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Durbin Amendment forcing Wells Fargo to shut down some branches

Tim Sloan

Wells Fargo & Co. is considering closing some branches and turning them into mortgage and brokerage offices in an effort to minimize costs and replace lost revenue resulting from the Durbin Amendment.

“There are obviously some regulatory issues that you need to be mindful of when you combine a securities business and a deposit-taking business,” Wells Fargo CFO Timothy Sloan told analysts, according to Investment News. “But, from time to time, we are clearly going to look at opportunities to consolidate.”

Wells Fargo’s CEO John Stumpf said that the company plans to cut $1.5 billion in quarterly costs by the end of the year. Sloan reiterated the goal but said that first-quarter expenses will likely remain elevated. The bank acquired Wachovia in 2008 and has converted the former Wachovia holdings to Wells Fargo establishments, totaling 6,239 retail branches, 1,375 retail brokerage offices and 725 mortgage locations at the end of 2011, according to Investment News.

Wells Fargo & Co. recently passed Bank of America Corp. as the largest U.S. network of outlets. The bank now has the largest market value of U.S. lenders at $160 billion. Wells Fargo also ranks first in home and mortgage lending, and its retail brokerage division ranks third.

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