What are these new 'Principal at Risk Securities'?

These are debt instruments where the repayment of the principal amount is contingent on the performance of an underlying asset, in this case, the SPDR® S&P® Oil & Gas Exploration & Production ETF. If the ETF performs poorly, investors may lose a portion or all of their principal.

What is the SPDR® S&P® Oil & Gas Exploration & Production ETF?

This is an Exchange Traded Fund (ETF) that tracks the performance of companies involved in the exploration and production of oil and gas. Its performance reflects the general trends and volatility within the energy sector.

What is the maturity date for these notes and what happens then?

The notes mature on September 24, 2019. At maturity, the amount repaid to the investor will depend on the performance of the linked ETF. The specific payout structure, including potential principal loss, is detailed within the Form of Note filed as part of this report.

Why is Wells Fargo issuing these types of securities?

Wells Fargo, like many financial institutions, issues a variety of structured products to meet different investor needs and risk appetites, and to potentially access funding at competitive rates. These notes likely cater to investors seeking exposure to the energy sector with a specific risk/return profile.

WELLS FARGO & COMPANY/MN 8-K SEC Disclosure

Summary

This 8-K filing by Wells Fargo & Company/MN (WFC) on September 22, 2017, primarily serves to disclose the issuance of new financial instruments. Specifically, the company has issued Medium-Term Notes, Series K, Principal at Risk Securities Linked to the SPDR® S&P® Oil & Gas Exploration & Production ETF, with a maturity date of September 24, 2019. For investors, the key takeaway is the introduction of a new debt-like security whose performance is directly tied to the SPDR® S&P® Oil & Gas Exploration & Production ETF. This means the principal repayment and any potential returns on these notes are subject to the volatility and performance of the oil and gas exploration and production sector, as tracked by the specified ETF. Investors considering these notes should carefully evaluate the risks associated with the energy sector and the structured nature of these securities.

Key Highlights

1Wells Fargo & Company issued new Medium-Term Notes, Series K, on September 21, 2017.
2These notes are Principal at Risk Securities, meaning the principal is at risk.
3The performance of the notes is linked to the SPDR® S&P® Oil & Gas Exploration & Production ETF.
4The maturity date for these notes is September 24, 2019.
5The filing includes the form of the Note and the legal opinion from Faegre Baker Daniels LLP.
6The primary purpose of this filing is to provide transparency regarding the terms and legal standing of these new securities.

WELLS FARGO & COMPANY/MN 8-K Report, Exhibit Filing (Sep 22, 2017)

Summary

Key Highlights

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