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Public Meeting Transcripts

Public Meeting Regarding Norwest Corporation and Wells Fargo & Company

Thursday, September 17, 1998

Transcript of Panel Ten

                                                            201
 

 
         24                  CHAIRPERSON SMITH:  We're ready to
 
         25        start with Panel 10.  I think you can sit
 
 
 
 
 

 
 
                                                              202
 
          1        anywhere.  I'll call you in the order that you
 
          2        appear, but you may sit anywhere.
 
          3             Okay.  Again, a reminder that if the five
 
          4        minutes expire before you have finished your
 
          5        statement, we will include the -- your complete
 
          6        statement in the record, if you will make sure
 
          7        that we have a copy of it at the registration
 
          8        desk.  So if they don't have one now, make sure
 
          9        that they have one before you leave.  And we'll
 
         10        start with Mr. Cody.
 
         11
 
         12                  MR. CODY:  Well, thank you.  I'm Ron
 
         13        Cody, President of Junior Achievement of the
 
         14        Upper Midwest.  And I appreciate the opportunity
 
         15        to speak on behalf of Norwest Bank and share our
 
         16        views on the impending merger.  Norwest Bank's
 
         17        commitment to youth and education we feel is
 
         18        exemplified by their very extensive involvement
 
         19        with the organization I represent, Junior
 
         20        Achievement, throughout our assigned geographic
 
         21        territory, which includes the States of
 
         22        Minnesota and North Dakota and, incidentally,
 
         23        four boarder counties in Wisconsin.
 
         24             So that you know what we do to refresh you,
 
         25        Junior Achievement's purpose is to educate and
 
 
 
 
 

 
 
                                                              203
 
          1        inspire young people, to value free enterprise,
 
          2        business and economics, to improve the quality
 
          3        of their lives.  And Junior Achievement's
 
          4        mission is to insure that every child in America
 
          5        has a fundamental understanding of our free
 
          6        enterprise system.  And Norwest Bank is a
 
          7        natural and valued partner in those endeavors.
 
          8        During the school year just underway,
 
          9        partnerships with various sponsoring
 
         10        organizations both in the private and public
 
         11        sector, and including Norwest, will result in
 
         12        75,000 students meeting weekly in their
 
         13        classrooms with over 3,000 volunteers who will
 
         14        transform textbook theory into real-life
 
         15        situations and, in the process, persuade young
 
         16        people of the critical importance of education.
 
         17        And as a very conscientious corporate citizen,
 
         18        Norwest has played a critical role in this area
 
         19        by actively encouraging and supporting
 
         20        employees' weekly visits to area classrooms to
 
         21        work with students and deliver the Junior
 
         22        Achievement curriculum.  The primary thrust of
 
         23        Norwest's involvement with JA is financial
 
         24        education.  At the elementary, middle and senior
 
         25        high grade levels, Norwest employees make
 
 
 
 
 

 
 
                                                              204
 
          1        personal and business finance come alive for
 
          2        students.  And are they making an impact?
 
          3        Absolutely.  We know that by not only local
 
          4        surveys and evaluations, but national studies
 
          5        done by outside evaluation firms.
 
          6             Last school year, 146 Norwest Bank
 
          7        Minnesota employees contributed 1,022 hours of
 
          8        time in classrooms teaching finance and
 
          9        economics to approximately 4,370 students K
 
         10        through 12.  That took place in 168 Metro area
 
         11        classrooms.  Norwest banking officials have
 
         12        indicated to us they fully expect the number of
 
         13        volunteers to increase during the current and
 
         14        subsequent school years.
 
         15             In addition, various Norwest banking sites
 
         16        arrange with Junior Achievement to host
 
         17        approximately 200 area students in a
 
         18        finance-related career-oriented job shadow
 
         19        experience on site in the banks during spring of
 
         20        last year.  And we will -- we anticipate they
 
         21        will provide a similar opportunity this year for
 
         22        young people to see what goes on in those tall
 
         23        buildings and encourage them to develop the
 
         24        marketable skills they'll need to work in those
 
         25        buildings.
 
 
 
 
 

 
 
                                                              205
 
          1             In addition to all of this, Norwest Bank
 
          2        Minnesota is a major financial supporter of
 
          3        Junior Achievement.  And this financial support
 
          4        provides the funds for the classroom materials,
 
          5        the textbooks, the workbooks that are provided
 
          6        to the schools and the students at no cost.  And
 
          7        this is in the seven-county Metro area alone.
 
