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Fortune AIQ 75

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Fortune Global 500

With a combined revenue of $21 trillion and $2.1 trillion in profits, the 2026 Fortune 500 is the definitive list of America's largest companies.

Fortune 500

The 300 companies on this year’s list brought in over $12.5 trillion in revenue for the latest 12 months, with the median revenue figure at $24 billion.

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Fortune AIQ 50

The corporations on our annual list of the world's 500 largest companies combined to generate $41.7 trillion in revenue over the past year.

Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

The corporations on our annual list posted aggregate revenues of $41 trillion for the second year in a row.

Industries included in the sector are banks, insurance, and real estate companies.

Fortune Sector Leaders: Financials

The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

The corporations on our annual list of the world’s largest companies delivered a record $41 trillion in aggregate revenues.

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

F500-2023-047-Wells-Fargo

The fourth biggest bank in the U.S. in terms of revenue dropped six spots on this year’s list amid a tumultuous period marked by rising interest rates. 
<ul> 
 	<li>The bank posted revenues of $82.8 billion for 2022, up 0.5% from the year prior. It accrued $13 billion in profits in 2022, down 38.8% from the previous year.</li> 
 	<li>In May 2023 Wells Fargo paid $1 billion to settle a class action lawsuit in which shareholders accused the bank of overstating its progress toward fixing practices that had gotten it into legal trouble in the 2010s. Most prominent of those scandals was a fake-accounts scheme in which bank employees frequently opened accounts without depositors’ knowledge to meet sales goals.</li> 
</ul>

Aggregate sales hit $37.8 trillion last year—an increase of 19%, the highest annual growth rate in the list’s history.

This year’s Fortune 500 marks the 68th running of the list.

F500 2022-Wells Fargo

Wells Fargo is the third-largest bank in the U.S. by assets, with $1.79 trillion as of February. It serves one in three U.S. households and more than 10% of small businesses in the country. Its stock surged more than 61% in 2021, as Wells Fargo produced a massive $21.5 billion in earnings—fueled in part by a post-pandemic resurgence in lending. But the financial giant continues to labor under a balance-sheet cap imposed by the Federal Reserve after its 2016 fake-accounts scandal. Other legal problems have bubbled up in 2022: In March, Wells Fargo was sued in California for alleged discrimination against Black mortgage borrowers. (The bank has denied that it discriminates in its lending.)

Total revenue for the world’s biggest companies fell 4.8% to $31.7 trillion this year—the first decline in half a decade.

G500 103 Wells Fargo

Wells Fargo continues to experience fallout from its 2016 fake accounts scandal, even five years on. An asset cap imposed in 2018 in response to the bank’s misdeeds prevented the company from taking some deposits during the pandemic. Net income for 2020 slipped to $3.3 billion, compared with $19.5 billion in the year prior. And with a smaller trading and investment banking arm compared with its megabank peers, Wells Fargo also missed out on much of the surge in equities during the year. Still, the bank is seeing a flicker of light: The Fed accepted a proposal to overhaul the bank’s risk management in early 2021, signaling a first step toward lifting the bank’s asset cap. But that comes after Wells Fargo’s continued struggles have worn on investor patience: Warren Buffett’s Berkshire Hathaway, once one of the company’s largest shareholders, culled its holdings by 83% in 2020.

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-37-Wells Fargo

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G500-2020-069-Wells-Fargo

Three years after Wells Fargo's fake accounts scandal erupted, the cleanup continues. There have been countless lawsuits, two CEO exits (three, if you count the departure of an interim leader), and, this February, a new $3 billion fine to resolve further investigations. A $1.95 trillion asset cap on Wells Fargo, imposed by the Federal Reserve in 2018, continues to limit the bank’s growth compared with its peers. Now, CEO Charles Scharf, who joined in October 2019, is tasked with reforming Wells Fargo’s image in the eyes of consumers and regulators alike. Scharf, a former CEO of Bank of New York Mellon, and before that, Visa, is the first top leader brought in from outside Wells Fargo in more than a century; so far he has reorganized reporting lines and brought in more outside executives.

This year's Fortune 500 marks the 66th running of the list.

F500-2020-030-Wells-Fargo

This year's Fortune Global 500 generated $27.7 trillion in revenues and $1.5 trillion in profits.

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Business insiders have spoken: Asked which companies they most admire, more than 4,100 executives, directors, and analysts chose these top 50 All-Stars.

