All right, everybody, welcome again back into the room. So, we have up next, in a big day for banks, the Senior Executive Vice President and CFO of Wells Fargo, Mike Santomassimo. Mike, welcome.
Great. Thanks for having me.
Absolutely. So maybe we'll just kick off at the top of the house. Again, we find ourselves in a crosscurrent of geopolitical uncertainty, tariff policy, but at the same time, it feels like corporates are feeling good to start the year. You have deregulation across sectors, potential for lower rates. So maybe let's start with how your consumer, corporate, institutional, and wealth clients are considering these factors as they think about activity levels in 2026.
Yeah. No, look, I think, as you look at the start of the year, and it's really been a continuation of what we've seen now for a number of quarters. Activity levels are really good. Spend on the consumer side is up year on year, every week, consistent in terms of, you know, the percentage increase that we're seeing. Categories move around all the time, but overall, like, that spend across debit, credit, you know, very, very consistent, which I think supports, you know, this really strong growth that we're seeing overall in the economy. Credit performance is still very good. We're not seeing signs of any systemic deterioration at all across, you know, the consumer or the commercial portfolios.
And so overall, you know, delinquencies are great, you know, performance is great, spend's really good, so it sets us up for a pretty good year, it looks like, on the consumer side. On the commercial side, it's pretty similar. Now what you're not seeing still in the commercial banking client base is this, you know, big investment cycle yet. You know, people aren't utilizing the revolvers more significantly than they had. It's still the utilization rates are still low on a historical basis. So I think that's an opportunity as people continue to get more and more comfortable with, you know, where the economy's going over the next couple years.
But there again, we're seeing, you know, good, good credit performance, good activity levels overall, no systemic issues popping in the portfolio, you know, across any of the areas. And so I think it sets us up for a pretty, pretty good year. And then you couple that with really strong markets, and, you know, a little bit of volatility here and there on the equity market side, but very strong markets overall. And I think so that, y ou know, everyone's feeling like it should be— you know, the activity level should continue into this year, and that includes investment banking side, it includes, you know, all of what we're seeing across really most of the client base.
Refocusing back to Wells Fargo specifically, other than, of course, growing your balance sheet, how has your strategy shifted, if at all, since the lifting of the asset cap? Of course, we've seen the growth in trading assets, but maybe talk about specific businesses or desks where your mindset on balance sheet allocation may have really shifted post-asset cap lifting.
Well, the strategy hasn't changed at all. And a lot of where we're seeing growth are the areas that we started investing in, you know, four, five, six years ago. On the consumer side, it's places like card, it's in our retail footprint across the core consumer banking space. On the commercial side, it's in places like investment banking, the markets business. So now that we've got the flexibility to grow the balance sheet, you're starting to see some of that actual growth come through, but it's really no different than what we laid out over the last number of years, and we've been talking about the last couple of years. On the market side, which the place...
You know, with the business, you know, by far the most impacted by the Asset Cap, what you've seen so far, in large part, is growth in a lot of the financing trade, you know, financing business that we have across there, across, you know, mostly fixed income, but other asset classes, as well, in that business. And really, that's the place that you should expect to see, you know, grow first. It's all high-quality collateral, it's very low risk, low RWA, you know, good returning business, and it ends up being the thing that helps you then build the other activity with that client base.
That'll come, you know, over a period of time, but, but I think we're very, we're very pleased with what we're seeing come through so far across those, those businesses. It's been pretty widespread across the client base. It's been, you know, pretty, pretty much, you know, focused on a number of places across the markets business. And it's exactly what we expected to happen as we came out of the Asset Cap and started to see some growth.
So, speaking of growth, your outlook for mid-single-digit average loan growth in a 4Q 2026 versus 4Q 2025 timeframe would imply end-of-period loan growth of 3.5% in 2025. The H.8 data has recently implied that the large bank group is one standard deviation above seasonal, so seasonal trends, so things are a little bit better. You know, given the dynamic that you specifically have in card and auto and what you just laid out on commercial, what continues to be the drag on total loan growth for Wells? And should we consider some conservatism maybe baked into that number?
Well, I think... Let me tell you what we're seeing across the portfolios, and then,
Yes.
