests
in Company's subordinated debentures 15 14 7
-------- --------
Total interest expense 1,523 1,222 25
-------- --------
NET INTEREST INCOME 2,440 2,266 8
Provision for loan losses 255 270 (6)
-------- --------
Net interest income after
provision for loan losses 2,185 1,996 9
-------- --------
NONINTEREST INCOME
Service charges on deposit accounts 383 344 11
Trust and investment fees 360 300 20
Credit card fees 123 132 (7)
Other fees 270 238 13
Mortgage banking 306 327 (6)
Insurance 92 85 8
Net venture capital gains 885 112 690
Net losses on securities available for sale (602) (2) --
Other 94 191 (51)
-------- --------
Total noninterest income 1,911 1,727 11
-------- --------
NONINTEREST EXPENSE
Salaries 818 725 13
Incentive compensation 134 134 --
Employee benefits 233 199 17
Equipment 193 191 1
Net occupancy 224 186 20
Goodwill 113 104 9
Core deposit intangible 47 52 (10)
Net (gains) losses on dispositions of premises
and equipment (33) 2 --
Other 750 749 --
-------- --------
Total noninterest expense 2,479 2,342 6
-------- --------
INCOME BEFORE INCOME TAX EXPENSE 1,617 1,381 17
Income tax expense 607 497 22
-------- --------
NET INCOME $ 1,010 $ 884 14%
======== ========
NET INCOME APPLICABLE TO
COMMON STOCK $ 1,006 $ 875 15%
======== ========
EARNINGS PER COMMON SHARE $ .62 $ .53 17%
======== ========
DILUTED EARNINGS PER COMMON SHARE $ .61 $ .53 15%
======== ========
DIVIDENDS DECLARED PER COMMON SHARE $ .22 $ .185 19%
======== ========
Average common shares outstanding 1,627.1 1,647.1 (1)%
======== ========
Diluted average common shares outstanding 1,640.2 1,664.2 (1)%
======== ======== =====
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
5
Wells Fargo & Company and Subsidiaries
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
% Change
March 31, 2000 From
---------------------------------- -------------------
MAR. 31, Dec. 31, Mar. 31, Dec. 31, Mar. 31,
(in millions, except shares) 2000 1999 1999 1999 1999
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ASSETS
Cash and due from banks $ 12,096 $ 13,250 $ 11,364 (9)% 6%
Federal funds sold and securities
purchased under resale agreements 3,066 1,554 869 97 253
Securities available for sale 36,774 38,518 35,801 (5) 3
Mortgages held for sale 6,324 11,707 11,717 (46) (46)
Loans held for sale 5,496 4,975 5,630 10 (2)
Loans 124,846 119,464 108,108 5 15
Allowance for loan losses 3,237 3,170 3,161 2 2
-------- -------- --------
Net loans 121,609 116,294 104,947 5 16
-------- -------- --------
Mortgage servicing rights 4,625 4,483 3,627 3 28
Premises and equipment, net 2,906 2,985 3,130 (3) (7)
Core deposit intangible 1,250 1,286 1,437 (3) (13)
Goodwill 8,355 7,702 7,747 8 8
Interest receivable and other assets 19,775 15,348 15,161 29 30
-------- -------- --------
Total assets $222,276 $218,102 $201,430 2% 10%
======== ======== ======== ==== ====
LIABILITIES
Noninterest-bearing deposits $ 45,836 $ 42,916 $ 42,322 7% 8%
Interest-bearing deposits 95,631 89,792 90,018 7 6
-------- -------- --------
Total deposits 141,467 132,708 132,340 7 7
Short-term borrowings 21,334 27,995 17,270 (24) 24
Accrued expenses and other liabilities 10,293 11,108 9,396 (7) 10
Long-term debt 24,768 23,375 20,363 6 22
Guaranteed preferred beneficial interests
in Company's subordinated debentures 785 785 785 -- --
STOCKHOLDERS' EQUITY
Preferred stock 473 344 604 38 (22)
Unearned ESOP shares (210) (73) (145) 188 45
-------- -------- --------
Total preferred stock 263 271 459 (3) (43)
Common stock - $1-2/3 par value,
authorized 4,000,000,000 shares;
issued 1,666,095,265 shares, 1,666,095,265 shares
and 1,666,095,285 shares 2,777 2,777 2,777 -- --
Additional paid-in capital 8,789 8,786 8,733 -- 1
Retained earnings 11,706 11,196 9,525 5 23
Cumulative other comprehensive income 1,723 892 307 93 461
Note receivable from ESOP (1) (1) (3) -- (67)
Treasury stock - 37,415,264 shares,
39,245,724 shares and 13,478,919 shares (1,628) (1,790) (522) (9) 212
-------- -------- --------
Total stockholders' equity 23,629 22,131 21,276 7 11
-------- -------- --------
Total liabilities and stockholders' equity $222,276 $218,102 $201,430 2% 10%
======== ======== ========= ==== ===
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
6
Wells Fargo & Company and Subsidiaries
CONDENSED CONSOLIDATED STATEMENT OF
CHANGES IN STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
Quarter ended March 31,
------------------------
(in millions) 2000 1999
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
BALANCE, BEGINNING OF PERIOD $22,131 $20,759
Net income 1,010 884
