Kent McClun knows Wells Fargo is the fourth largest bank in the United States. But that doesn’t stop him from marketing his company as a community lender in Connecticut.
McClun, who is Wells Fargo’s community bank president in the Nutmeg State, said despite the size and reach of the $1.2 trillion financial services giant, it wants to be thought of as a local lender.
“Each store has a run-it -like-you-own-it attitude,” said McClun, adding that Wells Fargo calls its branches “stores,” to convey more of a retail outlet-like setting. “Our motto is, ‘out local the nationals,’ and also ‘out local the locals’. That’s always been our mindset.”
That strategy appears to be working so far. After acquiring Wachovia Bank at the height of the financial crisis in 2008, Wells Fargo has found a sweet spot in Connecticut, increasing its market share over the past few years and looking to take on competitors both large and small.
Among the 10 banks with the largest deposit base in Connecticut, Wells Fargo had the second biggest increase in market share in 2010, growing to $8.3 billion in deposits, an 18 percent increase from a year earlier. The company is the fourth largest bank in the state owning 8.63 percent of the market, behind Bank of America, Webster Bank and People’s United Bank.
The growth comes as the bank finally retires the Wachovia name and signs, replacing them with Wells Fargo’s own distinctive red and gold brand.
Wachovia’s transition to Wells Fargo, which began in December 2008, has resulted in the hiring of 150 additional tellers and bankers in Connecticut. The company is also offering a wider array of financial products and services, all part of the strategy to create that community banking model, McClun said.
Wells Fargo now employs 1,503 people in the state.
McClun, a former Iowa banker, said Wells Fargo’s goal is to capture all segments of the market, ranging from low to high income earners in the consumer market, and small businesses to large corporations in the commercial sector.
But the bread and butter of the company is small business lending, McClun said.
“Our focus is on business, especially small business,” McClun said.
McClun said there is still a lot of hesitation among borrowers, and underwriting standards still remain tighter than pre-financial crisis times. But the bank is seeing more loan approvals recently.
“We are open and lending,” McClun said.
In terms of the transition, McClun said Wells Fargo decided to take a slow and methodical approach to cut down on any hiccups in the process.
Prior to the Connecticut transition, Wells Fargo performed name changes and computer system mergers in 13 states where Wachovia had a presence. The rest of the change over, mostly along the east and southeast coast, is expected to be completed by the end of this year.
The biggest challenge, McClun said, has been the size and scope of the effort including the training and development of former Wachovia team members on new systems and product offerings.
Marketing officials say the rebranding effort should serve Wells Fargo well.
“Wachovia as a brand has disappeared with all its negative baggage,” said Bill Field, president of Mintz & Hoke Communications Group in Avon. “It is no longer in the consciousness of any consumers. Wells Fargo is a new financial entity for many.”
Field, whose firm has no banking clients, said for Wells Fargo to continue to gain market share it will need to establish a brand foothold by going beyond previous Wachovia customers and carve out a “distinctive position and identity in a very crowded category.”
In terms of a big bank trying to position itself as a community lender, Field said the jury is still out if that can be successful.
“It depends on whether they can pay off the notion of being local,” Field said. “The very name Wells Fargo connotes an image of the West — certainly not an East Coast vision. They’re competing against community banks that do it well in this region. It goes far beyond ‘branding,’ it’s all about the actions they take on the local level. How immersed their brand influences become in the community will be the ultimate test.”
McClun said part of the strategy to create that local connection includes Wells Fargo stepping up its charitable contributions. The bank has set aside $80,000 that will go to a variety of Connecticut organizations.
As part of the changeover, which began March 12, the company’s 74 banking stores and 99 ATMs are being rebranded Wells Fargo. All of the 74 stores are also being remodeled and refurbished. Each store will also have an online banking station, and many stores will feature murals depicting community history, produced in conjunction with local historical societies.
