The planned merger of Wells Fargo & Co. and Norwest Corp. is likely to prompt fewer employee departures than usual, and credit belongs to the Minneapolis company for keeping people on board, observers said.
At a recent meeting with bank analysts, Wells Fargo president Rodney L. Jacobs said there have been few departures from the two banking companies since their deal was announced in June.
Mr. Jacobs, who is slated to be vice chairman and chief financial officer of the combined company, said the overwhelming majority of Wells' senior vice presidents and department managers have decided to stay on even if their new jobs give them less responsibility.
"Wells has had pretty much 100% buy-in," said an analyst who was at the meeting. "There have been very few defections."
Some observers said the loyalty is due to the policies of Richard M. Kovacevich, Norwest chairman and chief executive officer, who is to retain those titles at the new company.
Mr. Kovacevich believes in creating a company that places a high value on employees, these analysts said. This notion is borne out by an Oct. 7 memo sent to employees of both companies. The merging banks have formed four groups of human resources officials to "help keep as many team members as possible with the combined company," according to the memo.
"Retaining team members is one of the most critical parts of our merger," said Patricia R. Callahan, the Wells executive vice president named to head human resources at the post-merger institution.
"Norwest is known to be focused on its employees," said Campbell K. Chaney, an analyst at Sandler O'Neill and Partners of Walnut Creek, Calif., but "Wells for quite some time has been saying that stock price is everything. This merger has got to be a morale boost for a lot of Wells people."
"A lot of the tension that employees felt before the merger is gone now," confirmed a Wells Fargo manager, who asked not to be identified.
The willingness to ride out the merger, which is expected to close in early November, appears to extend to Wells' top ranks. Among the San Francisco company's nine highest-ranking officers, all but two have said they would stay on.
Vice chairman Charles M. Johnson, who heads wholesale banking, is to retire at yearend as he had planned before the deal was announced.
And Joseph P. Stiglich, vice chairman in charge of Wells' branch banking group, also plans to leave after the merger.
By comparison, four of seven executives in the old BankAmerica's office of the chairman have decided to leave that company, which closed its merger with NationsBank Corp. Sept. 30.
However, some observers noted that BankAmerica officials were offered a generous severance package to leave. These so-called golden handshakes have not been offered at Wells, the observers said.
In addition, executive posts at large western banks are in short supply, one consultant pointed out. "There is no incentive for these people to leave and no place to go" if they want to remain on the West Coast, he said.
"Wells people are pretty sharp," he added. These people know "you can't be completely employee-friendly and cost-effective at the same time."