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This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Global business is back. After limping through a worldwide financial crisis and economic slowdown, the 500 largest companies ranked by revenues shattered all sorts of performance records in 2013: They racked up combined revenues of $31.1 trillion, up 2.5% from 2012, and profits soared 27% to nearly $2 trillion. China’s 95 companies (up from 89 last year) posted $5.8 trillion in revenues. The U.S. has four fewer companies on the list than last year but remains (for now) the country leader, with 128 corporations on the list—including No. 1 Wal-Mart Stores—reporting $8.6 trillion in revenues. 

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

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Wells Fargo was among the top six U.S. banks in terms of total assets in 2026. It provides consumer, commercial, corporate, and investment banking services, as well as wealth and investment management.

Q2 2026

Q1 2026

Q4 2025

Q3 2025

Q2 2025

Q1 2025

Q4 2024

Wells Fargo (WFC): Company Profile, Stock Price, News, Rankings

legacy

Wells Fargo

wells fargo

Welcome and thank you for joining the Wells Fargo 4th Quarter 2024 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. Please note that today's call is being recorded. I would now like to turn the call over to John Campbell, Director of Investor Relations.

Good morning. Thank you for joining our call today where our CEO, Charlie Sharp and our CFO, Mike Sanimasimo will discuss 4th quarter results and answer your questions. This call is being recorded. Before we get started, I would like to remind you that our 4th quarter earnings materials, including the release, financial supplement and presentation deck are available on our website at wellsfargo.com. I'd also like to caution you that we may make forward looking statements during today's call that are subject to risks and uncertainties.

Factors that may cause actual results to differ materially from expectations are detailed in our SEC filings, including the Form 8 ks filed today containing our earnings materials. Information about any non GAAP financial measures referenced, including a reconciliation of those measures to GAAP measures, can also be found in our SEC filings and the earnings materials available on our website. I will now turn the call over to Charlie.

Thanks, John. Let me start by acknowledging the unbelievable devastation from the Los Angeles wildfires.

Our hearts go out to everyone who's been affected and we're committed to helping rebuild their lives, businesses and communities. I also want to thank our employees who are working hard to support our customers, many of whom who have been impacted themselves. Turning to Wells Fargo's performance, I'll make some brief comments about our results and update you on our priorities. I'll then turn the call over to Mike to review Q4 results as well as our net interest income and expense expectations for 2025 before we take your questions. Let me start with some general comments.

Our solid performance this quarter taps a year of significant progress for Wells Fargo across multiple areas. Our earnings profile continues to improve. We are seeing the benefit from investments we're making to increase growth and improve how we serve our customers and communities. We maintained a strong balance sheet. We returned $25,000,000 capital to shareholders and we made significant progress on our risk and control work.

We grew net income and our diluted earnings per share was up 11% from a year ago. After I arrived, we reviewed our businesses and sold or scaled back several which reduced revenues in the shorter term and increased investments in others. We also made a conscious effort to diversify revenues and reduce our reliance on net interest income. In 2024, our strong fee based revenue growth of 15% from a year ago largely offset the expected decline in net interest income reflecting these efforts. Our disciplined approach to managing expense levels has been consistent and an important part of our success.

We increased investments in areas that are important for our future and generated efficiencies to help fund those opportunities. Overall, expenses declined from a year ago, benefiting from lower FDIC and severance expenses as well as the impact of our efficiency initiatives, which have helped drive headcount reductions every quarter since Q3 of 2020. We maintained our strong credit discipline and credit performance was relatively stable throughout the year and consistent with our expectations. Average loans declined throughout the year as credit card as growth in credit card balances was offset by declines in most other asset classes, reflecting weak loan demand as well as credit tightening actions. Average deposits grew from Q4 2023 with growth in our deposit gathering businesses enabling us to reduce higher cost CDs issued by corporate treasury.

We've been actively returning excess capital over the past 5 years and that has resulted in average common shares outstanding decreasing by 21% since Q4 2019. This year, we increased our common stock dividend per share by 15% and repurchased approximately $20,000,000,000 of common stock, up 64% from a year ago. Regarding our strategic priorities, I'm very proud of the progress we've made on our risk and control work and it remains our top priority and closing consent orders is an important sign of progress. Early last year, the OCC terminated a consent order it issued in 2016 regarding self practices. The closure of this order was an important milestone and is confirmation that we operate much differently today.

This was the 6th consent order terminated by our regulators since I joined Wells Fargo in 2019. Our operational risk and compliance infrastructure is greatly trained changed from when I arrived. And while we are not done, I'm confident that we will successfully complete the work required in our consent orders and embed an operational risk and compliance mindset into our culture. Our results also show our progress on the other strategic priorities that we have. Improving our credit card platform is an important strategic objective and our progress here is clear.

