Four years after buying Acordia Inc., the big Chicago insurance brokerage, Wells Fargo & Co. has moved again to integrate it with its existing insurance operations.
Analysts said the San Francisco banking company's first try, shortly after buying Acordia in May 2001, never quite took hold. At that time, Wells moved Acordia's base of operations to Minneapolis and placed it within the existing insurance structure under Timothy J. King, then the head of Wells Fargo Insurance.
After six months - and with its executives dragging their feet about moving from Chicago - Acordia regained its more independent status as a separate subsidiary of the banking company.
Michael A. White, the president of Michael A. White & Associates, a consulting firm in Radnor, Pa., said now is the right time for Wells to try again.
"When Wells first tried to assimilate with Acordia, failure was unavoidable because they were still so new to each other," he said. "To change things suddenly just wasn't the right move. But now they have worked together for awhile and gotten acclimated to each other. I think they have a good chance to make this work."
In asserting control over its big Acordia insurance brokerage by naming a banker to head it, Wells Fargo & Co. picked an executive who had helped lead its mortgage division to the No. 1 spot in retail mortgage originations.
Peter J. Wissinger, who was named president Wednesday of Acordia Inc., the biggest bank-owned agency and the nation's No. 5 brokerage overall, voiced an ambition for the insurance businesses he will now lead similar to what he had accomplished in the mortgage business.
His plan for Acordia is the same it was for the mortgage business, Mr. Wissinger said - organic growth, cross-selling, and some strategic acquisitions. "I love growing businesses," he said. "There are a lot of similarities between the way these two industries work and grow." "There is no reason we can't grow given how big we are now," he added.
Mr. White said it is good for an executive to start with such lofty aspiration. "Wells has the size and volume to accomplish this," he said. "With so many other public brokerage houses taking hits in the wake of Mr. Spitzer's investigations, there will be opportunities."
Wells will have to make some acquisitions to reach the top of the insurance business, Mr. White said. "Wells can't just do this organically," he said. "It is not just a matter of making the parts move smoother and faster. It will take some acquisitions as well."
Using a term from the mortgage business, Mr. Wissinger said, "I'd like to be the biggest originator of insurance for businesses and consumers in the country. I don't know how long it will take to get me there but that is where we are going."
This is more than wishful thinking, he said. "When we said that in mortgage 20 years ago, no one believed us," he said, "but here we are today, the largest retail mortgage lender and second-largest lender overall."
"Acordia is already fifth in business, there is no reason we should be bashful about aspiring to be number one in that business," he said. "From a consumer standpoint, we are starting from a lower point, but that doesn't mean we have a bias one way or another. We will grow both."
For the past 18 months, Mr. Wissinger has been the president of Wells Fargo Insurance, the parent's retail insurance business, and he oversaw Minnesota-based Rural Community Insurance Services, the nation's largest crop insurance managing general agency. His office was already in Chicago, and his appointment unites the leadership for all of Wells' insurance businesses under an executive who is a member both of Acordia's board and of the parent's management committee.
He will remain chairman of the Wells Fargo Insurance Governance Group. Mr. Wissinger succeeds Kevin W. Conboy at Acordia. Mr. Conboy, who is in his mid-50s and was named Acordia's president and CEO less than three years ago after 17 years with the brokerage, will retire from the company, Wells said. Mr. Conboy embarked on an agency acquisition campaign in 2003-04 to spur growth and match the parent company's market reach; he also emphasized an intent to play to Wells' strength in cross-selling.
Mr. Wissinger joined Norwest Mortgage in 1984 as a vice president and store manager and was promoted, successively, to regional manager, division manager, and national retail production manager. In 1997, he was given responsibility for the mortgage-servicing portfolio. With the Norwest-Wells Fargo merger in 1998, he was named group managing director for retail, servicing, and institutional lending sales and operations.
He was named president and chief operating officer two years later and in January 2001 became head of Wells Fargo Home Mortgage. He moved to the insurance business in June 2004 "with the goal of dramatically growing" it, Mr. Wissinger said. Since then, he said, he has focused on getting a better understanding of the insurance industry and the competition and setting an expansion strategy.
"This work is progressing nicely," Mr. Wissinger said. "This move just brings the business insurance side into it. There are a lot of synergies, and this is an opportunity to accelerate our growth strategy."
Mr. Wissinger will report to Dave Zuercher, the head of international and insurance services at Wells and Acordia's chairman.
"My view, without studying the specifics of this business," Mr. Wissinger said, "is the same as my view of mortgages was. We will use both organic means and acquisitions equally. We will use whatever means allow us to grow the fastest and with the best economic opportunities."
