Fair warning to any U.S. Bank employees looking to capitalize on competitor Wells Fargo’s recently tarnished reputation: Don’t.
Or at least don’t use an orange flier.
“So help me God, if I find a branch in one market with an orange flier that says if you bank at Wells come to U.S. Bank, they’re going to be let go,” said U.S. Bank CEO Richard Davis, at an investor’s event in New York on Thursday. “That’s not the way we do business. It will come to us if we’ve earned it.”
Wells Fargo is trying to clean up a yearslong scandal that broke a week ago after employees opened millions of accounts for customers without their knowledge. Wells Fargo is the largest bank by deposits in Minnesota, has its roots in the Twin Cities and largely overlaps with U.S. Bank’s geographical footprint.
Asked by an analyst whether the scandal is a “disruptive opportunity,” Davis didn’t rule it out, but said he’d come down hard on anyone in his company who tried to explicitly make the case.
“We went out on Monday morning and asked everyone in the company to take no advantage of the Wells circumstance. None. Because the fact of the matter is, the circumstance itself, whatever it becomes, is going to be ours to benefit if the customers decide to move toward us,” he said. “It may be an opportunity for us but it’s not our job to go out there and call that out. It’d be inappropriate.”
Davis did, however, say that U.S. Bank is always trying to take customers away from competitors, and allowed that Wells Fargo’s scandal could help U.S. Bank in the long run.
“We’ve worked hard to earn everybody else’s business as the next potential customer and client,” he said.
Davis also said the bank is not currently looking to expand into more states.
With branches in 25 states across the western United States and Midwest, the bank does not have branches in the Deep South or on the East Coast.
U.S. Bank has pushed into national commercial lending over the past few years, but that doesn’t mean the company wants to expand its branch footprint into new states.
“I don’t want to be in Raleigh, or Atlanta, or Miami, or places I’m not, in some small fashion,” Davis said. “It’s just not worth it because you’re just a small idea in somebody else’s big market. You don’t have any marketing power and you don’t have any visibility.
Asked whether the bank would consider acquiring smaller banks, Davis said he’s on the lookout for acquisitions in states where there are already U.S. Bank branches.
“The markets I like least for us is where we’re not top three and there’s more opportunity for us to double down there in those 25 states than to add one more state,” he said.
He pointed to the 2014 acquisition of 150 branches in Chicago from Citizens Financial, and the 2011 acquisition of First Community Bank in New Mexico as the types of deals he’d be willing to consider.
“I’d love to do more traditional bank M&A in our 25 states,” he said. “I could be inclined to look at adjacent states, but you’d have to go into the top three market share to get my attention.”