You can see the challenge locally just by looking at U.S. Bank, where they ve been trying for two years to tear down the firewall between the bank and brokers at Piper Jaffray. He said Wells Fargo s effort to utilize Acordia s insurance agents in the 18 states where there are no Wells offices is an important test. It s the same challenge that State Farm Insurance is facing in asking its agents to sell banking products. As Wells Fargo and other financial companies enter a period when their markets and product opportunities appear to be boundless, Christopherson advises them to find a focus. The big winners, not in size or revenue but in return on equity, will be those companies that you can identify with a customer segment.
Customers look for a seller who knows their industry inside and out.
King said that niche focus is the approach Wells Fargo is taking. The Acordia acquisition was based on the strengths the two companies share in business niches, he said. They re strong in providing insurance for energy and gas companies, and that s a fit with our Colorado markets where Wells Fargo is the leading banker, he said. The companies also share strengths in higher education. Acordia is a leading insurer for colleges and universities, while Wells is the second largest educational finance lender.