Why Wells Fargo Is Circling The Wagons

Culture clashes with First Interstate have slowed a once fleet giant

Not long ago, Wells Fargo & Co. was one of the sleekest--and most profitable--banks around. The San Francisco-based company's cost-conscious management, technological prowess, and streamlined operations were the envy of the industry. Investors, including Warren Buffett, lapped up Wells Fargo stock. The bank's average return on equity in the first quarter of 1996 was more than 28%, vs. 16.5% for the 50 largest banks. "Wells Fargo was really on top of its peer group," says Thomas F. Theurkauf Jr., an analyst at Keefe, Bruyette & Woods Inc. in New York.

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