          8        Norwest Bank Minnesota financially supports JA
 
          9        programs in many communities throughout
 
         10        Minnesota, provides volunteers, financial
 
         11        support and serves on the boards in Duluth,
 
         12        Mankato, Moorhead, Brainerd and in North
 
         13        Dakota -- several communities in North Dakota as
 
         14        well.  Norwest Bank Minnesota's management has
 
         15        been represented on the Junior Achievement Board
 
         16        of the Upper Midwest, the corporate board, for
 
         17        45 consecutive years.  And Jim Campbell and Pat
 
         18        Donovan have both served on the Junior
 
         19        Achievement Board and have personally
 
         20        volunteered time with the Junior Achievement
 
         21        programs.
 
         22             In closing, I want to -- in speaking for
 
         23        our Board of Directors and our staff, the staff
 
         24        of Junior Achievement of the Upper Midwest, we
 
         25        regard Norwest Bank Minnesota as the ideal
 
 
 
 
 

 
 
                                                              206
 
          1        corporate citizen in light of Norwest's
 
          2        long-term, demonstrated commitment to community,
 
          3        to young people, to education.  And we're proud
 
          4        to say to Junior Achievement, "We're absolutely
 
          5        confident of Norwest's continued commitment to
 
          6        this community following a merger regardless of
 
          7        where the headquarters is located.  In fact, at
 
          8        Junior Achievement, we view a larger, stronger
 
          9        banking organization as being able to generate
 
         10        additional resources that can, in turn, be
 
         11        reinvested in the local communnities in various
 
         12        ways, and including organizations like Junior
 
         13        Achievement.  Again, we appreciate the
 
         14        opportunity to share our views with you.
 
         15                  CHAIRPERSON SMITH:  Thank you.
 
         16        Mr. Cramer?
 
         17
 
         18                  MR. CRAMER:  Good afternoon.  My name
 
         19        is Steve Cramer.  I'm the Executive Director of
 
         20        Project for Pride in Living.  We are a Twin
 
         21        Cities area nonprofit working on community
 
         22        redevelopment inner city neighborhoods.  I
 
         23        appreciate the opportunity, as well, to express
 
         24        to you our confidence that our long-standing,
 
         25        multifaceted relationship with Norwest in our --
 
 
 
 
 

 
 
                                                              207
 
          1        in helping us accomplish our mission of
 
          2        revitalizing inner city communities will
 
          3        continue and be strengthened in the future under
 
          4        this proposed merger.
 
          5             I'd like to just very briefly reflect on
 
          6        the many ways in which we interact with Norwest
 
          7        to accomplish this mission of inner city
 
          8        revitalization.  One way is through the
 
          9        financing that is extended by Norwest to low
 
         10        income buyers of single-family homes that we
 
         11        construct or renovate in inner city
 
         12        neighborhoods.  Norwest is a consistent and
 
         13        reliable lender for our buyers, all of whom are
 
         14        low income, 80 percent of whom are people of
 
         15        color, including buyers from emerging ethnic
 
         16        communities in the Twin Cities, new Americans.
 
         17        And their CHOP product in particular extends
 
         18        affordability to very low-income buyers and is a
 
         19        very effective tool for promoting ownership in
 
         20        inner city neighborhoods.
 
         21             Norwest also services loans in programs
 
         22        that we administer in communities and
 
         23        neighborhoods throughout the Twin Cities.  And I
 
         24        must say that in many neighborhoods that we work
 
         25        with, the request is specifically that we
 
 
 
 
 

 
 
                                                              208
 
          1        partner with Norwest for loan servicing because
 
          2        of the high degree of customer service that
 
          3        their local branch banks throughout the Twin
 
          4        Cities and neighborhoods that we work in offer
 
          5        to area residents.
 
          6             As Ron indicated, Norwest extends its
 
          7        professional expertise to community development
 
          8        work through their active participation in our
 
          9        board and committees that we have overseeing our
 
         10        various programs in housing, employment and
 
         11        training, education and human services.  They
 
         12        provide technical assistance to our staff in
 
         13        areas including residential finance,
 
         14        underwriting of our various development projects
 
         15        and even occasionally helping us work out some
 
         16        of the problems that our projects run into.  And
 
         17        as much as is money, whether it's financing or
 
         18        grant funds through the foundation, that
 
         19        extension of professional expertise into the
 
         20        community is extremely valuable in the work that
 
         21        we do.
 