Other comprehensive income (loss), net of tax:
Change in foreign currency translation adjustments -- 1
Change in investment securities valuation allowance 831 (157)
Common stock issued 83 242
Common stock issued for acquisitions 1,125 63
Common stock repurchased (1,229) (221)
Preferred stock released to ESOP 40 18
Preferred stock dividends (4) (9)
Common stock dividends (359) (304)
Increase in Rabbi trust assets (classified as treasury stock) 1 --
------- -------
BALANCE, END OF PERIOD $23,629 $21,276
======= =======
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
LOANS
- -------------------------------------------------------------------------------------------------------------------
MAR. 31, Dec. 31, Mar. 31,
(in millions) 2000 1999 1999
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Commercial $ 40,907 $ 38,688 $ 35,232
Real estate 1-4 family first mortgage 13,934 12,398 12,186
Other real estate mortgage 20,310 19,178 16,903
Real estate construction 4,906 4,711 3,942
Consumer:
Real estate 1-4 family junior lien mortgage 13,815 12,938 10,987
Credit card 5,207 5,472 5,394
Other revolving credit and monthly payment 16,634 16,656 15,333
-------- -------- --------
Total consumer 35,656 35,066 31,714
Lease financing 7,530 7,850 6,645
Foreign 1,603 1,573 1,486
-------- -------- --------
Total loans (net of unearned discount) $124,846 $119,464 $108,108
======== ======== ========
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
7
Wells Fargo & Company and Subsidiaries
CHANGES IN THE ALLOWANCE FOR LOAN LOSSES
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
Quarter ended
------------------------------------------
MAR. 31, Dec. 31, Mar. 31,
(in millions) 2000 1999 1999
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
BALANCE, BEGINNING OF QUARTER $3,170 $3,167 $3,134
Allowance related to business combinations, net 66 2 30
Provision for loan losses 255 275 270
Loan charge-offs:
Commercial (101) (97) (81)
Real estate 1-4 family first mortgage (6) (2) (1)
Other real estate mortgage (3) (8) (8)
Real estate construction (1) (1) --
Consumer:
Real estate 1-4 family junior lien mortgage (11) (11) (9)
Credit card (82) (89) (110)
Other revolving credit and monthly payment (131) (154) (127)
------ ------ ------
Total consumer (224) (254) (246)
Lease financing (13) (8) (11)
Foreign (24) (21) (15)
------ ------ ------
Total loan charge-offs (372) (391) (362)
------ ------ ------
Loan recoveries:
Commercial 32 25 13
Real estate 1-4 family first mortgage 1 -- 1
Other real estate mortgage 3 4 17
Real estate construction 1 1 --
Consumer:
Real estate 1-4 family junior lien mortgage 4 5 3
Credit card 9 10 13
Other revolving credit and monthly payment 49 65 36
------ ------ ------
Total consumer 62 80 52
Lease financing 3 3 3
Foreign 16 4 3
------ ------ ------
Total loan recoveries 118 117 89
------ ------ ------
Total net loan charge-offs (254) (274) (273)
------ ------ ------
BALANCE, END OF QUARTER $3,237 $3,170 $3,161
====== ====== ======
Total net loan charge-offs as a percentage
of average total loans (annualized) .84% .93% 1.03%
====== ====== ======
Allowance as a percentage of total loans 2.59% 2.65% 2.92%
====== ====== ======
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
8
Wells Fargo & Company and Subsidiaries
NONACCRUAL AND RESTRUCTURED LOANS AND OTHER ASSETS
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
MAR. 31, Dec. 31, Mar. 31,
(in millions) 2000 1999 1999
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Nonaccrual loans:
Commercial $423 $344 $333
Real estate 1-4 family first mortgage 119 127 135
Other real estate mortgage 106 112 127
Real estate construction 16 7 18
Consumer:
Real estate 1-4 family junior lien mortgage 11 17 18
Other revolving credit and monthly payment 23 27 35
---- ---- ----
Total consumer 34 44 53
Lease financing 34 22 15
Foreign 11 9 22
---- ---- ----
Total nonaccrual loans 743 665 703
Restructured loans 1 4 1
---- ---- ----
Nonaccrual and restructured loans 744 669 704
As a percentage of total loans .6% .6% .7%
Foreclosed assets 143 153 187
Real estate investments (1) 32 33 1
---- ---- ----
Total nonaccrual and restructured loans
and other assets $919 $855 $892
==== ==== ====
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Represents the amount of real estate investments (contingent interest loans
accounted for as investments) that would be classified as nonaccrual if
such assets were recorded as loans. Real estate investments totaled $85
million, $89 million and $130 million at March 31, 2000, December 31, 1999
and March 31, 1999, respectively.