Y ou know, we're hopeful that we'll do better than what we laid out. Well, I'll walk you through each of the portfolios. You know, on the card side, as we said, we're seeing good growth there, and it's been pretty consistent now for a while. It's really driven by the newer products that we've launched over the last three or four years. And I think, you know, that continues. And we saw a good uptick in new account origination in the credit card business in the second half of last year, you know. And so hopefully, that will continue into this year and continue to support sort of, you know, good growth there.
And we're very pleased with what's going on there, and I think you'll see some more new products come, you know, this year focused on some of our wealth management client base and, and some other pockets that we've got there. You know, in the auto business, if you go back now, take a couple steps back a few years ago, you know, we very much focused on, you know, prime, super prime, you know, part of the business. While we sort of reinvested or invested in our underwriting capabilities to make sure that we were very comfortable with the way we were going about becoming a little bit more of a full spectrum lender. I say that like a little more full spectrum. I wouldn't say we're going all the way down into deep subprime in any way.
So it's really just coming down a little bit in the credit spectrum there. You couple that with bringing on the Volkswagen Audi preferred partnership that we have with them in the U.S., and you're seeing really good growth in the auto business now, you know, over the last, you know, two to three quarters. And we're really liking the momentum that we have there, so we should expect to see some growth, you know, continue overall in that business. The one place that's not growing much in the consumer side is the mortgage business.
Yeah.
So we've seen some decline in that over time. That decline should moderate and be relatively flat, you know, throughout the year. And so that's really what's happening there. And I think depending on, you know, sort of how things shape up on the consumer side, you could see a little more, a little less, depending on, you know, in each of those categories, depending on how things play out for the year. On the commercial side, you've seen, you know, really good growth in the corporate investment bank, and you've seen some growth mainly from new clients in the commercial bank. Like I said before, we're not seeing a lot of utilization from, you know, the commercial increases in utilization from the commercial banking client base yet.
And so if that starts to pick up, that would be a positive relative to overall, the expectations that we set. But we're seeing like good, healthy growth there, in that business. And, you know, over the last, you know, two or three years, we've been adding hundreds of, you know, commercial bankers in local markets around the country, and some focus on some industries like healthcare or technology and other places. And we're starting to see really that investment pay off with an increase in new account, new client growth over, you know, last year and then coming into this year. So that's what's driving there. And so we'll see if things are.
If that investment cycle really starts to pick up in that client base, we should see, you know, higher growth there, but we'll see. And then on the corporate investment banking side, what you're seeing there is some growth in the non-bank financial space, but also some growth across like a broader set of clients. In the non-bank financial space, it's areas that we've been in for a long time and are very good at. You know, our capital call facilities and fund finance, you know, that we deal with large private equity, private credit managers, and then a whole bunch of other asset classes there that you've seen grow over the last couple of years.
But you're seeing some good growth across a lot of the other asset classes, which is a good sign that, you know, some of those other sectors, clients in those other sectors are really starting to make some investments and borrow, which I think should hopefully be a good sign as we go later in the year. So are we being conservative? Who knows? But I think overall, like the signs, the momentum's good. We're comfortable with like the risk appetite we've got. And depending on how the year plays out, it could be a little better.
Maybe just to follow up on the investment cycle for your commercial bank clients, the speaker before you was very bullish on the stimulative effects of the Big Beautiful Bill, and how it could stimulate the CapEx cycle. Do you feel, from what you're hearing from your commercial bank clients, is that really going to be a factor in terms of the CapEx cycle?
Yeah, I think it matters.
Yeah.
For sure, and I think it's a net-net positive. But I think, you know, you know, remember, people had to deal with a lot in the second half of last year.
Yeah.
You know, you had some tariff.
Tariff.
N oise, you had some supply chain stuff you had to work on, you had... You know, people were still a little uncertain where the overall economy was going, and was there gonna be a little bit of a slowdown or not? And so I think as those things, you know, are a little bit more in the rearview mirror, and people can then refocus their energies on those growth initiatives. And I'm sure others are saying this too, you're gonna see, you know, more activity like M&A and other across a bunch of different sectors. And that's all part of that investment cycle, I think, as you look across that client base.
So, assuming like, you know, the economy overall continues to have some good momentum, I think you'll see more of that happen, and I think the bills, you know, certainly is part of that.
