The most attractive part of Norwest is its many different channels of distribution. Instead of being just a branch banking company with maybe a website and ATMs, the company is the largest mortgage banker in the U.S. with 727 stores originating mortgages. It records revenues from this process in a complicated way that makes its financials a little harder to understand than other banks. This had been somewhat of a concern to me before I formed a better grasp on the accounting, but it's still not the easiest set of banking financials in the world to understand. For an explanation of the way accounting for securitizations works, see the appendix below.
Mortgages are commodities today.
Holding them isn't the most profitable thing in the world for a bank. Originating the mortgage, packaging it into securities that fit the varied needs of multiple investors, and servicing the mortgage consumes less capital on a perpetual basis and is more profitable. Like any commodity business, the company with the best process and best cost per unit of production will generate the best relative returns. That doesn't mean that over the long-term this is a great business to be in, because even the best producer in a highly commoditized business may not earn sufficient returns on capital. Over the foreseeable future, though, this unit of Norwest looks attractive.