         22             Norwest has also sponsored for us
 
         23        applications to the Federal Home Loan Bank that
 
         24        has resulted in affordable housing program
 
         25        grants to projects that we have been involved
 
 
 
 
 

 
 
                                                              209
 
          1        in; most recently, a project called Anishinabe
 
          2        Wakiagun, which you, perhaps, heard about from
 
          3        an earlier panel, a project that houses homeless
 
          4        chronic inebriates in the poorest neighborhood
 
          5        in the City of Minneapolis.  We have partnered
 
          6        with Norwest to our mutual benefit in trying to
 
          7        place hard-to-employ men and women that we work
 
          8        with, especially through our Welfare to Work
 
          9        Program, in their operations center meeting both
 
         10        their employment need, but also providing an
 
         11        effective outlet for our employment placement
 
         12        efforts and then working together to make that
 
         13        employment placement successful.  And then also,
 
         14        their foundation has been quite supportive of
 
         15        all of our programming areas; housing,
 
         16        employment training, self-sufficiency services
 
         17        and education.  Norwest was the single largest
 
         18        giver to our recently established endowment for
 
         19        our self-sufficiency program.  And their most
 
         20        recent gift will support our efforts in
 
         21        improving educational achievement in many of the
 
         22        inner city neighborhoods that we -- that we live
 
         23        in.  So across these many dimensions, our
 
         24        partnership with Norwest has been effective,
 
         25        long-standing, focused on the poorest and lowest
 
 
 
 
 

 
 
                                                              210
 
          1        income and most diverse neighborhoods of the
 
          2        Twin Cities.  And they have consistently been a
 
          3        reliable partner.
 
          4             I, as well, believe that this mode of
 
          5        operations will continue.  It's clear to me that
 
          6        decision-making is decentralized in Norwest,
 
          7        that autonomy flows to the people that we need
 
          8        to work with sort of closest to the action, so
 
          9        to speak.  And I am confident that that -- that
 
         10        corporate culture will be maintained and our
 
         11        partnership will -- will flourish into the
 
         12        future.
 
         13             Thank you.
 
         14                  CHAIRPERSON SMITH:  Thank you.
 
         15             Mr. Cutts?
 
         16
 
         17                  MR. CUTTS:  My name is Jerry Cutts.
 
         18        I'm the Executive Director of the Development
 
         19        Corporation for Children.  We're a state-wide
 
         20        nonprofit organization.  We help lower income
 
         21        communities to plan, develop and finance
 
         22        children's facilities, like Headstarts and child
 
         23        care centers.
 
         24             We -- our key activities have been in the
 
         25        area of actual development and construction of
 
 
 
 
 

 
 
                                                              211
 
          1        facilities.  And a couple years ago we decided
 
          2        that we were interested in investigating the
 
          3        creation of a loan fund to help participate in
 
          4        these activities.  And so what I wanted to do is
 
          5        just very quickly tell you the brief story of
 
          6        Norwest's involvement because I think it's
 
          7        good.
 
          8             We started by working with some funds from
 
          9        a national foundation to coordinate statewide
 
         10        policy round tables to look at the demand for
 
         11        this kind of fund.  And Norwest immediately
 
         12        jumped in and played a very critical role in
 
         13        that process.  Muffy Gabler in particular was
 
         14        very, very involved with us, not only in
 
         15        participating in the round tables and playing a
 
         16        leadership role, but in giving us advice -- our
 
         17        advice that we settle on along the way about how
 
         18        we might effectively be able to pull in other
 
         19        banks, investors, as well.  And over the series
 
         20        of four or five round tables, we were able to
 
         21        come up with recommendations to the Legislature
 
         22        and to the private sector, as well, for
 
         23        potential for their involvement.  And we were
 
         24        successful in doing that.
 
         25             I wanted to point out a couple things.  One
 
 
 
 
 

 
 
                                                              212
 
          1        is that this fund, which is called First
 
          2        Children's Finance.  It's now up and running and
 
          3        make loans left and right.  Norwest has a loan
 
          4        officer on our loan committee and continues to
 
          5        provide us with technical assistance.  The
 
          6        foundation as well provides us with operating
 
          7        support.  And Norwest has made an equity
 
          8        investment into the pool -- revolving pool of
 
          9        financing.  So that's all been very, very
 
         10        valuable to us.  I'm -- have been very happy
 
         11        with not only the technical assistance, but
 
         12        their collaborative spirit.  And I think that's
 
         13        hard to do in a competitive environment where
 
         14        you -- we have a situation where we've got lots
 
         15        of high-profile investors and lenders.  And
 
         16        Norwest has done a great job of providing
 
         17        leadership and kind of keeping a quality among
 
         18        the players.  So that's the main story that I
 
         19        wanted to tell.  I'm very appreciative of all
 
         20        aspects of their support and anticipate that
 
         21        that will continue.
 