Since 2021, we have rolled out a total of 11 new cards, including 4 new consumer cards and a new small business card in 2024. Our new product offerings continue to be well received by both existing customers and customers new to Wells Fargo with over 2,400,000 new credit card accounts opened in 2024. We've done this while maintaining our credit standards. The momentum in this business is also demonstrated by strong credit card spend, up over $17,000,000,000 from a year ago. In our auto business, we announced a multiyear co branded agreement where we will be the preferred purchase finance provider for Volkswagen and Audi brands in the United States starting in the first half of this year.

We continued to reposition our home lending business as we execute on the strategic direction we announced in early 2023. We've reduced headcount by 47% and the amount of third party mortgage loan service by 28% since the announcement as we continue to streamline this business. The business is more profitable today and opportunities remain to improve. After several years of little to no growth as we focused on satisfying the requirements of our consent orders, we are starting to generate growth and increased customer engagement in our Consumer, Small and Business Banking segment. We had a more meaningful growth in net checking accounts in 2024 and importantly, most of that growth came in the form of more valuable primary checking accounts.

We had over $10,000,000,000 debit card transactions last year, up 2% from a year ago, the highest annual volume in our history. We accelerated our efforts to refurbish our branches, completing 730 in 2024. We continued to make enhancements to our mobile app, including making it significantly easier to open accounts. And in the Q4 over 40% of consumer checking accounts were opened digitally. We grew mobile active customers by 1,500,000 in 2024, up 5% from a year ago.

Our customers are also increasingly using Zelle and we had over $1,000,000,000 Zelle transactions in 2024, up 22% from a year ago. We introduced Wells Fargo Premier to better serve our affluent clients. We're starting to see some early benefits from the enhancements we've made. We increased the number of Premier bankers by 8% and branch based financial advisors by 5% from a year ago. We focus with a focus on increasing the number of bankers and advisors in top locations.

We have enhanced our customer relationship management capabilities for our bankers and advisors. This has increased collaboration driving $23,000,000,000 in net asset flows into wealth and investment management Premier channel last year. Deposit and investment balances for Premier clients grew steadily throughout the year and increased approximately 10% from a year ago. This remains a significant area of opportunity for us. Turning to our commercial business.

In the commercial bank, we're focused on adding relationship managers and business development officers in underpenetrated and growth markets to drive new client acquisition, future revenue growth and we expect to hire even more in 2025. We created a strategic partnership with Centerbridge Partners and introduced Overland Advisors to better service our commercial bank customers with a direct lending product. We have targeted our investment banking capabilities towards our commercial banking clients. We're still early in these efforts, but we're starting to see results, including our investment banking market share with our commercial banking clients increasing by approximately 150 basis points in 2024, which includes helping some clients access capital markets for the first time. Additionally, we've been working closely with our clients to support their M and A activity, driving higher M and A related revenue.

The opportunity remains significant. We continue to make investments in talent and technology to strengthen corporate investment banking. More than 75 new hires joined CIB since 2019 with many of these in key coverage and product groups within Trading and Banking and our revenue and share in many important areas is increasing, including in our Markets business where we've grown our U. S. Market share, including in credit trading, commodities and our equity cash and derivatives business.

We also continue to make steady progress in growing our FX business with strong growth in both our institutional client base and volumes in 2024. We also grew our U. S. Market share in Investment Banking with share gains in debt and equity capital markets and increased revenue in our advisory business in 2024. We entered 2025 with solid pipeline in both capital markets and advisory, although market conditions can always change.

I feel great about our progress and continue to believe we're just beginning to see the benefits of our investments. We've also continued to exit or sell businesses that are not in sync with our strategic priorities. And last year, we entered into a definitive agreement to sell the non agency third party servicing segment for our commercial mortgage servicing business. More broadly, the U. S.

Economy has performed very well and remained strong and lower inflation and unemployment position the economy well into 2025. We are predominantly a U. S. Bank. We succeed when the country succeeds.

So the incoming administration support of U. S. Businesses and consumers gives us optimism as we look forward. Additionally, the incoming administration has signaled a more business friendly approach to policies and regulation, which should benefit the economy and our clients. Mike will talk more about our expectations for 2025.

But as we start the New Year, I'm enthusiastic about the opportunities we have to drive higher returns across our businesses by growing revenue and managing expenses. I'm proud of the progress we made in 2024. I want to conclude by thanking everyone who works at Wells Fargo, their hard work for what they do every single day to support our customers, clients and communities. I'm excited about the momentum we're building and all that we can accomplish together in 2025. I will now turn the call over to Mike.

