10-KPeriod: FY2018

WELLS FARGO & COMPANY/MN Annual Report, Year Ended Dec 31, 2018

Filed February 27, 2019For Securities:WFCWFC-PDWFC-PCWFC-PYWFC-PAWFC-PLWFCNPWFC-PZ

Summary

Wells Fargo & Company (WFC) filed its 2018 10-K on February 26, 2019, detailing its operations and financial condition as of December 30, 2018. The company, a significant financial holding and bank holding company, reported total assets of $1.9 trillion and deposits of $1.3 trillion. WFC operates through three primary segments: Community Banking, Wholesale Banking, and Wealth and Investment Management. The filing highlights the highly competitive nature of the financial services industry, with WFC facing competition from traditional institutions and emerging nonbank and online entities. A significant portion of the report addresses the extensive regulatory environment applicable to WFC, including oversight from the Federal Reserve Board, OCC, FDIC, and CFPB, among others. The company's status as a financial holding company and its compliance with various regulations, including the Community Reinvestment Act (CRA), are crucial considerations for investors. Additionally, the report touches upon dividend restrictions and capital requirements imposed by regulators.

Financial Highlights

41 data points
Beta

Revenue

$86.41B

Net Income

$22.39B

25.9% Net Margin

EPS (Diluted)

$4.28

Total Assets

$1.90T

Cash & Equivalents

$173.29B

Free Cash Flow

$36.07B

Financial Statements
Beta
Revenue$86.41B
Interest Expense$14.65B
Net Income$22.39B
EPS (Basic)$4.31
EPS (Diluted)$4.28
Shares Outstanding (Basic)4.80B
Shares Outstanding (Diluted)4.84B

Key Highlights

  • 1Wells Fargo reported $1.9 trillion in assets and $1.3 trillion in deposits as of December 31, 2018.
  • 2The company operates across three main segments: Community Banking, Wholesale Banking, and Wealth and Investment Management.
  • 3WFC faces intense competition from a diverse range of financial service providers, including traditional banks, credit unions, finance companies, and newer fintech companies.
  • 4The company is subject to extensive regulation by multiple federal and state agencies, including the Federal Reserve, OCC, FDIC, and CFPB.
  • 5A 'Needs to Improve' CRA rating received in March 2017 imposes restrictions on engaging in new activities or acquiring companies.
  • 6Regulatory capital requirements (e.g., Basel III, G-SIB surcharge) and stress testing are key considerations for the company's financial management and distribution policies.
  • 7The company's ability to pay dividends is subject to various statutory provisions, regulations, and agreements with its subsidiary banks and regulators.

Frequently Asked Questions

As of December 31, 2018, Wells Fargo reported total assets of $1.9 trillion, loans of $953 billion, deposits of $1.3 trillion, and stockholders' equity of $196 billion.

Wells Fargo organizes its business into three operating segments for management reporting: Community Banking, Wholesale Banking, and Wealth and Investment Management.

Wells Fargo's CRA rating was downgraded to 'Needs to Improve' in March 2017. This rating subjects the company to prohibitions on engaging in new activities or acquiring companies, except for those closely related to banking, until the rating is improved to 'Satisfactory' or better.

As a large bank holding company, Wells Fargo is subject to stringent regulatory capital requirements, including Basel III and G-SIB surcharges. The Federal Reserve requires annual capital plans and regulatory approval for capital distributions like dividends. Failure to meet minimum capital ratios, leverage ratios, or stress test requirements can lead to restrictions on capital distributions.