         22                  CHAIRPERSON SMITH:  Mr. Fulton?
 
         23
 
         24                  MR. FULTON:  Thank you.  It is really
 
         25        a privilege to be here today.  The Family
 
 
 
 
 

 
 
                                                              213
 
          1        Housing Fund, the organization of which I'm
 
          2        president, was formed back in 1980.  And its
 
          3        mission is to sort of rally the private
 
          4        philanthropic sector as a partner for -- with
 
          5        the federal government, the state government,
 
          6        local government in providing for the affordable
 
          7        housing needs of people in our community.  So
 
          8        the fund is really an intermediary
 
          9        organization.  And one of our responsibilities
 
         10        is to kind of keep track of everything that's
 
         11        going on in the community in terms of knowing
 
         12        exactly where the needs are.  We divide our
 
         13        programs up into three general areas,
 
         14        homeownership -- affordable homeownership for
 
         15        lower income working families.  Secondary is the
 
         16        production of affordable generic rental housing
 
         17        for people who don't have quite the incomes to
 
         18        get into homeownership.  And the third area is
 
         19        what we call special needs housing or more than
 
         20        shelter, which is the combination of housing and
 
         21        human services for very vulnerable people,
 
         22        people who are often homeless.  So basically a
 
         23        good community housing policy, good community
 
         24        housing programs, will involve a partnership
 
         25        between the public and private sector and will
 
 
 
 
 

 
 
                                                              214
 
          1        address the housing needs along that entire
 
          2        continuum; homeownership, rental housing,
 
          3        special needs housing.
 
          4             I have worked with Norwest closely for the
 
          5        entire 18 years, just about, that I've been
 
          6        president of the Family Housing Fund.  And I can
 
          7        report that they, Norwest, has been extremely
 
          8        active, played critical, decisive roles in each
 
          9        one of those three areas; homeownership, rental
 
         10        housing, special needs housing.  Norwest has
 
         11        what I would consider a state-of-the --
 
         12        state-of-the-art mortgage lending program that's
 
         13        targeted to lower income buyers, communities of
 
         14        color, first time home buyers.  They have a
 
         15        very -- a very, very successful commitment
 
         16        through the CHOP Program, which Steve has
 
         17        mentioned, in providing flexible financing
 
         18        that's helped, I would say, hundreds of families
 
         19        become homeowners.  We have a lot of special
 
         20        programs.  For example, programs to help public
 
         21        housing tenants become homeowners, to help
 
         22        people move from rental to ownership, to help
 
         23        people convert their Federal Section VIII
 
         24        certificates to homeownership.  Each one of
 
         25        those programs to be successful combines public
 
 
 
 
 

 
 
                                                              215
 
          1        subsidies with a private mortgage.  And I can
 
          2        say that Norwest has worked just extraordinarily
 
          3        well with each of those programs to provide
 
          4        those homeownership opportunities for those
 
          5        special populations.
 
          6             One of the things that my experience has
 
          7        been with Norwest is that some organizations and
 
          8        businesses do little, if anything, in the area
 
          9        of housing and community development.  Some do
 
         10        it in kind of a token or begrudging way and some
 
         11        do it with genuine commitment and enthusiasm.
 
         12        And that -- my uniform experience with Norwest
 
         13        as an institution and all the people that work
 
         14        there is that there is genuine commitment to
 
         15        affordable housing and community development in
 
         16        this community.  It's expressed through their
 
         17        willingness to provide financial resources that
 
         18        are needed both through the normal bank lending
 
         19        programs wherever possible and investment
 
         20        programs and tax credits.  The -- in addition to
 
         21        the homeownership programs in the area of rental
 
         22        housing and special needs housing, Norwest Bank
 
         23        has invested in -- as an equity partner in
 
         24        specific rental projects serving low-income
 
         25        people and projects that have combined housing
 
 
 
 
 

 
 
                                                              216
 
          1        with support services for people with special
 
          2        needs.  Unusual kinds of loans, but critical in
 
          3        terms of the successful financing of those
 
          4        projects.
 
