Wells Fargo discusses TARP in Philly conference call

Wells Fargo & Co. chief executive officer John G. Stumpf had a pretty good reason why he couldn't fly from his San Francisco home to give a speech before Philadelphia's business community yesterday.

Actually, $7.5 billion worth of reasons.

The release of the results of the "stress tests" on 19 big banks by the Federal Reserve on Thursday at 5 p.m. meant that Stumpf's bank, which bought Wachovia Corp. in January, must raise $13.7 billion in capital.

In a conference call Thursday evening, Stumpf told analysts that Wells Fargo didn't think it needed any more capital. But as a recipient of $25 billion from the federal Troubled Asset Relief Program (TARP), the bank doesn't call the shots; regulators do.

So in a matter of hours, it raised $7.5 billion by selling common stock at $22 a share.

And yesterday morning, using a satellite uplink, Stumpf spoke to the businesspeople gathered for the Greater Philadelphia Chamber of Commerce's fourth annual State of the Region event at the Convention Center.

The TARP money "was not a gift. We pay big interest on that," Stumpf told the local crowd. "I will thank the U.S. taxpayer and government for helping us through these" tough times.

Wells Fargo's purchase of Wachovia, of Charlotte, N.C., was not about getting bigger, he said, although the deal did get the West Coast bank a beachhead in the East.

"Bigger is not better. Better is better," Stumpf said. But with the acquisition, his bank now has the largest share - nearly 21 percent - of the eight-county Philadelphia area's deposits.

Select Greater Philadelphia, an arm of the chamber, used the event to present highlights from a 40-page report that it will use to market the 11-county region to companies looking to relocate.

One that already has moved here is Air Liquide SA, which opened its U.S. Research and Technology Center in Newark, Del., in January 2007.

Air Liquide's vice president of research and development for North America, Shekar Shetty, noted how glad he was to be in the Philadelphia area.

"I'm a big Cubs fan," said Shetty, who left Chicago to set up the Delaware center, which now employs more than 100. "But 100 years of losing was enough. We move here and the Phillies win" the World Series.