We have wonderful ethnic, geographic, gender and experiential diversity on our board. Five of our board members are persons of color, five are women, and they come to us with different disciplines and different geographies. In the case of Phil Quigley, he has reached his retirement age and he will not stand for re-election. His son works in one of our groups in southern California and he didn’t even know his son had applied for a job until he got it. And I don’t recall if Cynthia Milligan’s brother is now retired or not, but those are the only two (board) members that I know that have family members (at the bank) and both of them enjoy very high re-election numbers. If you look at the SEC and New York Stock Exchange independence rules, they pass all of those. I never even hear it as an issue.
— People hate bank fees. Bank of America just decided to postpone new fees on its checking accounts. Where do you see this going?
We try to be transparent in what we do. I think what really irritates customers is where they believe they got something at this price and find out there’s some other language in there and they really paid this price.
What we want to provide for customers is a good, fair deal. We have 6,000 (branches), 12,218 ATM machines, 24/7 bankers, online, and all this stuff costs money. We give people (free) access if they do enough business with us. If they choose not to do business with us but for one thing, we charge them ($7) a month for the access to that nationwide distribution. That’s a bargain. Our customers understand that. We've had minimal issues in that area. Our customers have higher loyalty scores with us than we've ever had.
— You started in the business as a repo guy, so you had to show up at people’s houses and take back their cars, their washing machines or whatever else they could no longer make payments on. What did you learn from that?
When you make a bad loan, a lot of people suffer. Your shareholder suffers, customers suffer. People go into a loan wanting to make it work, and they want to pay their debts.
—Any good stories?
One time I was repo-ing a chain saw out on a farm north of the Twin Cities. I heard the chain saw, so I walked around the house and some guy was cutting wood. He said, ‘What do you want?’ and I said, ‘I'm here for the chain saw,’ and he picked up the chain saw in one hand and then a shotgun in the other, and he said, ‘Here, come and get it.’ And I said, ‘Maybe I don’t need that chain saw right now.’
—You've been pretty outspoken against some of the new government regulations imposed on the banking industry.
I'm not against regulation. I like good, effective regulation. What I worry about are the unintended consequences of well-intended people who pass laws that make it harder to lend money, make it more difficult for consumers and small businesses and large businesses to get credit.
—You said, for example, that you were worried about possible new rules on remittances, when bank customers send money to relatives in their home countries. Tell us about that. (The government is proposing rules that would require companies to give customers more detail about the expected fees and taxes, and to make sure the correct person picks up the money on the other end.)
So a customer brings $200 in, says, ‘I want to wire this money to Mexico,’ ‘I want to send it to Vietnam,’ ‘I want to send it to Cambodia,’ wherever they want to send it to. We do that every day at a great bargain for the customer. (But) the rules are so archaic and difficult to comply with that we might have to exit some businesses and not serve customers. That’s what I worry about.
That’s just one small example. That’s a small business. Wait until they opine on mortgages, which is a big business.
—You were outspoken against the idea of a standalone Consumer Financial Protection Bureau when it was proposed. What do you think of the job they've done so far?
These are good people, and they've been asked to do an impossible job. I hope they get it right.
—What do you think about their putting the complaints against your bank and others on the Internet?
You know, we talk to our customers every day. If that’s the best way for them to make that information available, that’s up to them.
—Warren Buffett is your biggest shareholder. (His conglomerate, Berkshire Hathaway, holds an 8 percent stake in Wells, about $14 billion worth, according to financial data provider FactSet.) Tell us about that.
He reads everything. One time I talked to him on a Monday, we'd put out our 10-Q (a quarterly financial report) on a Friday, and he said he spent all day Saturday reading it cover to cover. I said, ‘Warren, you do that often?’ He said, ‘Oh, I love Q's.’ He was asking me about some esoteric asset — I was blown away.Continued...