          5             The other -- the other one thing that I'll
 
          6        mention is that -- the volunteers of Nor --
 
          7        Norwest.  We've talked about some of the
 
          8        individual employees.  Norwest executives have
 
          9        served on countless boards and organizations
 
         10        with which we've come into contact.  Pat Hanson
 
         11        from Norwest serves on the Board of the Family
 
         12        Housing Fund.  And everybody I've seen here from
 
         13        Norwest today is -- I have had personal
 
         14        experience with them in terms of their being
 
         15        active volunteers and decision-making bodies.
 
         16                  CHAIRPERSON SMITH:  Thank you.
 
         17             We'll go on to Mr. Watt.
 
         18
 
         19                  MR. WATT:  Good afternoon.  My name is
 
         20        Jim Watt.  I'm Executive Director of Twin Cities
 
         21        Neighborhood Housing Services.  And thank you
 
         22        very much for the opportunity to be here and
 
         23        express my views and those of Twin Cities
 
         24        Neighborhood Housing Services and our affiliated
 
         25        partners.
 
 
 
 
 

 
 
                                                              217
 
          1             A brief overview.  For more than 20 years
 
          2        Twin Cities NHS has been rebuilding the American
 
          3        dream one home at a time.  We help low and
 
          4        moderate-income families purchase a home by
 
          5        arranging financing for families who might not
 
          6        qualify or even know how to get conventional
 
          7        mortgages by providing home buyer education to
 
          8        more than 1,100 first time home buyers in 1997
 
          9        alone and by rehabilitating decaying
 
         10        neighborhoods, resulting in revitalized
 
         11        communities.  Yearly we also sponsor Neighbor
 
         12        Works Week, a community beautification program
 
         13        that brings more than 400 volunteers together in
 
         14        various inner city neighborhoods to make their
 
         15        communities better places to live.  We couldn't
 
         16        do any of it without partners like Norwest
 
         17        Bank.
 
         18             Our relationship with them goes back 20
 
         19        years.  Norwest and its predecessors have been
 
         20        there since the beginning working with us,
 
         21        assisting low and moderate-income families.
 
         22        Norwest plays a significant role in our lending
 
         23        efforts within the inner city.  We work together
 
         24        in true partnership to provide homeownership
 
         25        opportunities for families who might not
 
 
 
 
 

 
 
                                                              218
 
          1        otherwise qualify for conventional financing.
 
          2             Norwest also supports us in the form of
 
          3        operating and program grants.  They have already
 
          4        contributed more than $500,000 to Twin Cities
 
          5        NHS in operating grants alone.  They also
 
          6        support us with a variety of mortgage and rehab
 
          7        loan products designed specifically for our
 
          8        constituents.  These products are necessary for
 
          9        the success of our mission.  Knowing that grants
 
         10        and loans are decided upon on a regional and
 
         11        local basis is very important to us.  We have no
 
         12        concern that philanthropic decision-making will
 
         13        change with either their headquarters or their
 
         14        name.  Norwest corporate citizen philosophy and
 
         15        the trust we have in them based on our
 
         16        experience are enough for us to feel very
 
         17        comfortable with the merger.
 
         18             Norwest executives sit on our various
 
         19        boards and get involved.  Pat Hanson is
 
         20        treasurer of our Board of Directors.  Pat
 
         21        Donovan chairs our campaign.  The corporation
 
         22        itself supports employee volunteer efforts
 
         23        throughout the year and is another sign of being
 
         24        a great corporate partner and meeting the
 
         25        additional needs of area nonprofits.
 
 
 
 
 

 
 
                                                              219
 
          1             To reiterate and conclude, we truly believe
 
          2        this merger with Wells Fargo will be a good
 
          3        thing, bringing Norwest corporate citizen
 
          4        philosophy to the merged organization, will
 
          5        enhance the cultural differences with Wells that
 
          6        have been talked about.  Because of the
 
          7        leadership roles that it looks like Norwest will
 
          8        be taking with the merger, because of the
 
          9        outstanding CRA rating Norwest has maintained,
 
         10        because of the continuation of regional and
 
         11        local philanthropic decision-making and because
 
         12        of our history with Norwest Corporation, we
 
         13        strongly support their merger.
 
         14             Thank you.


	
Last update: December 3, 2010