Wells Fargo 2009 Annual Report Download - page 180

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Note 23: Operating Segments
As a result of the combination of Wells Fargo and Wachovia,
in first quarter 2009, management realigned its segments
into the following three lines of business for management
reporting: Community Banking; Wholesale Banking; and
Wealth, Brokerage and Retirement. The results for these
lines of business are based on our management accounting
process, which assigns balance sheet and income statement
items to each responsible operating segment. This process is
dynamic and, unlike financial accounting, there is no compre-
hensive, authoritative guidance for management accounting
equivalent to GAAP. The management accounting process
measures the performance of the operating segments based
on our management structure and is not necessarily compara-
ble with similar information for other financial services
companies. We define our operating segments by product
type and customer segment. If the management structure
and/or the allocation process changes, allocations, transfers
and assignments may change. We revised prior period
information to reflect the first quarter 2009 realignment of
our operating segments; however, because the acquisition
was completed on December 31, 2008, Wachovia’s results are
not included in the income statement or in average balances
for periods prior to 2009.
Community Banking offers a complete line of diversified
financial products and services to consumers and small
businesses with annual sales generally up to $20 million
in which the owner generally is the financial decision maker.
Community Banking also offers investment management and
other services to retail customers and securities brokerage
through affiliates. These products and services include the
Wells Fargo Advantage FundsSM, a family of mutual funds.
Loan products include lines of credit, equity lines and loans,
equipment and transportation (recreational vehicle and
marine) loans, education loans, origination and purchase
of residential mortgage loans and servicing of mortgage
loans and credit cards. Other credit products and financial
services available to small businesses and their owners
include receivables and inventory financing, equipment
leases, real estate financing, Small Business Administration
financing, venture capital financing, cash management,
payroll services, retirement plans, Health Savings Accounts
and merchant payment processing. Consumer and business
deposit products include checking accounts, savings deposits,
market rate accounts, Individual Retirement Accounts,
time deposits and debit cards.
Community Banking serves customers through a
complete range of channels, including traditional banking
stores, in-store banking centers, business centers, ATMs,
and Wells Fargo Customer Connection, a 24-hours a day,
seven days a week telephone service. Online banking
services include single sign-on to online banking, bill pay
and brokerage, as well as online banking for small business.
Community Banking also includes Wells Fargo Financial
consumer finance and auto finance operations. Consumer
finance operations make real estate loans to individuals in
the United States and the Pacific Rim, and also make direct
consumer loans to individuals and purchase sales finance
contracts from retail merchants from offices throughout
the United States, and in Canada and the Pacific Rim. Auto
finance operations specialize in purchasing sales finance
contracts directly from auto dealers in Puerto Rico and mak-
ing loans secured by autos in the United States and Puerto
Rico. Wells Fargo Financial also provides credit cards, lease
and other commercial financing.
Wholesale Banking provides financial solutions to businesses
across the United States with annual sales generally in excess
of $10 million and to financial institutions globally. Wholesale
Banking provides a complete line of commercial, corporate,
capital markets, cash management and real estate banking
products and services. These include traditional commercial
loans and lines of credit, letters of credit, asset-based lending,
equipment leasing, mezzanine financing, high-yield debt,
international trade facilities, trade financing, collection
services, foreign exchange services, treasury management,
investment management, institutional fixed-income sales,
interest rate, commodity and equity risk management,
online/electronic products such as the Commercial Electronic
Office® (CEO®) portal, insurance, corporate trust fiduciary
and agency services, and investment banking services.
Wholesale Banking also supports the CRE market with prod-
ucts and services such as construction loans for commercial
and residential development, land acquisition and development
loans, secured and unsecured lines of credit, interim financing
arrangements for completed structures, rehabilitation loans,
affordable housing loans and letters of credit, permanent
loans for securitization, CRE loan servicing and real estate
and mortgage brokerage services.
Wealth, Brokerage and Retirement provides a full range of
financial advisory, lending, fiduciary, and investment manage-
ment services to clients using a comprehensive planning
approach to meet each client’s needs. Wealth Management
uses an integrated model to provide affluent and high-net-
worth customers with a complete range of wealth management
solutions and services. Family Wealth meets the unique
needs of ultra-high-net-worth customers managing multi-
generational assets—those with at least $50 million in assets.
Retail Brokerage’s financial advisors serve customers’ advisory,
brokerage and financial needs, including investment manage-
ment, portfolio monitoring and estate planning as part of
one of the largest full-service brokerage firms in the United
States. They also offer access to banking products, insurance,
and investment banking services. First Clearing LLC, our
correspondent clearing firm, provides technology, product
and other business support to broker-dealers across the
United States. Retirement supports individual investors’
retirement needs and is a leader in 401(k) and pension record
keeping, investment services, trust and custody solutions for