Thank you, Charlie, and good morning, everyone. We had solid results in the Q4, including net income of 5,100,000,000 or $1.43 per diluted common share. Underlying business performance was strong compared to a year ago. We grew fee income across most categories, maintained our expense and credit discipline and grew customer counts activity levels as we benefited from the investments that Charlie highlighted. We also grew net interest income from the 3rd quarter.

Our 4th quarter results included $863,000,000 or $0.26 per share of discrete tax benefits related to resolution of prior period matters. This benefit was largely offset by $647,000,000 or $0.15 per share of severance expense and $448,000,000 or $0.10 per share of net losses on the sale of debt securities as we took the opportunity to further reposition a portion of the investment portfolio. This includes the sale of approximately $80,000,000,000 of securities, which we reinvested into higher yielding securities. The estimated payback period for this repositioning is approximately 2.5 years. Turning to Slide 4.

Net interest income grew $146,000,000 or 1% from the 3rd quarter, the first linked quarter increase since the Q4 of 2022. The increase was driven by higher customer deposit balances, which enabled us to continue to reduce higher cost target funding. Moving to Slide 5. Average loans were down from both the 3rd quarter and a year ago. Period end balances grew $3,000,000,000 from the 3rd quarter with growth in commercial and industrial loans and credit card loans more than offsetting declines in most other categories.

Average deposits increased both from the 3rd quarter and a year ago with growth in our customer deposits enabling us to reduce higher cost of corporate treasury deposits. Average deposit cost declined 18 basis points from the 3rd quarter as deposit cost stabilized or declined across all of our deposit gathering businesses. In response to the Federal Reserve rate cuts, we have reduced standard pricing for commercial clients as well as pricing for promotional deposit offers and CDs in our consumer businesses. Lower deposit costs also reflected the slowdown of customer migration to higher yielding deposits. Additionally, lower cost consumer deposit balances and checking and savings accounts have continued to stabilize.

Turning to Slide 6. We had strong growth in non interest income, up 11% from a year ago benefiting from the investments we've been making in our businesses as well as market conditions. This growth was diversified with each of our operating segments generating growth from a year ago. I'll highlight the specific drivers of non interest income when discussing our operating segment results. Turning to expenses on Slide 7.

Non interest expense declined 12% from a year ago driven by the lower FDIC special assessment. Excluding this assessment, expenses were relatively stable as lower severance expense and the impact of our efficiency initiatives was largely offset by higher revenue related compensation, predominantly in wealth and investment management as well as higher technology and equipment expense. Turning to credit quality on Slide 8. Credit performance has been relatively stable with our net loan charge off ratio the same as a year ago and up 4 basis points from the 3rd quarter. Commercial net loan charge offs increased $80,000,000 from the 3rd quarter to 30 basis points of average loans driven by the commercial real estate office portfolio.

Commercial real estate office fundamentals have not changed and remain weak. We still expect commercial real estate office losses to be lumpy as we continue to actively work with our clients. Consumer net loan charge offs increased $20,000,000 from the Q3 to 85 basis points of average loans driven by higher losses in the credit card portfolio, which was consistent with our expectations. Non performing assets declined 5% from the 3rd quarter, driven by a $390,000,000 decline in commercial real estate office non accrual loans, which includes pay downs and net loan charge offs. Moving to Slide 9.

Our allowance for credit losses from loans was down $103,000,000 from the 3rd quarter with modest declines across most asset classes, partially offset by the increase in allowance for credit card loans driven by higher loan balances. Our allowance coverage for total loans has been relatively stable over the past 5 quarters as credit trends have remained fairly consistent. Our allowance coverage for our corporate and investment banking commercial real estate office portfolio increased 12% as loan balances continued to decline and allowance levels were relatively stable. Turning to capital and liquidity on Slide 10. Our capital position remains strong and our CET1 ratio of 11.1% continues to be well above our CET1 regulatory minimum plus buffers of 9.8%.

We've repurchased $4,000,000,000 of common stock in the Q4 and approximately $20,000,000,000 for the year, reducing common shares outstanding by 9% from a year ago. Turning to our operating segment starting with Consumer Banking and Lending on Slide 11. Consumer Small and Business Banking revenue declined 7% from a year ago, driven by lower net interest income, reflecting the impact of customers migrating to higher yielding deposit products. However, the pace of the migration continues to slow. Home lending revenue grew 2% from a year ago driven by higher mortgage banking fees.

