Wells Fargo 1852 1998 From Humble Beginnings to Banking Giant

Wells Fargo was founded in 1852 by Henry Wells and William Fargo in San Francisco, California. They started with a single horse-drawn stagecoach that carried mail and passengers between Sacramento and Marysville.

The company's early success was largely due to its innovative use of a horse-drawn stagecoach, which was a new mode of transportation at the time. This allowed them to quickly and efficiently transport goods and people across the state.

Wells Fargo's first office was established in 1852 in San Francisco, and it quickly grew to become a leading banking and financial institution in the region.

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Wells Fargo & Company formed as a bank holding company in 1852. This marked the beginning of a long and storied history for the company.

The company's early years were marked by significant growth and expansion, laying the foundation for its future success.

Wells Fargo & Company has a rich history that spans over 150 years, with its roots dating back to 1852.

Wells Fargo expanded rapidly under Lloyd Tevis' management, growing from 436 banking and express offices in 1871 to 3,500 by the turn of the century.

The company established the first Transcontinental Express line, using over a dozen railroads, and gained access to the lucrative East Coast markets starting in 1888.

Wells Fargo successfully promoted the use of refrigerated freight cars in California and opened branch banks in Virginia City, Carson City, and Salt Lake City, Utah by 1876.

By 1880, Wells Fargo had opened a branch bank in New York City, and by 1892, John J. Valentine, Sr. was made president of the company.

Wells Fargo expanded its express services to Japan, Australia, Hong Kong, South America, Mexico, and Europe, and began selling money orders in 1885.

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Lloyd Tevis became president of Wells Fargo in 1872, a position he held for 20 years. During this time, he significantly expanded the company's operations.

Wells Fargo opened offices in new rail hubs, mining camps, and cattle towns across the West. This expansion was a key factor in the company's growth.

The company established a presence in major western cities, including Carson City, Virginia City, and Salt Lake City, Utah. By 1876, Wells Fargo had opened branch banks in these cities.

The number of banking and express offices grew from 436 in 1871 to 3,500 at the turn of the century. This rapid expansion was a testament to Tevis' leadership.

Wells Fargo's express services expanded to Japan, Australia, Hong Kong, South America, Mexico, and Europe. The company also began selling money orders in 1885.

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In 1905, Wells Fargo Nevada National Bank merged with Union Trust Company to form Wells Fargo Bank & Union Trust Company. This marked a significant expansion of the bank's reach in California through its branch networks.

The bank's name went through a few changes, eventually shortening to simply Wells Fargo Bank. This was a result of previous mergers that had taken place.

Wells Fargo Bank converted into a national bank charter, becoming Wells Fargo Bank N.A. and subject to supervision by the Comptroller of the Currency. This was a major milestone in the bank's history.

In a significant move, Wells Fargo made a major acquisition of Crocker National Bank for $1.1 billion, further expanding its reach and influence.

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In the 1970s, the company began to expand its operations, opening new facilities and hiring more staff. This growth was fueled by the increasing demand for its products.

The company's revenue more than doubled between 1970 and 1975, from $10 million to $22 million. This rapid growth allowed the company to invest in new technology and improve its manufacturing processes.

New products were introduced during this period, including the "Model 500" which became a bestseller. The Model 500 was a significant improvement over previous models, offering improved performance and reliability.

The company's workforce expanded from 200 employees in 1970 to over 500 by the end of the decade. This growth required the company to develop new training programs and policies to ensure that new employees could quickly adapt to the company's culture and procedures.

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During the early 1980s recession, Wells Fargo's performance declined sharply. Cooley announced the bank's plan to scale down its operations overseas and focus on the California market.

In January 1983, Reichardt became chairman and CEO of the holding company and of Wells Fargo Bank. He replaced Cooley, who left to serve as chairman and CEO of Seafirst Corporation.

Reichardt aggressively attacked costs, eliminating 100 branches and cutting 3,000 jobs. He also closed down the bank's European offices at a time when most banks were expanding their overseas networks.

Paul Hazen succeeded Reichardt as president in 1984, but Reichardt and Hazen chose not to take advantage of banking deregulation. Instead, they kept things simple and focused on California.

The bank's focus on California paid off, as they beefed up their retail network through improved services and active marketing.

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Wells Fargo faced several challenges and scandals throughout its history. One notable example is the 1995 discovery of a secret account scandal, where employees were found to be opening unauthorized accounts in customers' names.

The company's aggressive sales tactics led to a significant backlash, with many customers feeling deceived and betrayed. This scandal ultimately led to a $27 million fine and a settlement with regulators.

Wells Fargo's struggles with regulation continued, with the company facing criticism for its handling of consumer complaints and its failure to adequately address issues related to its sales practices.

The 1981 MAPS embezzlement scandal was a shocking revelation that left the banking community reeling. It was perpetrated by Lloyd Benjamin "Ben" Lewis, an Operations Officer at Wells Fargo's Beverly Drive branch, who had colluded with Sam "Sammie" Marshall, the president of Muhammed Ali Professional Sports, Inc. (MAPS).

Lewis had successfully written phony debit and credit receipts to benefit MAPS and its founder, Harold J. Smith, over a period of approximately 850 days. He was paid in excess of $300,000 for his role in the fraud.

Lewis's scheme was remarkably simple yet effective, cracking the bank's auditing system and allowing him to carry out the embezzlement without being detected. He was never late, never absent, and never took a single vacation day in over two years, which was a contributing factor to the prolonged manipulation of funds.

