With access to the entire world available to him on a daily basis, Tim Sloan, President and CEO of Wells Fargo Bank, chose a thoughtful avenue with which to open his presentation to the San Marino City Club on Tuesday night.
“We have had an incredible experience living here in San Marino,” Sloan told the largest audience the group has had in years. “Relocating to San Marino is one of the best decisions I have ever made in my life. The first, of course, was asking my wife, Lisa, to marry me.”
Sloan then introduced his bride, who was in attendance at the San Marino Center, amidst a sea of “aws” and applause.
“This has been an incredible community in which to raise our three children. Lisa has been involved in every activity possible, including co-chair of Grad Night. I was asked to serve as president of San Marino Little League. Got involved in the building of the new football field. Our sons played in different years but with the same number.”
Sloan then paused and seemed pensive.
“And the city has given back to us,” he said, among the silent room. “We recently had some visitors at our house.”
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Upon determining the import of Sloan’s comment, the audience again broke out in laughter. Sloan was referring to a protest against the Dakota Pipeline that broke out in front of his home two weeks ago.
“Chief Incontro, Cindy Collins…you did a great job,” Sloan said as the laughter increased. “John [Incontro], get good at it. It’s going to happen again. Unfortunately, this is the environment that we are going to have to exist in for a while.”
Sloan also joked that he was surprised to see some of his neighbors helping to hold up the inflatable pipeline that was brought by protesters as well as participating on the chant of “Lock him up,” that was directed at Sloan.
“But my favorite place in the world is San Marino, California,” he declared.
Quickly changing course, Sloan reflected back to the beginnings of the recent economic meltdown.
“Remember back in 2008 when it felt like the world was going to end and, well it actually was,” he said. “When you step back and think abut the failures of savings and loans, debt markets were freezing up and home values were plummeting.”
Sloan then referenced several government programs that came to the assistance of financial institutions, including TARP – the Troubled Asset Relief Program – and Dodd-Frank.
He pointed out that Wells Fargo currently has twice as much capital as in 2008 in what he called “the strongest financial industry in the world.”
“The situation today is a very, very attractive one,” he said. “The financial industry is as strong as it has ever been and will continue to play a key role in the economy. Our current view is the economy will pick up steam,”
He said that a recent survey showed that consumers are “more optimistic than they have been since the great recession.”
He also said he expects the economy to grow 2-1/2 – 3% this year.
“Could you ever imagine having interest rates as low as they are today?” Sloan asked. “When Lisa and I bought our first condominium in Chicago, the interest rate was 13-1/4 percent. And now people are complaining about going from 3-4 percent. But maybe that’s just my banker’s justification for higher rates,” another comment that drew hearty laughter.
The University of Michigan graduate then switched topics.
“What’s going on in Washington?” he asked rhetorically. “We have 70 million customers and 270,000 team members who work at Wells Fargo so you will upset half of them with whatever you say so…I don’t,” he added, referring to the current political climate.
He said that consumer regulation is “incredibly important.”
“The basics of borrowing money, what a credit card is, we think it is very important that consumers are protected. We would rather have the ability to lend more money out to people who need it.”
Sloan said Wells Fargo spends $50 million annually to eduicate customers.
Sloan said he expected “a reasonable rollback of some of the protection” from the Trump Administration.
“There will be a lot of excitement that banks are trying to take advantage of people, but that is not gong to happen,” Sloan said. “This will result in lower interest rates and we will be able to help more customers.”
He then moved into the sensitive topic of the many charges filed against Wells Fargo that resulted in the ouster of former President and CEO John Stumpf last fall and opened the door for Sloan to take the reins of the stagecoach.
“We made some terrifically bad decisions in our retail banking that we have paid for tremendously and my predecessor paid for with his job,” Sloan said solemnly. “We made some horrible mistakes. We should have recognized it earlier and dealt with it right away.
We have owned up to those mistakes. We have negotiated settlement agreements with regulators. And at about the worst time in history, this last Presidential election, we became a prop for both parties. That was tremendously painful.”
Sloan said his job “is to rebuild trust in an incredibly successful organization” after Wells Fargo employees were accused of creating fake accounts to meet sales quotas.
“I think about that every day,” he told the rapt audience. “We need to make sure we have everything in place to address the concerns of the public.”
Sloan said Wells Fargo has “refunded millions of dollars to customers. We have contacted 43 million customers and told them if we have made a mistake, come see us and we will fix it. If not, we will pay for a mediator.”
“We will get this right,” Sloan declared.
Sloan said he has spent a great deal of time meeting with Wells Fargo employees, whom he continuously referred to as “team members” during his address, who “In September went to work for a company they loved. A few weeks later they felt betrayed by that company.”
He also said that Wells Fargo “is fixing the things that are broken.”
“We tossed out our old incentive program and rolled out a new one that is focused on customer service. This one is based on loyalty, not on selling products.”
He said the company is “winning our customers back and are making great efforts to be more transparent. We are making good progress.”
The 156-year-old company began as a stagecoach delivery service, Sloan said, “until this business model was found to be inferior to that of the train.”
Wells Fargo is now a $1.9 trillion enterprise with representation in 42 countries.
“We have more than 13,000 ATMs,” he said. “Five of them are on Huntington Drive.”
Another of his many, many laugh lines.
The Tribune’s 2012 Citizen of the Year said the task of building a better bank lies in “better methodology.”
“How can we improve our interaction with customers?” he said. “We are seeing a lot of changes in the market. We feel cardless ATMs will be coming soon. And within the next 5, 10, 15 years, all of your banking will be done on your phone.”
He also mentioned another option that could be credited towards Wells Fargo’s strong commitment to philanthropy.
“Soon, when you are spending too much, you might get a note from us,” Sloan said. “You don’t have to worry about your spouse. Think of the marriages we will be saving.”
Then over the roar of laughter.
“See we’re doing good…”