Does the OCC extinguishing the leveraged loan limits that they put in place in 2013, does that have any meaningful impact or notable impact for how you're thinking about what you put on the sheet?
Look, it definitely matters. Is it gonna be... You know, is it gonna change the, like, the growth rate of loans by, like, significant amounts? Like, probably not, like, in the short run. But it does matter a lot, and I think it helps, it helps us be much more competitive in, in a, in a bunch of situations that, you know, we're very comfortable with the risk. We've known clients for a very long time, and it allows us to compete and really keep that client or, or grow with that, you know, those clients, in a very, in a very different way.
And so I think it does, it certainly does matter, and I think just broadly, you know, being able to, you know, have more flexibility, more freedom to kind of set your risk appetite, really work with clients you've known for a very long time. And a lot of those clients, keep in mind, are like commercial banking style clients, and, you know, in a lot of cases, we've known these clients for decades and decades. You know, every client, every commercial banking event I go to, there's a client that says, "You know, 20 years ago, or 30 years ago, or 10 years ago, you were there, you know, as a bank to really help support us." And so these are clients that we've known forever.
And I think, you know, it does help us be much more competitive there, and gives you another quiver in your toolkit.
So I think the progress that you've made in the results in your corporate and investment bank or your CIB has been sort of the most telling piece of evidence that you guys were growing underneath the Asset Cap, right? That your strategy hasn't really changed. You know, 2026, again, we had a very bullish figure on capital markets for 2026. You know, maybe let's just start with banking. You know, given your starting point, should we assume that you can continue to grow higher than what the wallet growth is going to be in 2026? And in terms of advisory versus ECM versus DCM, where are your strengths currently biased?
Yeah, I mean, that's certainly the goal, is to keep growing market share. And I think we've been able to do that now for a couple of years and really start to, you know, grind that up over time. And if you take a little bit of a step back in investment banking, you know, what we've been doing now is executing a strategy we set out three or four years ago, which, you know, is just very simple in terms of making sure you got the right people covering the right clients, you got the right types of folks in on all of the product areas, including, you know, M&A, advisory, you know, equity and debt capital markets, and, you know, with sector expertise, you know, across them.
What we've done is we've hired, you know, roughly 100 or so, you know, senior folks across the investment bank. We're starting to see, you know, that those new folks, you know, together with the base of folks that have been around a long time, really start to do... You just see the results come through in terms of more, more deals that, you know, we wouldn't have been on in the past. You know, it's both across the corporate investment bank, but also the commercial banking, you know, client base as well, where there's lots of activity that, you know, we just weren't taking advantage of, in the past.
And so the goal is to, you know, continue to see more progress, and I think the most visible way you see that progress is through market share.
Mm-hmm.
A nd wallet share increases. And when you look across, you know, each of the, you know, each of the product areas, like, we feel like we can compete with anybody. You know, we, we're continuing to add people in different, you know, subsectors across the, you know, the main industry groups. And we've been super pleased with, you know, all of the folks we've been able to recruit from really all over the place. And, and I think they really, you know, the, the platform and the growth story and being able to build, build the business from, you know, what already is, has, you know, business that has some scale to it, is very, you know, very much resonates with all the people we've, we've brought in.
And so we've been really, really, really happy with that progress, and I think, you know, the goal is to continue to, you know, build that up and become, you know, first top five, and then we'll see where it goes from there in terms of, you know, overall share.
Speaking of the markets business, I'm sure the same concept will be applicable. One of your GSIB peers noted that the trading, or markets rather, should grow 2 x GDP. Do you agree with that? And again, can you contextualize sort of where the market share wins could be, maybe by product?
Yeah, look, you know, it's hard to, it's hard to like, you know, come up with an exact number, but, like, for us, you know, the opportunity is big in, in markets.
Yeah.
As I said earlier, you know, that was a business most constrained by the Asset Cap.
Absolutely.
We just couldn't do basic things to help support clients across, you know, basic financing needs, which leads to other activity, you know, with folks. And I think we feel really good about the opportunity there. And I think when you go talk to clients, they want—they, they, they... It's a competitive marketplace, but they want more providers, you know, and more, and more firms that can, then, that can support them. And we're seeing, you know, really good uptake from all the brand names across, you know, the, you know, the wallet, you know, in the, in the street that are there. And I think we've seen some really good evidence that, you know, that, that demand is there.