<PAGE>
9
Wells Fargo & Company and Subsidiaries
NONINTEREST INCOME
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
Quarter ended March 31,
-------------------------- %
(in millions) 2000 1999 Change
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Service charges on deposit accounts $ 383 $ 344 11%
Trust and investment fees:
Asset management and custody fees 167 184 (9)
Mutual fund and annuity sales fees 162 90 80
All other 31 26 19
------ ------
Total trust and investment fees 360 300 20
Credit card fees 123 132 (7)
Other fees:
Cash network fees 70 58 21
Charges and fees on loans 81 76 7
All other 119 104 14
------ ------
Total other fees 270 238 13
Mortgage banking:
Origination and other closing fees 61 113 (46)
Servicing fees, net of amortization 151 (45) --
Net gains on sales of mortgages 56 200 (72)
All other 38 59 (36)
------ ------
Total mortgage banking 306 327 (6)
Insurance 92 85 8
Net venture capital gains 885 112 690
Net losses on securities available for sale (602) (2) --
Income from equity investments accounted
for by the:
Cost method 114 33 245
Equity method 38 21 81
Net gains on sales of loans 3 13 (77)
Net gains (losses) on dispositions of operations 2 (1) --
All other (63) 125 --
------ ------
Total $1,911 $1,727 11%
====== ====== ===
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
NONINTEREST EXPENSE
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
Quarter ended March 31,
-------------------------- %
(in millions) 2000 1999 Change
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Salaries $ 818 $ 725 13%
Incentive compensation 134 134 --
Employee benefits 233 199 17
Equipment 193 191 1
Net occupancy 224 186 20
Goodwill 113 104 9
Core deposit intangible:
Nonqualifying (1) 42 46 (9)
Qualifying 5 6 (17)
Net (gains) losses on dispositions of premises
and equipment (33) 2 --
Contract services 107 90 19
Outside professional services 87 73 19
Outside data processing 71 76 (7)
Telecommunications 62 61 2
Travel and entertainment 55 55 --
Advertising and promotion 58 50 16
Postage 56 57 (2)
Stationery and supplies 46 39 18
Insurance 42 36 17
Operating losses 35 29 21
Security 21 21 --
All other 110 162 (32)
----- ------
Total $2,479 $2,342 6%
====== ====== ===
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Amortization of core deposit intangible acquired after February 1992 that
is subtracted from stockholders' equity in computing regulatory capital for
bank holding companies.