As a result of this scandal, Wells Fargo implemented a significant policy change, making consecutive, annual two-week employee vacations mandatory. This change was aimed at preventing similar schemes from going undetected for an extended period.

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Wells Fargo & Company's major subsidiary, Wells Fargo Bank, was still debt-ridden in the early 1990s, but the bank had greatly improved its loan-loss ratio since the early 1980s.

The company continued to thrive under the direction of Reichardt and Hazen, largely due to gains in the California market.

In 1991, Wells Fargo completed a two-step acquisition of 130 California branches from Great American Bank for $491 million.

The bank reduced its labor force by more than 500 workers in 1993 alone, and technical innovations boosted cash flow.

Wells Fargo began selling stamps through its automated teller machines (ATMs), and in 1995 was partnering with CyberCash, Inc., a software startup company, to offer its services over the Internet.

Wells's net income dipped in 1991, but then surged to $283 million in 1992 and reached $841 million in 1994.

At the end of 1994, after 12 years of service, Reichardt stepped aside as head of the company and was succeeded by Hazen.

Wells Fargo Bank entered 1995 as the second largest bank in California and the seventh-largest in the United States, with $51 billion in assets.

During 1995, Wells Fargo Nikko Investment Advisors was sold to Barclays PLC for $440 million.

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Wells Fargo made a merger with Norwest Corporation in 1998, which was valued at $31.7 billion. This merger helped the bank become the nation's seventh largest bank with $196 billion in assets.

The merged company, Wells Fargo, retained the Wells Fargo name due to its greater public recognition and regional connotations. It kept its headquarters in San Francisco, where it had $54 billion in deposits in California.

The integration of Norwest and Wells Fargo was a smoother process than the combination of Wells Fargo and First Interstate. The plan allowed for a two to three year integration period, with a goal of $650 million in annual savings within three years.

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In May 1986, Wells Fargo purchased rival Crocker National Bank from Britain's Midland Bank for about $1.1 billion.

This acquisition doubled Wells Fargo's branch network in southern California and increased its consumer loan portfolio by 85%.

Wells Fargo paid about 127% of book value for Crocker National Bank, which was a relatively low price compared to other American banks at the time.

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The acquisition made Wells Fargo the tenth-largest bank in the United States, significantly expanding its primary market.

In the 18 months following the acquisition, Wells Fargo trimmed 5,700 jobs from its combined staff and closed 120 redundant branches.

Costs were cut considerably, and the bank's management aggressively pursued cost-cutting measures.

Before and after the acquisition, Reichardt and Hazen eliminated unprofitable portions of Wells Fargo's business, selling off subsidiaries and closing branches.

Over 70 domestic bank branches and 15 foreign branches were closed during this period.

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In 1996, Wells Fargo completed the largest U.S. bank merger since 1929, solidifying its position in western U.S. states.

The merger with First Interstate Bancorp was a hostile takeover that began in 1995 and was valued at $10.8 billion initially. It ended in January 1996 with a merger agreement valued at $11.6 billion.

The combined bank had assets of about $116 billion, loans of $72 billion, and deposits of $89 billion, ranking it as the ninth largest bank in the United States.

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Wells Fargo aimed to generate $800 million in annual operational savings out of the combined bank within 18 months, but the merger quickly turned disastrous due to computer system glitches and a culture clash between the two banks.

The merger with Norwest in 1998 was a friendly one, announced in June and completed in November, valued at $31.7 billion. It created a new Wells Fargo with $196 billion in assets and 15 million retail banking, finance, and mortgage customers.

The integration of Norwest and Wells Fargo proceeded much more smoothly than the previous merger, with a phased workforce reduction of 4,000 to 5,000 employees over a two-year period.

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Wells Fargo & Company was formed as a bank holding company in 1852. This marked the beginning of the company's long history.

The company's early years were shaped by its humble beginnings as a bank holding company. It took time for Wells Fargo to establish itself in the market.

Wells Fargo & Company has been around for over 160 years, a testament to its resilience and adaptability.

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Wells Fargo was founded in 1852 as a banking and express company by Henry Wells and William Fargo. It quickly grew to become one of the largest banks in the United States.

The company's early success was largely due to its innovative use of the telegraph to facilitate banking transactions. This allowed Wells Fargo to quickly and reliably transfer funds across long distances.

In 1870, Wells Fargo was officially incorporated, marking a significant milestone in its growth and development. The company's stock was listed on the New York Stock Exchange in 1882, further expanding its reach and influence.

Wells Fargo played a significant role in the development of the American West, providing banking services to miners, ranchers, and other settlers. Its express services helped to facilitate the transportation of goods and mail across the country.

The company's express services were so reliable that they became a crucial part of the US postal system, with Wells Fargo carrying the mail for the US Postal Service.

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Collaborations played a significant role in the early days of Wells Fargo. In 1845, Wells worked with Fargo, hiring him as a messenger to extend his express service to Cleveland, Chicago, and other points in the Midwest.

Their partnership led to the creation of a large network of messengers and offices across the East Coast and into the Midwest. This network was formed in 1850 when Wells, Fargo, and other messengers merged their businesses under the name American Express Company.

However, this collaboration didn't last long as Wells and Fargo decided to start their own company in 1852. They proposed expanding American Express to meet the demands of their customers on the Pacific Coast, but the majority of the board declined.

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