You know, I've talked about our FX business in the past, but you look at our FX business, you know, we built it from a, you know, basically only doing corp FX for corporate payment flows. You know, we systematically sort of built out, like, an institutional, you know, side of it, and we hit record volumes every quarter now, you know, in that business. And you can sort of take that same, you know, playbook that we've had there and apply it to rates, apply it to, you know, some of what we're doing on fixed income financing. You've got, you know, the equities business. And again, we're focused mainly on U.S.-based clients, you know, and then supporting them, you know, where we need to outside the U.S.
It's a bit of a different, you know, comparison point to maybe, maybe some of the others. But we're seeing really good places. And even in, you know, one of our smaller businesses, like our commodities business, it's really built off the back of our corporate franchise.
Right.
And so, you know, we're relatively—we have really good, really good share in some odd, odd things within commodities, but it's really based on, like, the commercial banking and corporate, you know, banking business that we do across the country. And so it naturally, it's just a natural extension of what we do for a lot of those, a lot of those clients. And so we feel really good about the progress. You'll see, as I said earlier, what you've seen so far is a lot of financing activity that's grown the balance sheet so far, and then you fill in, and you monetize that financing activity by doing a whole bunch of other things with clients.
That takes a little bit more time, you know, to kind of come through the P&L, but we're very confident that the team's executing really well on that.
S o before we move on from markets, I do want to clarify something that you were trying to point out on the earnings call. You said you expected to grow total markets revenue in 2026. Maybe could you walk us through expectations for both the NII component and the fee income component?
Yeah, the markets revenue is like a favorite topic for a lot of people, and we like to break it apart between net interest income and fees. And when you're in an environment where either rates are going up or rates are going down, you have geography changes.
Yeah.
Between fees and NII. And so, and so sometimes that can, can distort things a little bit in terms of if you're, if you're looking at accounting line items. But when you look at the overall business, we expect markets revenue to grow year-over-year. That will mean higher NII, lower, lower fees, all else equal. But, oh, you know, if... Let me back up. If revenue was flat year-over-year.
Yeah.
You would see a geography change of higher NII, lower fees. But we're saying overall revenue should grow. How much? We'll see, right? A lot of that's going to be based on, you know, the volatility that's there and the activity levels in the overall market. But we're very optimistic about what we're seeing there, and I think we should see the overall revenue continue to grow there.
Okay. And so just to follow up, if markets revenue is growing, then the fee component could be flattish, potentially?
Potentially.
Okay. Just switching to the consumer side, on deposits, Charlie has been publicly saying that you should grow faster than market over time here as well. I think there's a big theme to this fireside chat. You have recently talked about new net checking account growth stronger in 2025 versus 2024. Could you contextualize this a little bit more?
Sure. You know, as part of what we had to do to fix the regulatory issues and, you know, in particular, the sales practice issues that.
Yeah.
Were there as a company, we needed to kind of tear down all of the incentive systems and all of the mechanisms you use to grow in the, in the consumer bank and rebuild them all. And so what, what you saw for a number of years was just not a lot of growth, you know, in, in the consumer business. And you can see that from a lot of the public metrics that are out there across, you know, different areas. And, and at the same time, because of the Asset Cap, we weren't out there proactively doing a lot of digital marketing or other, you know, really trying to grow, you know, aggressively in the consumer business for, for, for a number of years. So starting, I don't know, 18 months, two years ago, we started to reintroduce all that stuff.
Now, you know, new incentive systems with all the right controls around them, more rebuilt sort of the marketing capabilities, using a lot newer technology, better, you know, different people, and a whole bunch of things as we sort of invested in that. And so what you're starting to see is the benefit of that come through in better checking account growth. And, you know, this year or 2025 was up a bunch relative to where it was the year before. That was up a bunch from the year before that. A lot of it was driven, you know, by what we were doing in the digital space, and the branch system is starting to kind of, you know, come up to speed in terms of the productivity that we expect to see there.
And so we expect that to continue to grow. And I think as the branch system, you know, continues to, you know, become, you know, get to the level of productivity that we expect, you'll start to see that be a more meaningful contributor to it. And then we'll ultimately see sort of how we look relative, you know, to the other big banks. But we're seeing really, you know, good progress there over the last two years, and I expect that to continue into this year.
