Wells Fargo is one of the largest banking and financial service providers in the US. However, the company has recently been accused of staggering fake accounts scam, which has put the company in deep trouble. Find the details about the scandal and the SWOT analysis of the company in this presentation.

1. A Case Study Analysis of

2. Overview
• Wells Fargo and Company is a multinational
financial services company, based out of San
Francisco, California.
• It is the fourth-largest bank in the world by
market capitalization.

3. • It is also the fourth-largest bank in the US by
total assets.
• The company was founded in 1852.
• The company provides banking, investment
and mortgage products and services.

4. What Make Wells Fargo One of the
Largest Banks in America?
• Major regional acquisitions:
Wells Fargo was created through a merger of large
regional banks in 1852. It experienced steady growth
over the years. In 1998, it merged with Norwest
Corp. It even bought out East Coast giant Wachovia a
decade later.

5. What Make Wells Fargo One of the
Largest Banks in America?
• Serving the rich and the mass market:
Wells Fargo reported $2.6 billion of net income
wealth management, brokerage and retirement in
2018. At Wells Fargo, “wholesale” is a catch-all for
underwriting, and selling asset-backed securities,
along with other types of banking.

6. What Make Wells Fargo One of the
Largest Banks in America?
• More than just retail banking:
The wholesale banking of Wells and Fargo includes
equipment financing, handling crop insurance,
managing commercial real estate, handling energy
syndicated loans and more. The bank has its
wholesale offices in 42 states

7. What Make Wells Fargo One of the
Largest Banks in America?
• Focus on community banking:
The company's community banking net income was
$10.4 billion on the revenue of $47 billion in 2018.
Community banking is way beyond just ordinary
people depositing their paychecks and perhaps
buying the occasional mortgage.

8. Wells Fargo Fake Account Scandal
• Under pressure to meet sales quotas, bank
employees opened millions of savings and checking
accounts in the names of actual customers without
their knowledge or consent.
• Justice Department officials said that the scheme
was carried out by thousands of Wells Fargo
employees, and it lasted more than a decade.

9. Wells Fargo Fake Account Scandal
• Since the fraud became public in 2016, a torrent of
lawsuits has been filed against the bank.
• In February, 2020, the bank agreed to pay a $3 billion
fine to settle a civil lawsuit and resolve a criminal
prosecution filed by the Justice Department over the
fake account scandal.

10. The SWOT Analysis of

11. Strengths
• Acquisitions:
The series of big, regional acquisitions made by Wells
and Fargo remain to be one of its core strengths over
the years. Thanks to these acquisitions, the customer
base of the company in the US increased to almost
70 million.

12. Strengths
• Business Philosophy:
The company’s business philosophy focuses on five
core values:
 Strong customer focus
 Consideration of people for competitive advantage
 Highest standards of ethics and transparency
 Diversity and inclusion
 Leadership

13. Strengths
• Segment-specific offerings:
The company offers specific services to the three key
segments it caters to.
 Personal
 Commercial
 Small industries

14. Strengths
• Community banking services:
The community banking services remain the most
profitable divisions of the bank. It offers services like
credit cards, bank accounts, debit cards, account
management, loans etc.

15. Weaknesses
• Bank scandals:
The scandal of fake accounts and fraudulent
transactions has hit the company reputation hard.
Once the scandal came out in public, a significant
number of long-standing customers shifted to other
banks. Due to such an incident, the company has
suffered a loss of trust.

16. Weaknesses
• Higher cost:
While Wells Fargo has expanded a lot in the last
decade, the expansion has cost the company
significantly. The bank has faced a lot of costs in its
operations across different financial domains. There
were a lot of legal charges as well due to the scandal.

17. Weaknesses
• Customer relationships:
The company also faced allegations that even though
it claims to be customer-centric, it treats customers
from the higher-income groups differently from the
ones from lower-income groups.

18. Weaknesses
• Limited international presence:
While the company is huge in the US, it has not been
able to make such an impact in the countries. It is
present in nearly 32 countries, but their significance
is quite low outside the US.

19. Opportunities
• Growing immigrant population:
With the increasing population of immigrants in the
US, the company has the opportunity to hire more
diverse people, willing to work, to develop a more
diversified work environment.

20. Opportunities
• Technology-enabled offerings:
Now that almost everyone has access to the internet,
the company has a lot of options to explore. For
example, receiving monthly statements and seamless
money transfer between accounts.

21. Opportunities
• Growth in the commercial banking domain:
The company is already the top mortgage lender and
one of the leading banks in the country. The growth
in the industry of commercial banking brings a lot of
opportunities for the bank.

22. Opportunities
• Growth in smaller towns:
The majority of the operations of the company
happen in cities within the US. It is time to look at
the market outside the US and explore its potentials
in other parts of the word.

23. Threats
• Competition:
The competition in the banking industry gets tougher
with time. Big names like Citibank, Novo Scotia Bank
and the Bank of America are always trying to steal
the clients from Wells Fargo, given a chance.

24. Threats
• Financial unrest:
The whole world is facing a critical financial crunch,
and there has been significant ups and downs in the
financial services industry. This certainly affects the
operations of the bank in the long run.

25. Threats
• Consolidation in the US banking industry:
The steep decline in the number of financial
organizations in the country has worried a lot of
companies. Although it seems to stabilize in recent
years, it calls for consolidation due to the
uncertainty.

26. Threats
• Rising incidents of online scams:
With the new, improved applications of the
technology, the banking sector is also experiencing
an increasing number of online scams, frauds, and
identity theft which is a reason to worry.

27. Conclusion
There's no doubt that there are several elements in favor of
Well & Fargo that allow them to be among the top banking
and financial services in the country.
However, the recent scam has certainly put the company in
deep trouble, causing a significant loss of reputation. The
company still has a lot of opportunities to regain the trust of
its customers.
The SWOT analysis of the company does highlight a number
of areas where the company can work in order to rebuild their
reputation and gain a competitive advantage in the market.

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