Stumpf finally stands up to the media

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Feb 8, 2009 2:37 pm

Wells Fargo Chief Defends Employee-Recognition Events in Ad


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By David Glovin


Feb. 8 (Bloomberg) -- John Stumpf, chief executive officer of Wells Fargo & Co., defended corporate events that recognize top achievers after the bank canceled at least two because of what he said was “misleading” news coverage.


In a full-page ad in today’s New York Times, Stumpf said the events serve to honor top bankers, financial advisers, tellers and mortgage salespeople at the second-biggest U.S. home lender. The bank, which received $25 billion in government bailout aid last year, is compelled to cancel the meetings amid “misperceptions” created by media reports, he said.


“The problem is many media stories on this subject have been deliberately misleading,” Stumpf wrote. “These one-sided stories lead you to believe every employee recognition event is a junket, a boondoggle, a waste, or that it’s for highly-paid executives. Nonsense!”


Lawmakers and regulators have disparaged financial companies for perks and bonuses offered to employees since the U.S. government’s $700 billion rescue plan was announced in October. Citigroup Inc., which has $45 billion in government bailout funds, and U.S. Bancorp, the biggest bank based in Minnesota, also canceled employee-recognition events.


$2.55 Billion Loss


Wells Fargo, which was one of nine banks to receive funds in the first round of the U.S. Treasury’s bailout, said on Feb. 3 that it had canceled a four-day event for its home-lending unit in Las Vegas. The lender also said it had already abandoned plans for other functions.


The San Francisco-based bank last month reported a $2.55 billion fourth-quarter loss after acquiring Wachovia Corp. and its portfolio of troubled mortgages. Wells Fargo received $25 billion from the U.S. government in October as part of the Troubled Asset Relief program designed to spur lending and save the financial system.


Stumpf said in today’s ad the events typically recognize employees who work long hours and enabled the bank to make more than $500 billion in loan commitments and mortgage originations over the last 18 months.


“For many, it’s the only time in their lives that they’re publicly recognized and thanked for a job well done,” he wrote. “This recognition energizes them. It inspires them.”


The events are financed by bank profits, and not from the government, he said.


Wells Fargo spokeswoman Julia Tunis Bernard didn’t immediately return a call seeking further comment.


Wells Fargo’s event for the home-lending unit was scheduled to take place at Wynn Resort Ltd.’s hotels. An insurance-team meeting for 40 people was planned at the Mandalay Bay Resort & Casino starting Feb. 25, according to the Las Vegas Convention and Visitors Authority’s Web site.


Shares of Well Fargo rose $2.87 to $19.14 in New York Stock Exchange trading on Feb. 6. The stock is down 35 percent in the past 12 months.


To contact the reporter on this story: David Glovin in New York federal court at [email protected]

Last Updated: February 8, 2009 13:04 EST


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Feb 8, 2009 2:43 pm

Heard on the news cost them almost the same for not going as going.  Room cancellations were too late and did not get back any money.  Cant believe they did not just say that it was too late to cancel and we are going.

Feb 8, 2009 3:54 pm

Feb 8, 2009 5:33 pm

Fellow WS advisors.  Maybe this is a good time for those of you who haven't already to send your managers (branch, complex and regional) a little chin music.  If you've been accomodating to your managers, maybe they don't deserve your respect.  Retention coming by Thanksgiving...now by the Holidays...now by the Holidays or right after...now by the New Year or just after...now...maybe we should've done a better job of setting expectations. 

 
Maybe it's the advisors in this firm that need to set expectations.  This isn't a debate about whether we deserve retention or not or how much or little it should be.  Rather this is a moment to demand being treated with respect.  No retention...then tell me.  Retention...then tell me.  But treat me the same way you want me to treat my clients.  DL and co., if there's a situation causing delay (ubs, wfc board, etc) then tell us so.  Don't have to give us specifics...just be honest that there's a situation causing delay.  Managers saying they have no information either?  Too bad.  You're my manager and you get paid to deal with these situations.  Deal with it.  And deal with it better than you are.
 
I'm a DL fan and I don't know why some days.  But my point is that as difficult as these times are and as non communicative as our management has been, I'm hoping you all are making your managers sweat a bit.  Management needs you now more than ever.  I have no current plans to move due to a whole host of reasons, but I will always do what's best for my clients and if moving is best then I'll switch course and move.  So I don't hesitate to remind my manager constantly of the lucritive offers that are flying around right now.  I'm friends with my manager and we've always gotten along, but I make sure there is an uncomfortable feeling every time we talk.  And don't think these offers are going down or going away.  If you're a good advisor there will always be a good offer for you somewhere.  If you are any good at negotiating and are a quality advisor, no competing firm won't show you respect.  And if for whatever reason they don't, then f#$k them too.  
 
I wish you all success, riches and an end to this saga asap.   
Feb 9, 2009 7:31 pm

Fawn Liebowitz!  I thought you were killed in a horrible kiln explosion!

Feb 11, 2009 3:35 pm

Boo hoo.  It's hard to feel sympathy for banks that should rightfully be out of business for having the bad judgment to have gotten the nation and the economy into this mess to begin with.

 
Everyone in that company (or any others that participated in the CDO/credit swap baloney) should have lost their jobs and their vested shares in the company.  That's how Capitalism works.  You ^%&$ up, you pay the price.
 
Instead, they had $25 BILLION dollars handed to them courtesy of the US taxpayer, and they have the stones to whine about how their Vegas junkets are being treated in the press?
 
Boo.  Hoo.  Hoo.
Feb 11, 2009 4:22 pm

I'm not going to defend Wells Fargo, but (I guess the but means I am) the "junket" held was for pre-merger Wells Fargo folks. While they now own the crap in Wach's portfolio; the WF folks didn't create it. I give Wells Fargo credit (USB and JPM also) for managing through this storm masterfully. Short Sellers pummelling anything financial, Idiot Senators preaching from a pork laden bench, a media deliberately writing misleading headlines to sell papers and now brokers crying about not getting enough love from a "retention" bonus. Outside of the name, I didn't know anything about Stumpf, but I think I'd like to have a beer with him. I give him props.



I'd hate to leave out GS, not just for creating the CDO/SIV market for ridiculous profits, but for the foresight to short the market before it's implosion for even more profit. Capitalism in it's raw form...

Feb 12, 2009 11:34 am
Incredible Hulk:

I'd hate to leave out GS, not just for creating the CDO/SIV market for ridiculous profits, but for the foresight to short the market before it's implosion for even more profit. Capitalism in it's raw form...

 
Yeah, it looks like GS was the only company that actually knew what was going on.  Or, if nothing else, showed enough fear about not knowing what was going on.  Buffet was smart to buy $5 billion is GS shares; GS is the sole winner in this debacle.