So sticking to the consumer, maybe let's talk a little bit about card. Again, you've shown some really great successes on the growth front, and of course, many investors know about the economics of card, particularly when you're building it from the ground up, right? The profitability is back-end loaded, so to speak. When do you think pre-provision profit in card can start improving more meaningfully as you sort of lap, you know, the marketing, the promos?
Yeah. So we've replatformed every product that we had, and the early ones got launched in the second half of 2021, really, and then more meaningfully in 2022. So you start to see, you know, the maturation of those vintages, you know, in about three years. So you'll start to see the early vintages mature now into this year. And so you'll start to see that impact grow starting now and into the coming years. And I think when you look at what we've seen so far across those vintages, it's doing exactly like what we thought it would. You know, the credit box is very strong, and in most cases, you know, the...
In really all the vintages that we've put on, the credit profile looks as good or better than the kind of the backbook that's been there a long time. So the credit performance has been really good. Delinquencies on the margin are a little bit better than we model still. You know, month after month, credit performance has been really good. Spend levels are up. And so overall, we're seeing, you know, kind of exactly what we'd see- we thought we'd see by, you know, through those vintages, and they start to more meaningfully, you know, compound over the next couple of years. But you'll see some of that increase starting this year.
So in terms of, you know, where you play, you know, in the spectrum, you know, obviously there's a lot of competition for, like, the high spenders and affluent.
Yeah.
Are you competing there, and are you continuing to market to your deposit base, or given the Asset Cap lift, are you starting to expand out?
Yeah, you know.
I did see your Super Bowl commercial.
Yeah. The... Yeah, it was you- only in certain markets, by the way. We're still, you know- We didn't, we didn't do a whole national commercial to, you know.
It was in Miami.
I'm too cheap, I guess. You know, I think the, you know, there's a couple, a bunch of stuff in there, so let me make sure I can capture it all. But, you know, when you look at the originations, it's still about 60/40, roughly directionally, you know, in terms of existing clients, new clients. So we are adding a lot of new clients to the mix, you know, each year, as we go. And so that's been a relatively consistent sort of, you know, percentage, for a while. We're not trying to go, like, to the uber high end. I think there's a ton of opportunity for us to participate more from where we are.
And then, as I mentioned earlier, launch some new products geared towards our wealth management clients, you know, both in the branch system, what we call Wells Fargo Premier.
Yeah.
Sort of that, you know, affluent customer, and then the, you know, the higher end wealth management or private banking type customer. So you'll see more products come out there this year. But we're not necessarily trying to go all the way up. When you think about the opportunity we have, we still have a lot of opportunity on the existing client base. There's still, you know, over 10 million customers within our footprint, within our consumer bank, that, you know, fit exactly in the credit box. And it's just a matter of continuing to market and make sure we've got the right product for each of those folks.
We've improved a lot of how the experience looks in the branches, too, so you're pre-approved in a lot of cases when you walk into a branch now. That wasn't always the case. And so there's a lot of tactics that we've put in place to increase that penetration, and we're seeing some good results there. And then as we have more products, you know, that fit the bill, I think that opportunity set gets bigger and bigger. And so there's a lot of opportunity still there, but we're seeing really good take up in the digital space, too. And what you saw in the second half of last year at our credit card originations is really two things. One, better performance in the branches.
So we saw a big uptick in new sales coming out of the branches for using a lot of the things I mentioned in terms of the tactics that we've put in place for the branch employees. And then we saw a lot of people coming directly to wellsfargo.com or our digital properties, which is a great way to do it because you don't have to pay that third party, you know, as you're marketing. And so we saw really good uptake in kind of the two most cost-effective channels, which tells you you're getting some good traction, I think, overall, with the value prop on the cards.
So let's talk about WIM, since you did mention that. So during the quarter, you said a couple of things: total hires increasing, attrition declining, and net asset flows accelerating.
Mm-hmm.
In the second half of 2025. What are the key growth priorities here for Wells in 2026, particularly as the momentum has shifted underneath the surface?
Yeah, I mean, you, you really got to look at it by channel. So there's... You know, we've got a, a few key channels that in the business. You know, first is what we call Wells Fargo Premier, I mentioned earlier.
Yeah.