Credit card revenue grew 3% from a year ago as loan balances increased and card fees grew from a higher point of sale volume. We continue to be pleased with the performance of new products that we launched over the last three and a half years with credit performing as expected and strong growth in new accounts and usage. Auto revenue decreased 21% from a year ago driven by lower loan balances reflecting previous credit tightening actions and continued loan spread compression. The decline in personal lending revenue from a year ago is also driven by lower loan balances and loan spread compression. Turning to some key business drivers on Slide 12.

Retail mortgage originations increased 31% from a year ago with higher purchase volume as well as stronger refinance volume early in the quarter when interest rates were lower. Debit card spending was strong in the 4th quarter and increased $4,900,000,000 or 4% from a year ago and credit card spending was up 9% from a year ago with growth in all categories except fuel. Turning to Commercial Banking results on Slide 13. Middle Market Banking revenue was down 2% from a year ago driven by lower net interest income reflecting higher deposit costs, partially offset by growth in treasury management fees. Asset based lending and leasing revenue decreased 12% from a year ago, driven by lower net interest income and lease income, partially offset by improved results from our equity investments.

Average loan balances in the 4th quarter were down 1% compared with a year ago as growth in middle market banking was more than offset by lower balances in asset based lending. While our commercial clients are generally more optimistic, we did not see a meaningful change in loan demand in the 4th quarter as many clients remain cautious. Turning to Corporate and Investment Banking on Slide 14. Banking revenue was down 4% from a year ago driven by higher deposit costs and lower loan balances. This decline was partially offset by higher investment banking revenue from increased activity in in Equity and Debt Capital Markets as well as higher advisory fees.

Commercial Real Estate revenue decreased 1% from a year ago reflecting the impact of lower loan balances partially offset by higher capital markets revenue from higher volumes in commercial mortgage backed securities, real estate loan syndications and multifamily capital as market sentiment improved. Markets revenue was down 5% from a year ago driven by lower revenues in equities and municipals, partially offset by stronger performance than most other fixed income products. Our 4th quarter results reflected the implementation of a change to incorporate funding valuation adjustments for our derivatives, which resulted in a loss of $85,000,000 The decline from the Q3 was also driven by seasonally lower trading activity across most asset classes. Average loans declined 6% from a year ago, driven by continued reductions in our commercial real estate portfolio, driven by office as well as lower loan balances in banking as clients continue to access capital markets for funding. On Slide 15, Wealth and Investment Management revenue increased 8% compared with a year ago due to higher asset based fees, driven by increased market valuations.

As a reminder, the majority of Wynn advisory assets are priced at the beginning of the quarter, so first quarter results will reflect market valuations as of January 1, which were about from both a year ago and from October 1. Average deposits increased by 16% and average loans grew by 2% from a year ago, which have both benefited from product enhancements and pricing improvements that provide value to our clients. The growth in deposits also reflected the slowdown in migration of cash alternatives with balances in those products lower than a year ago. Slide 16 highlights our corporate results. Revenue increased from a year ago driven by improved results from our venture capital investments.

After having impairments on these investments for the past 2 years, we had net gains every quarter in 2024 with improved performance in the second half of the year. Now turning to our outlook on Slide 17. I'll go into more detail on our 2025 expectations for net interest income and non interest expense in the next few slides. But first, I want to highlight the progress we've made on improving our returns. When we first started discussing the outlook for our returns in the Q4 of 2020, we had an 8% ROTCE.

Over the past 4 years, we have been successfully executing on our efficiency initiatives, diversifying our sources of revenue by investing in our businesses to better serve our customers and drive growth and returning excess capital to shareholders. These actions helped to improve our ROTCE to 13.4% in 2024. We still believe we have an achievable path to a sustainable ROTCE of 15% as we continue to make progress on transforming the company including the priorities highlighted earlier on the call. On Slide 18, we provide our expectations for net interest income for 2025. We had $47,700,000,000 of net interest income in 2024, which was within the expected range we provided at the start of last year.

Net interest income declined sequentially for the 1st 3 quarters of the year before growing modestly in the Q4. Our 4th quarter annualized net interest income was $47,000,000,000 or approximately $700,000,000 lower than full year 2024. Our current expectation is that full year 2025 net interest income will be approximately 1% to 3% higher than full year 2024 or approximately 3% to 5% higher than the annualized Q4 of 2024 net interest income. We expect net interest income will be relatively stable in the first half of twenty twenty five, which includes the impact from 2 fewer days in the Q1 with more growth in second half of the year. Underpinning our expectations are a series of key assumptions including using the recent forward rate curve, which includes between 12 reserve rate cuts, given our modestly asset sensitive position, this will be a slight headwind to net interest income.

