Signs of change

By Dick Hughes  

SEPTEMBER 22, 2011 11:30 a.m. (0)

Wells Fargo bankers believe they can build on the dominant state position inherited from Wachovia with greater resources and a culture allowing for more local authority.

With little fanfare, the conversion of Wachovia to Wells Fargo in South Carolina was completed Monday, nearly three years after the San Francisco bank agreed to acquire failing Wachovia in the worst days of the recession.

The acquisition propelled Wells Fargo to the nation’s fourth largest, a position Wachovia had held, with $1.3 trillion in assets.

The company re-branded 148 stores and 287 ATMs in South Carolina. Down came blue and green Wachovia signs, replaced with Wells Fargo’s red and gold signs and the image of a stage coach pulled by a six-horse team that has been part of Wells Fargo since 1852.

The conversion of Wachovia branches started in the West and moved east. North Carolina, where Wachovia was based, will be converted in mid-October.

Richard “Rick” Redden, president of Wells Fargo South Carolina, and Brian Rogers, senior vice president and Greenville market president, said being late in the process worked to South Carolina’s advantage.

“Anything that has gone wrong with customers has been addressed,” said Redden. “The dilemma with that is we’ve had to wait awhile. Our team has been ready to put that flag out and move on as Wells Fargo for awhile.”

Protecting the Top Turf

They said while the change in retail branches took place over the weekend, most business and commercial lines of business were converted earlier.

Redden and Rogers, who held similar positions with Wachovia, said Wells Fargo used the time before official conversion to build up staffing, introduce new products and orient employees on Wells Fargo’s culture.

Wells Fargo has a lot to protect in South Carolina.

In Wachovia, it acquired the state’s largest bank in terms of deposits – $11.6 billion – with close to 17 percent of the market, according to FDIC data.

It is No. 1 in Charleston, Columbia and Florence, No. 2 in Greenville, the state’s most competitive market, and No. 3 in Spartanburg.

Giving Wells Fargo an opportune opening is having relationships of some sort with 40 percent of the households in South Carolina through mortgages, mortgage servicing, credit cards, car loans and the like, they said.

In addition to the new products, Redden said, Wells Fargo can implement programs that Wachovia had but couldn’t implement because they were struggling.

“There were products we offered three years ago as Wachovia, like merchant services or business payroll services, but we didn’t have the pros in South Carolina who could meet with customers, explain it and implement it. We do now,” he said.

Stacking the Personnel Deck

Redden said while many other banks “are hunkering down,” Wells Fargo added 500 employees to its South Carolina team in the last two and a half years, bringing its statewide employment to 6,025 as the state’s largest bank employer, as was Wachovia. More than 600 are in the Upstate.

“We have more than doubled the number of bankers in our stores, and we’ve increased our business and commercial banking team by 25 percent.”

The personnel additions to Wells Fargo’s headquarters on the third floor of Wells Fargo Place, renamed from Wachovia, on South Main Street in Greenville has pumped up enthusiasm and created space problems, Rogers said.

“I walked around this floor a few years ago and counted something like 20 empty offices or cubicles, and now we are adding cubicles to bring in new employees,” he said. “We are pretty close to busting at the seams here. We have room for three more cubicles on this floor, and we are sold out.”

Redden said Wells’ bank managers feel empowered by Wells’ decentralization culture giving local bankers “more authority to make decisions, and these decisions range from credit decisions to customer resolution decisions to philanthropy to investing in community.”

“With a lot of national banks,” he said, “it is one-size fits all. It either works or doesn’t work. The flexibility we have with the resources that match up with our markets is significantly more than it was before.”

Making Small Big, Big Small

They said the wide array of products, well-staffed offices with veteran bankers, a strong balance sheet and ability to make local decisions gives them what they need “to out-national the locals and out-local the nationals.”

Redden and Rogers said there has been virtually no turnover as a result of the acquisition.

“We’ve got, particularly from the leadership standpoint, bankers who started in South Carolina 20 years ago, have been through successor companies, care about living in South Carolina and are not looking to go someplace else,” Redden said.

Redden and Rogers said there some encouraging signs that loan activity is picking up. In the Upstate, said Rogers, his group is at 150 percent of its 2011 goal for business and commercial lending with more than three months to go.

“It’s coming from new clients we brought in from other organizations. It is coming from existing clients who have survived and in many cases, believe it or not, flourished and have started to buy equipment, expand their inventory and have increased their lines of credit with us.”

Statewide, Redden said, Wells Fargo is seeing loan volume come back.

“But it still is anywhere from a third to a fifth of what it was at the peak, so it is a slow rebuild,” he said.