This is focused on, you know, the folks in our that get serviced out of the branch system. So we've got a couple thousand, 2,500 or so advisors sitting in the branches already. And they're working with clients that have, you know, roughly $250,000 and above, either with us or away from us. There's something like, you know, eight million, six to eight million customers that probably have something like, you know, $6-$8 trillion, you know, billion, trillion dollars or away from us. And so there's, so there's a huge opportunity to better, you know, serve, you know, those customers. And if we can do a good job on the wealth management side of that equation, they will bring the data would suggest they'll bring 2x the banking and lending wallet as well.
And you're seeing the momentum really pick up in the second half of the year in terms of new flows coming onto the platform from that channel. And so we're really excited about that, that piece of it, and there's only a couple of us that really have that opportunity across, you know, such a scaled platform. You know, in the, you know, the private client, you know, channel, which is kind of the traditional sort of advisor channel, attrition's at as low as it's been. We're recruiting great teams from all over the place, which has been really good to see. And they're, they're not, you know, in the, they're not little small mom-and-pop teams in a lot of cases.
They're really big-scaled teams that are growing and really want, you know, our platform, our balance sheet to do interesting things on the lending side with their clients as well. And so we're seeing good momentum there across the board. And there, we're continuing to focus on, you know, more alternatives, banking, lending penetration, and really helping make the advisors more and more productive so they can grow, you know, on the platform. And then the other part, which the last channel, which is unique to us, is really servicing the independents.
Yeah.
Fastest-growing channel by number of advisors, by far, across the industry. It leverages everything we do across those other two channels. There's very little incremental investment needed to support those advisors. And you know, what was great to see in the second half of the year is we're starting to recruit people directly off some of the other platforms, whether it's an independent, you know, firm or sort of the traditional wire house type, you know, style platforms. And that's, you know, it's still a little early days to kind of see that really build, but we're starting to actually see people come direct into that, which is encouraging.
And so I think really across the board, you know, good things are happening in each of the channels, and I think, you know, we should be able to continue to see, you know, flows, you know, pick up as we go.
So I think it's very telling of the, quote, "new Wells story" that we only have less than 10 minutes left, and we're just getting to expenses. So you talked on the earnings call about further headcount reductions in 2026. Where are you guys in terms of your headcount efficiency journey? Clearly, there's been a lot of hope from investors that you'll take those regulatory remediation expenses, and then you could use that for growth-driving expenses, though you did mention on the call that the remediation expenses will be slower to trickle out. So maybe just unpack all of that for us.
Sure. Yeah, look, we've done a lot in the last, you know, five plus years. You know, I think we've saved roughly $15 billion of saves. We've reinvested most of that back into the products, platforms, people serving clients. We have, we've taken headcount down, I think it's 21 or 22, you know, quarters in a row, down, you know, significantly from, you know, 70,000 from, you know, where we started in the, you know, the peak in 2020. And when you look at the company, we still have a lot more to do. And that's before you even get to the benefits of things like AI.
Mm-hmm.
It just takes time to do it in a thoughtful, rational way. But across almost every part of the company, there's still more to do to make things as efficient as they should be, and we're focused on it. And outside of the personnel costs, there's also, you know, still more real estate to go. I always tell people we've got a couple buildings for sale in different cities, so if you're interested, call. But, like, you know, it takes time, you know, to really work down, you know, real estate footprint. It takes time, you know, to work down some of the third-party spend.
And there's just more, more to do there, and I think there should be less people, you know, for the size of and volumes, you know, that we have today going through the company. You then add AI on top of that, and I think that allows you to do much more, much different, you know, set of activities. A lot of what we're doing this year doesn't really rely on AI. I think you'll see more benefits from AI coming in the coming years, you know, maybe, maybe as you start to exit this year, in the next year, and then, and, and beyond. But I think that unlocks a whole bunch of different opportunities that may not have existed sort of, in, in, in the past.
So we think we've got a lot more to do and are continuing to focus on it. On the regulatory spend, you know, we've added a lot of people and a lot of spend to manage the, you know, risk and control infrastructure that we built out. And I think as you look at what we did, we started the journey, you know, six years ago. So now, if you take a step back and look at what we've done, there's gonna be... Of course, there's gonna be ways to make it, like, more streamlined, more efficient, more automated. You know, maybe there was a little duplication of things in certain pockets to sort of get through aspects of it.