Average loans are expected to grow modestly from Q4 2024 to Q4 2025, driven by anticipated growth in the Corporate Investment Bank Markets Group and CIB Banking, as well as anticipated growth in our auto and credit card portfolios. Deposits in all our deposit gathering businesses are expected to grow modestly, which would allow us to further reduce higher cost market funding. Reinvestment of lower yielding securities into higher yielding assets. Our expectation also reflects the benefits of the actions we took in the second half of twenty twenty four to reposition the investment portfolio and trading related net interest income is expected to be higher due to lower interest rates, which would largely be offset by lower trading related non interest income. As we've done in prior years for the purposes of estimating net interest income, we are also assuming the asset capital remain in place throughout the year.

Ultimately, the amount of net interest income we earn in 2025 will depend on a variety of factors, many of which are uncertain, including the absolute level of interest rates, the shape of the curve, deposit balances, mix and pricing and loan demand. Now turning to our 2025 expense expectations on Slide 19. Following the waterfall on the slide from left to right, we reported $54,600,000,000 of non interest expense in 2024, which includes the $647,000,000 of severance expense in the Q4 that was not contemplated in our guidance. Our 2025 expense expectation includes operating losses of approximately $1,100,000,000 which is approximately $700,000,000 lower than operating losses in 2024. Looking at the next bar, we expect severance expense to be approximately $500,000,000 lower in 2025 given the expense accrual we took in the Q4 of 2024.

We expect Wealth and Investment Management revenue related expenses to increase by approximately $600,000,000 in 2025. As a reminder, this is a good thing as these higher expenses are largely offset by higher non interest income. Actual revenue related expenses will be a function of market levels with the biggest driver being the equity markets. Our outlook assumes the S and P 500 will be up modestly at the current levels, but clearly the ultimate performance of the markets is uncertain. We expect all other expenses to be up approximately $200,000,000 with the impact of efficiency initiatives more than offset by higher investments and other expenses.

We expect approximately $2,400,000,000 of gross expense reductions in 2025 due to efficiency initiatives. We've successfully delivered on more than $12,000,000,000 of gross expense saves since we started focusing on efficiency initiatives 4 years ago and we continue to believe we have opportunities to get more efficient across the company. Keep in mind, however, the resources needed to address our risk and control work are separate from our efficiency initiatives. There are 3 primary areas where we're expected to invest. First, we expect approximately $900,000,000 of incremental technology expense, including investments in infrastructure or business capabilities.

2nd, we expect approximately $900,000,000 of incremental other investments, including the specific areas we highlight on the next slide. Finally, we expect other expenses to increase by approximately $800,000,000 including expected merit increases and performance based discretionary compensation. As a reminder, the Q1 has seasonally higher personnel expenses, which are expected to be $650,000,000 to $700,000,000 Putting this all together, we expect 2025 non interest expense to be approximately $54,200,000,000 On Slide 20, we provide some examples of our areas of focus for the investments, which are critical to better serving our customers and generating growth. Let me highlight a few. Building the right risk and control infrastructure remains our top priority and we will continue to invest in this important work.

We continue to invest in technology and digital platforms to transform how we serve our both our consumer and commercial customers. This includes continuing the transition of our applications to the cloud, migrating into new data centers and investing in data platforms to drive more insights. We are continuing to upgrade our core lending capabilities, including improvements to our fulfillment and servicing systems, enhancing credit decisioning and strengthening fraud capabilities. To drive customer growth in the consumer businesses, we plan to continue scaling our marketing efforts, modernizing our branch footprint and increasing the number of premier bankers and financial advisors. We are also focused on onboarding more independent advisors as we continue building out our independent brokerage channel.

In addition, we continue to improve our digital capabilities for our customers, specifically our mobile account opening and onboarding as well as Zelle.

priority sectors to help drive growth in Investment Banking Capital Markets. We also plan to continue hiring relationship bankers within Commercial Banking to build out coverage in underpenetrated markets in key industries. In summary, our results in 2024 demonstrated the continued progress we've been making to improve our financial performance. We generated strong fee based revenue growth, reduced our expenses, maintained strong credit discipline, increased capital returns to shareholders and returned retained our strong capital position. I'm very pleased with the progress we've made so far.

I'm excited about the additional opportunities we have to continue to drive improved performance. We will now take your questions.

At this time, we will now begin the question and answer session. Our first question comes from John McDonald of Truist Securities. Your line is open.

Mike, I was hoping you could unpack, the deposit expectations embedded in Slide 18 in the NII outlook. You talked about stabilization of retail volumes and mix. Just kind of wanted to get a little more detail about what you're assuming for retail deposit growth mix and how that plays into the pay down of higher cost borrowings throughout the year in your plan?

