Bad news for Wachovia (WB) and WaMu (WM) shareholders counting on a Wells Fargo (WFC) takeover bid to save them: WFC CEO John Stumpf says a large acquisition is “highly unlikely.”
Wells Fargo has been outperforming its peers during the credit crisis. While other banks have been reporting losses and write-downs, WFC has been posting profits and has even raised its dividend. Speculation has surrounded a WFC move due to its high market value (now equal to Citi’s), high credit rating, and strong profits. But Stumpf explains that blockbuster deals aren’t WFC’s focus:
“We don’t need to do a deal. Organic growth is the core growth engine in this company.”
…Mr Stumpf noted that since the 1998 merger between Norwest and Wells Fargo, the group had eschewed large acquisitions, preferring to focus on bolt-on purchases of companies in the western states.
“We come from a culture where bigger is not better. You get bigger by being better, you don’t get better by being bigger,” he said, adding that Wells was also unlikely to stray from its western focus by buying on the East Coast.
Business Insider Emails & Alerts
Site highlights each day to your inbox.