Wells Fargo quietly expanding its footprint

Close your eyes and think of the most valuable bank in U.S. history. Nope, it’s Wells Fargo. The San Francisco bank just surpassed the old record set by Citigroup in 2001, and it did so in an old-school and somewhat boring fashion: retail deposits.

Wells Fargo currently derives an astounding 78% of its funding from deposits, following Chief Executive Officer John Stumpf’s safe, consumer-focused model. However, Wells is simultaneously spreading its wings into other businesses as the mortgage industry is being reshaped. No longer can Wells Fargo depend on its sprawling mortgage business that was buoyed by the refinancing boom that has since ended.

The bank’s growth plans are multiple. First, it is expanding into Europe with its bread-and-butter businesses: real estate and asset-based lending. But it is also straying into newer corners. Financial News is reporting that Wells is currently looking to hire in derivatives services and credit trading, areas where other banks in the region are cutting back.

Elsewhere, Wells is following in the footsteps of other bulge bracket banks by expanding its presence in asset management. The bank will act aggressively on all fronts, meaning acquisitions, bigger sales targets and more hiring, particularly in Europe. The initiative even has a rather blunt internal nickname: "Big Hairy Audacious Goal,” according to the Wall Street Journal. They plan is to target a greater number of institutional investors - like pension funds - and even possibly expand into exchange-traded funds.

Finally, following the high-profile hack of J.P. Morgan, Wells Fargo is stepping up its recruitment efforts in cyber security. The bank is planning the launch of three “Cyber Threat Fusion Centers,” and employs a team of roughly 60 cyber security pros.

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Quote of the Day: “You’ll always be busy anyway, and people remember the quality of your work, not how much you can take on.” – Mark Hatz, a former M&A associate at Goldman Sachs and Perella Weinberg Partners on why you shouldn’t ever ask for more work