Yes, sure. Thanks, John. And welcome back to

Look, I think as we've sort of talked about now, I guess, for the last 3 or 4 quarters, we've been seeing less and less migration out of non interest bearing to interest bearing. You got to look through some of the product consolidations we did in the Q3. So there's some noise there that we talked about last quarter. But so we've seen continued sort of stabilization of the mix between non interest bearing and interest bearing. And so that's sort of helpful as you go into this year.

And we expect that to continue as we look forward and then start to see absolute growth across the consumer franchise. As you know, in the interest bearing products and the consumer side, pricing hasn't really moved much through the cycle. And so you're not seeing standard pricing change much, but you are seeing the promotional savings and CD rates continue to come down over the last 90, 120 days as rates have started to move. And so we would expect that mix to stabilize. We expect some absolute growth and we don't expect pricing pressure to come through on the consumer side.

Okay. Got it. And then just wanted to shift gears and ask about credit card profitability. When you're in growth mode, credit card experience is a drag from accounting on the upfront acquisition costs and provision. Where are you on card profitability now?

Is that an upside driver to ROE as more of the balances roll off teasers and some of that upfront expense wanes?

Yes, certainly is. I think as you look backwards a little bit, we started launching the new products three and a half years ago. So the first of the vintages came on starting in August July, August a few years ago. And so we're just starting to kind of see those earliest vintages mature and become more profitable. So we're still early days in terms of seeing that profitability really come through in the P and L.

I'd say, obviously, the factors you got to think about as you sort of look through that is the credit box and the credit performance. That's all behaving right on top of what we would have modeled. So we're not seeing any concerns flow through from what we modeled across all of the different new products. And we're seeing as Charlie highlighted in his script, we're seeing good new account growth continue across the different products there. And so it's just a matter of time for that to really sort of more meaningfully come into the P and L.

It really hasn't contributed much at all yet as you sort of look at it, but it will start to come through over the next year or 2.

And John, this is Charlie. The only thing I would add, I mentioned this in my prepared remarks, but the two places that we think of is where we've already taken actions and assist execution now which will improve profitability. 1 is card as you pointed out. And the second I referenced is we're still not at the level of profitability where we should be in home lending.

Just given as we continue to wind down that servicing book. And so we think those two things will be helpful for us as we look forward.

The next question will come from Ebrahim Poonawala

Hey, good morning. I guess I just wanted to go back maybe Charlie to something you talked about back in December on the back of the lifting of the OCC consent order. As we think about just the ROE trajectory for the bank, it will be useful if you can maybe give some tangible examples of things that you've been able to do post the lifting of that consent order in terms of incenting branch employees? And where in the balance sheet or in the P and L we should expect that to show up maybe as early as 2025?

Yes. Ebrahim, it's Mike. Maybe I'll start and Charlie can chime in if he wants to add. I think what you're referencing just to make sure everyone's clear is the sales practices consent order that got lifted last February. As part of the work we had to do when that came on, we dialed back much of what you would expect to see in the branch system around incentive plans and sales goals and the like and to make sure that we built rebuilt the control framework and all of those things that we would do there in a way that would make sure that the problems of the past don't reoccur.

And so as we saw that concentrator go away, we've been able to more fully roll out a standard sort of incentive framework across the branches. We have been piloting it for a while in a small subset. And as you would expect, you would see different performance and better performance in those pilot branches. And that's across new checking growth, credit card accounts and the like. And so we're still in the early days to see the benefits of that system be put in place because it got rolled out as throughout 2024.

And so we would expect to kind of see the results start to come through more meaningfully over the near term, medium term.

Maybe just a little more color to what Mike said. I think again if you think back that was hugely important that we satisfied the obligations that existed in that consent order and that we were comfortable with the control environment that existed. And so, we took away, as Mike said, a whole series of things. It's not just one thing, it was compensation, it's reporting, goals, just the whole way we manage the system.

As we were building out everything that would make us and our regulators comfortable as we managed the system in the future similar to the way other people manage their system that if something if someone were to be doing something that wasn't appropriate that we had the right controls and reporting in place to cash it. So it took a long time to build that out, but to have the confidence that we could add back a lot of these management mechanisms that you have in place. And so, no one individual thing is earth shattering. But when you take compensation, when you take reporting, when you take management routines, when you take all those things and put them together, at the same time, you're monitoring all the controls that you've built. That's what gives us the confidence to go forward with the system that we think can attract more customers and do more with our existing customers.

But within a very tightly controlled framework that we feel comfortable relative to how we manage the risk that's there.

