Please welcome Carol Smith, who is based in Austin and has considerable experience in financial services industry research and analysis. I’m pretty confident she’s also listened to more analyst conference calls than most Naked Capitalism readers have, and you’ll see her put her experience to good use.
By Carol Smith
A Financial Times article today showcased recent comments by bank executives and politicians (and even Erick Erickson of RedState.com!) sympathizing with the sentiments behind the Occupy Wall Street movement. John Stumpf, CEO of Wells Fargo is quoted from the earnings call today, “I understand some of the angst and the anger. This downturn has been too long, unemployment is too high, and people are hurting. We get that.”
This comment came during the Q&A portion – more on that later – and doesn’t convey the extent to which the management of Wells Fargo seems deeply concerned and perhaps fearful about how the Occupy movement is turning public sentiment even further against Wall Street and the TBTF banks. Stumpf spent nearly the entirety of his opening statement making the case for Wells Fargo as a force for good the US economy. Some high(low?)lights:
“Wells Fargo has not wavered from our commitment to do all we can to help our customers and the overall economy.”
“Since 2009 we have hosted 40 home preservation workshops.”
“We are also lending, providing companies funds for growth and job creation.”
“Wells Fargo employs 1 in every 500 Americans and last year we contributed $219M to 19,000 non-profits across the US…”
But never fear! Nancy Bush of NAB Research LLC and SNL Financial rode to the rescue in the Q&A portion to assure the Wells Fargo management she had their back. She asked them a series of questions that were basically thinly veiled opportunities for her to praise management as “astute securities portfolio managers”, commiserate about what a pain in the neck it must be to have to deal with the CFPB, and encourage them to wage a PR campaign with the other banksters to convey that “the banking industry is not some evil behemoth out to crush the middle class.” With these kinds of probing questions one wonders how the TBTF banks developed the attitude that they can do no wrong.
Earnings calls have a certain tone that makes them generally pretty boring. No matter what happened in the quarter, there is usually an “everything’s fine and dandy” vibe coming from management and the questions are generally not particularly probing or pointed. The underlying defensiveness of management that came through from the long and almost melodramatic opening statement of John Stumpf and the protectiveness of Nancy Bush in her questioning says only one thing to me. Occupy Wall Street is getting to them.