Wells Fargo 2013 Annual Report Download - page 100

Risk Management – Asset/Liability Management (continued)
On January 6, 2013, the Basel Committee on Bank
Supervision (BCBS) endorsed a revised Basel III liquidity
framework for banks. In October 2013, a Notice of Proposed
Rulemaking (NPR) regarding the U.S. implementation of the
Basel III liquidity coverage ratio (LCR) was issued by the FRB,
OCC and FDIC. The NPR’s public comment period closed on
January 31, 2014, and the agencies will review and take into
consideration the comments filed on the proposal before
adopting a final rule. The FRB recently finalized rules imposing
enhanced liquidity management standards on large BHCs such
as Wells Fargo. We will continue to analyze these proposed and
recently finalized rules and other regulatory proposals that may
affect liquidity risk management to determine the level of
operational or compliance impact to Wells Fargo. For additional
information see the “Capital Management” and “Regulatory
Reform” sections in this Report.
Parent Under SEC rules, our Parent is classified as a “well-
known seasoned issuer,” which allows it to file a registration
statement that does not have a limit on issuance capacity. In
April 2012, the Parent filed a registration statement with the
SEC for the issuance of senior and subordinated notes, preferred
stock and other securities. The Parent’s ability to issue debt and
other securities under this registration statement is limited by
the debt issuance authority granted by the Board. The Parent is
currently authorized by the Board to issue $60 billion in
outstanding short-term debt and $170 billion in outstanding
long-term debt. At December 31, 2013, the Parent had available
$41.9 billion in short-term debt issuance authority and
$82.2 billion in long-term debt issuance authority. The Parent’s
debt issuance authority granted by the Board includes short-
term and long-term debt issued to affiliates. During 2013, the
Parent issued $13.1 billion of senior notes, of which $6.9 billion
were registered with the SEC. In addition, during 2013, the
Parent issued $5.5 billion of subordinated notes, all of which
were registered with the SEC. During fourth quarter 2013, the
Parent exchanged $2.1 billion of subordinated notes issued by
Wells Fargo Bank, N.A. for $2.4 billion of unregistered
subordinated notes issued by the Parent. In addition, during
fourth quarter 2013, the Parent exchanged $672 million of
subordinated notes issued by the Parent for $723 million of
unregistered subordinated notes issued by the Parent. A
registration statement filed by the Parent on December 17, 2013,
was declared effective on January 3, 2014, and provides for these
newly issued unregistered subordinated notes to be exchanged
for registered securities. The offer to exchange these
unregistered subordinated notes for registered notes
commenced on January 6, 2014. In addition, in January 2014,
the Parent issued $1.7 billion of registered senior notes.
The Parent’s proceeds from securities issued in 2013 were
used for general corporate purposes, and, unless otherwise
specified in the applicable prospectus or prospectus supplement,
we expect the proceeds from securities issued in the future will
be used for the same purposes. Depending on market conditions,
we may purchase our outstanding debt securities from time to
time in privately negotiated or open market transactions, by
tender offer, or otherwise.
Table 55 provides information regarding the Parent’s
medium-term note (MTN) programs. The Parent may issue
senior and subordinated debt securities under Series L & M, and
the European and Australian programmes. Under Series K, the
Parent may issue senior debt securities linked to one or more
indices or bearing interest at a fixed or floating rate.
Table 55: Medium-Term Note (MTN) Programs
December 31, 2013
(in billions)
Date
established
Debt
issuance
authority
Available
for
issuance
MTN program:
Series L & M (1) May 2012 $ 25.0 9.4
Series K (1)(3) April 2010 25.0 22.3
European (2)(4) December 2009 25.0 16.7
European (2)(5) August 2013 10.0 10.0
Australian (2)(6) June 2005 AUD 10.0 5.7
(1) SEC registered.
(2) Not registered with the SEC. May not be offered in the United States without
applicable exemptions from registration.
(3) As amended in April 2012.
(4) As amended in April 2012 and April 2013. For securities to be admitted to listing
on the Official List of the United Kingdom Financial Conduct Authority and to trade
on the Regulated Market of the London Stock Exchange.
(5) For securities that will not be admitted to listing, trading and/or quotation by any
stock exchange or quotation system, or will be admitted to listing, trading and/or
quotation by a stock exchange or quotation system that is not considered to be a
regulated market.
(6) As amended in October 2005, March 2010 and September 2013.
Wells Fargo Bank, N.A. Wells Fargo Bank, N.A. is authorized
by its board of directors to issue $100 billion in outstanding
short-term debt and $125 billion in outstanding long-term debt.
At December 31, 2013, Wells Fargo Bank, N.A. had available
$100 billion in short-term debt issuance authority and
$80.1 billion in long-term debt issuance authority. In March
2012, Wells Fargo Bank, N.A. established a $100 billion bank
note program under which, subject to any other debt
outstanding under the limits described above, it may issue
$50 billion in outstanding short-term senior notes and
$50 billion in outstanding long-term senior or subordinated
notes. During 2013, Wells Fargo Bank, N.A. issued $8.9 billion
of senior notes under the bank note program. At
December 31, 2013, Wells Fargo Bank, N.A. had remaining
issuance capacity under the bank note program of $50 billion in
short-term senior notes and $36.6 billion in long-term senior or
subordinated notes. In addition, during 2013, Wells Fargo Bank,
N.A. executed advances of $24.0 billion with the Federal Home
Loan Bank of Des Moines, of which $19.0 billion remained
outstanding at December 31, 2013.
Wells Fargo Canada Corporation In February 2014,
Wells Fargo Canada Corporation (WFCC), an indirect wholly
owned Canadian subsidiary of the Parent, qualified with the
Canadian provincial securities commissions a base shelf
prospectus for the distribution from time to time in Canada of up
to CAD $7.0 billion in medium-term notes. During 2013, WFCC
issued CAD $1.5 billion in medium-term notes using availability
outstanding under its prior base shelf prospectus. In
January 2014, WFCC issued an additional CAD $1.3 billion in
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