And Ebrahim, I'd say, Charlie and a lot of other folks here have seen this before and we're confident we're going to get the results we think out of it.

That's helpful color. Thanks for that. And I guess just maybe following up, So thanks Mike for running through the expense investment priorities. As we think about the severance charge in the Q4 and runway to extract additional efficiencies relative to your $54,000,000,000.2 expense guide, How should we think about like are we getting to a point where some of the low hanging fruit is done and expenses generally move higher given the investments and we should at least anticipate positive operating leverage on the way forward? Or do you still see opportunities to meaningfully cut costs, make things more efficient, especially in the consumer bank?

Yes. I think Ebrahim as we sort of look at what you see there and what we're doing in 2025, it's no different than the thinking is no different than it's been now for the last 4 or 5 years that we've both been here. I think as you look at the company, we still feel like there's a significant amount of opportunity to drive efficiency and that's what you see in 2025. And I know we've used this analogy a lot, but it is just like peeling an onion. And as you sort of look at the next layer down, you find more efficiency, you bring better technology, you bring better automation, which by the way saves us money, but also in a lot of cases improves the client experience for our customers.

And so we as we come in every day, we still think about it the same way that we've been thinking about for a while and that's what you see in the expectations for this year.

The next question comes from John Pancari of Evercore. Your line is open.

On the 2020 on the NII outlook, I know you said it includes modest loan growth expectation for 2025. I just want to see if you can elaborate a little bit on how we could think about that in terms of level and trajectory. Should it be near GDP?

Or how should we think about that? And then can you in addition to the maybe sizing up the most likely drivers, maybe can you also give us a little bit of color on the pace of expected incremental runoff of balances as we look at the growth outlook? Thanks.

Yes. So maybe I'll start on the loan side. So as I said in my commentary like we're expecting to see a little bit more of it as we get to the middle and second half of next year. So we may see a little bit in the first half, but it's not it will be more meaningful as we go later in the year. I would think of it as like low to mid single digits depending on the category of loans, but obviously some of that will be dependent upon the overall backdrop that we're in.

As you look at the consumer side of the picture, mortgages will likely continue to decline a little bit given sort of the rate environment we're in. We did see a little bit of incremental refinance activity in the Q4, but now with rates back up that seems to be back down again. We should see some card growth as we go through the year. And we should start to see some growth in the auto portfolio as well. On the commercial side, some of it will be new account growth new client growth as we go through the year.

We've been adding bankers across different categories. We do expect to see some growth in the markets business as well that drives some loan growth. And so it should come from a lot of a little bit from a lot of different areas across the population, but I would expect to see that a little bit more as we go into middle and second half of the year.

Great. Thanks, Mike. And then separately on capital, 11.1 percent CE T1, pretty solid and you still bought back about $4,000,000,000 this quarter. How should we think about the buyback appetite as you look at 2025? Assuming that you do see some improvement in organic growth opportunities, how could that influence your pace of buyback?

Thanks. Yes. I mean, look it's the standard sort of waterfall of decision making that goes into it, right? If we've got good organic growth opportunities across loans and other categories, we're going to to serve customers that's always first. We still have the asset cap in place.

So there's some limits to that. We'll look at all the different risks that are out there across the different categories of items that we got to be concerned about. And then buybacks will kind of be the rest. And given we've got the asset cap and given we've got limited organic growth that depending on the quarter you're in, I think you'll see us continue to return capital back to shareholders like we've done now for the last number of years. At this point, we don't believe we need to be higher than where we are from a CET1 percentage.

And so we'll manage that based on those opportunities and those decisions that we talked about.

The next question comes from Erika Najarian of UBS. Your line is open.

Hi, good morning. Clearly, the way the stock has reacted, the message from your shareholders has been an embrace of Wells Fargo is more than a remediation story. And thinking about the return improvement even beyond the asset cap resolution and the consent order. And I guess to that end, Charlie and Mike, you have a medium term ROTI target of 15%. In 2024, you generated almost 13.5%.

And by your own commentary, you still have places like card and home lending where your profitability should improve from here. You're carrying excess capital. You're under the asset cap. Obviously, you're making great efforts in CIB in terms of really using your balance sheet to generate even more fees and off of your relationships as well. And as we think about that 15%, especially in the context of you have one money center that has to hold more capital than you that has a 17% target and another money center that has to hold more capital than you and has a 15% target.

I guess I'm wondering if your shareholders are thinking about fully realized wells beyond the remediation story. What is the true natural return of this business?

Wells Fargo (WFC) Q4 2024 Earnings Call Transcript

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