<PAGE>
10
Wells Fargo & Company and Subsidiaries
AVERAGE BALANCES, YIELDS AND RATES PAID (TAXABLE-EQUIVALENT BASIS) (1)(2)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
Quarter ended March 31,
-------------------------------------------------------------------
2000 1999
------------------------------ ------------------------------
INTEREST Interest
AVERAGE YIELDS/ INCOME/ Average Yields/ income/
(in millions) BALANCE RATES EXPENSE balance rates expense
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
EARNING ASSETS
Federal funds sold and securities purchased
under resale agreements $ 1,951 5.50% $ 27 $ 1,160 5.01% $ 14
Securities available for sale (3):
Securities of U.S. Treasury and federal agencies 4,295 5.73 65 4,716 5.63 65
Securities of U.S. states and political subdivisions 1,826 8.13 38 1,686 8.30 33
Mortgage-backed securities:
Federal agencies 23,808 7.30 443 19,655 6.72 326
Private collateralized mortgage obligations 2,168 7.21 41 3,308 6.75 56
-------- ------ -------- ------
Total mortgage-backed securities 25,976 7.29 484 22,963 6.72 382
Other securities 5,969 6.63 57 2,843 6.07 42
-------- ------ -------- ------
Total securities available for sale 38,066 7.08 644 32,208 6.58 522
Loans held for sale (3) 5,303 8.08 107 5,561 7.24 99
Mortgages held for sale (3) 8,888 7.56 170 15,407 6.71 258
Loans:
Commercial 39,222 9.16 893 34,875 8.53 735
Real estate 1-4 family first mortgage 12,694 7.83 248 12,089 7.61 231
Other real estate mortgage 19,624 9.27 453 16,731 9.03 373
Real estate construction 4,843 9.38 113 3,902 9.36 90
Consumer:
Real estate 1-4 family junior lien mortgage 13,315 10.19 338 10,972 9.89 268
Credit card 5,293 13.70 181 5,549 13.64 189
Other revolving credit and monthly payment 16,770 12.48 523 15,669 12.52 489
-------- ------ -------- ------
Total consumer 35,378 11.80 1,042 32,190 11.81 946
Lease financing 7,825 7.69 150 6,574 7.88 129
Foreign 1,586 21.72 86 1,473 21.05 77
-------- ------ -------- ------
Total loans (4) 121,172 9.89 2,985 107,834 9.65 2,581
Other 3,336 5.68 46 2,420 4.72 30
-------- ------ -------- ------
Total earning assets $178,716 9.01 3,979 $164,590 8.59 3,504
======== ------ ======== ------
FUNDING SOURCES
Deposits:
Interest-bearing checking $ 3,052 1.40 11 $ 2,723 0.98 7
Market rate and other savings 56,896 2.52 357 55,578 2.37 325
Savings certificates 24,697 4.89 300 27,062 4.90 327
Other time deposits 3,204 5.26 42 3,714 5.13 47
Deposits in foreign offices 3,446 5.54 47 1,047 4.20 11
-------- ------ -------- ------
Total interest-bearing deposits 91,295 3.34 757 90,124 3.23 717
Short-term borrowings 25,507 5.84 370 17,556 4.80 208
Long-term debt 23,830 6.39 381 18,887 6.01 283
Guaranteed preferred beneficial interests in Company's
subordinated debentures 785 7.74 15 785 7.53 15
-------- ------ -------- ------
Total interest-bearing liabilities 141,417 4.33 1,523 127,352 3.88 1,223
Portion of noninterest-bearing funding sources 37,299 -- -- 37,238 -- --
-------- ------ -------- ------
Total funding sources $178,716 3.45 1,523 $164,590 3.01 1,223
======== ------ ======== ------
NET INTEREST MARGIN AND NET INTEREST INCOME ON
A TAXABLE-EQUIVALENT BASIS (5) 5.56% $2,456 5.58% $2,281
==== ====== ==== ======
NONINTEREST-EARNING ASSETS
Cash and due from banks $ 11,898 $ 11,239
Goodwill 7,932 7,734
Other 17,912 15,160
-------- --------
Total noninterest-earning assets $ 37,742 $ 34,133
======== ========
NONINTEREST-BEARING FUNDING SOURCES
Deposits $ 42,765 $ 42,770
Other liabilities 9,832 7,652
Preferred stockholders' equity 271 462
Common stockholders' equity 22,173 20,487
Noninterest-bearing funding sources used to
fund earning assets (37,299) (37,238)
-------- --------
Net noninterest-bearing funding sources $ 37,742 $ 34,133
======== ========
TOTAL ASSETS $216,458 $198,723
======== ========
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The average prime rate of the Company was 8.69% and 7.75% for the quarters
ended March 31, 2000 and 1999, respectively. The average three-month London
Interbank Offered Rate (LIBOR) was 6.11% and 5.00% for the same quarters,
respectively.
(2) Interest rates and amounts include the effects of hedge and risk management
activities associated with the respective asset and liability categories.
(3) Yields are based on amortized cost balances.
(4) Nonaccrual loans and related income are included in their respective loan
categories.
(5) 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% for all periods
presented.
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