Now it's a matter of really being thoughtful about how you go through an exercise to relook at that so that you keep all the, you know, the benefits of what we've done, and you look for those ways. So that's why it just takes some time to do that, and so that'll happen over a bit of a longer period of time. You know, don't get lost in the fact that we've got a whole bunch of other stuff to do, right?
Yeah.
So, you know, we've got, we've got 200,000+ people. You know, we added 10,000 to do the risk and reg work. There's, you know, we still have a, you know, 195,000 people to sort and the, and the activities that they do to focus on and really get more efficient, plus all the other spend categories that I mentioned. So there's a, there's a lot more still to do.
So before I ask about capital, I did want to re-ask the M&A question a different way. As you know, this has really picked up as a topic in the fourth quarter of last year. It's really, it was very interesting, actually, and we hear Charlie loud and clear that the hurdle rate for Wells to grow inorganically is very, very high. You know, at the same time, the window for a GSIB to grow inorganically, particularly now, could be narrow. How does leadership balance those two considerations?
Well, different way to ask it, same answer. You know, I think, you know, when you look at the platform we've got, like we have a really enviable position, right? We've got scale in all of our key businesses. We feel no pressure at all to, like, do acquisitions to grow. We've got a tremendous amount of organic opportunity to grow in every single one of the businesses in the best market, you know, in the world to do that. And so the bar is high. And you know, obviously, you will, you'll.
If something special like came about, like, we'd look at it, but the bar is high, and we'd have to really make sure, you know, as Charlie and others have, and I've said, you know, a couple times now, it's like it really has to, you know, be something that really enhances the value of the overall, you know, franchise in a pretty significant way. But, you know, we're focused on really, you know, growing organically, and we'll see where it goes.
Great. And before I ask another question, just wanted to make sure the folks in the room know that if you scan the QR code and you submit the question, I'll get it in this iPad here, but we also have the old-fashioned way of the mic, so you have opportunities abound. So just quickly on capital, you know, as your, you know, Asset Cap was in place, your GSIB surcharge fell to 1.5%. You know, as you grow, it could obviously potentially move up to 2% at some point. How does that impact your thoughts on your target level for capital, CET1 in particular, and the buffer that you want to maintain over and above the reg minimum?
We've got a big buffer already.
Yeah.
And so any changes, like a couple of years in the making, right? And plus, you have, you know, the changes to the rules that could impact that. So I think in the short.
You mean the GSIB recalibration?
Yeah, yeah, yeah.
Yeah.
There, you know, the Fed's working on, you know, both Basel III and then looking at the GSIB recalibration, and so, you know, we'll see where it goes. In the short run, it's not, it's not impacting anything we're doing. I think we've got, you know, a lot of excess capital to continue to support growth and continue to support clients, and so I think that's a good place to be.
And so just finally, the lifting of the Asset Cap had a commensurate lifting impact on your valuation. Now that you're transitioning into a growth story, and that was very much, you know, very much resonated during this conversation, what are your key messages that you'd like to leave investors as you embark upon this next phase?
Yeah, look, we're a very different company than we were, you know, five or six years ago, and I think we're excited about, like, the opportunity to grow, and it's everywhere that we're growing is the strategies that we set three, four, five years ago, and we've been preparing, we've been investing, we've been making sure that we continue to have all the right people, the right technology, the right, you know, products that we've got to offer. And so every single one of the businesses has opportunity to grow, and we've, you know, we've kind of closed the chapter of simplifying the place, right? You know, we closed the last divestiture just in January with our railcar leasing business.
And so, you know, we've done everything we've set out to do to set ourselves up for the environment we're in now and post-Asset Cap, and now it's just down to execution. And I think we're excited, and we think we've got the right team, we've got the right, you know, the right position across every one of the businesses, and we're excited about just going after it. And it's just—it's, you know, it's as clear as can be in terms of the things that we need to do to get there. And I think the great part is it's, like, resonating, and we're seeing—we're starting to see it really come through the results in a really, really significant way across, you know, each of the businesses. And I think there's just a lot of opportunity from here to grow.
So it should be an exciting time for us as we go over the next few years.
That's great. So we may have time for one question in the audience, if anyone has it. We do have mics as well. All right. That was a very clear message, Mike. Thank you so much for joining us.