Wall Street Trivia

1) A Letter to the Treasury Secretary
Q : Which former CEO dared to address former US Treasury Secretary John Snow by name and express his disappointment in him?
A : Franklin Raines , ex - CEO of FNM

On Oct. 22, 2003, Raines sent Snow a letter.
"Dear John," it began. "From the beginning of our discussions, you and I
have agreed to avoid disrupting the capital markets by indicating a wish to change
Fannie Mae's charter, status, or mission. .....
.......
I am disappointed and hope we can change course. Very truly yours, Frank."


2) Mkt values of popular instruments circa Feb 2008
(all values are of par, ie, on the dollar)
High - grade CDOs : 75 - 35 c
Mezzanine CDOs : 50 - 10 c
HELOCs : 70 - 35 c
Junior lien mortgages (including prime) : 80 - 40 c

Bear in mind this was before the implosion of Bear Stearns and ensuing financial avalanche.
Goldman was pretty accurate n aggressive in marking all these down ASAP to the market.
Whereas ppl like Lehman and Merrill were largely in denial.


3) Extracts fr Wells Fargo's 2008 Annual Report
Bold headings are mine

Size means nth ... Unlike over at Bank of America
Size alone means nothing to us. You may have noticed: Nowhere above do I mention how big our combined company is in assets. Where we rank in asset size alone is meaningless to us. That’s because we did this merger to get better. In fact, to our customers, bigness can be a barrier. I’ve yet to hear of a customer walking into one of our banks and saying, “I want to bank here because you’re so … big!” Safe, secure and stable, yes. Friendly, hometown and approachable, yes. Smart, savvy, ethical, yes. But not just because we’re big. As we like to say: You don’t get better by getting bigger, you get bigger by getting better.

Opportunity in 2009
We made more loans at better price spreads while many of our competitors had to cut back.

Regardless of what the economy and the markets do in 2009, we focus on our vision and on doing what’s right for our customers. Now, more than ever before in our lifetimes, people need a safe, trustworthy, capable financial advisor who can partner with them to help plan and achieve their financial goals for a home,

Massive Cross Selling
We want to go beyond deposits and satisfy all the financial needs of Wachovia’s retail banking and brokerage households — not just deposits, loans and lines of credit, but their credit cards, debit cards, insurance, brokerage, 401(k)s, mortgage, home equity, and on and on.
Take a quick inventory of all your own household’s financial products.
You’ll probably come up with about 16, which you bought from several providers.
We believe you can save more time and money if you have all your products with one trusted provider that can off er you, and deliver on, a compelling value proposition.
The same goes for our business banking customers. We want to satisfy all their financial needs — not just their deposits, loans and lines of credit but their private banking, mortgage, treasury management, payroll processing, merchant processing, insurance, and on and on.

We want all our banking customers to think of us first for all their wealth management needs. Our goal is to be the most respected provider of wealth, brokerage and retirement services in the United States, number one, second to none.


Avoiding Irrational Lending
Irrational lenders come and go — mostly they go!
We will stay — as we have for 157 years through virtually every economic cycle — by lending responsibly, making high-quality loans to good customers, helping them succeed financially.
That’s why we’ve avoided most of the recent problems of the mortgage industry.
It’s why 93 of every 100 of our mortgage customers were current with their payments at year-end 2008, performance consistently better than the industry average.
We still make mortgage loans the old-fashioned way. We do not underwrite a mortgage loan unless we believe the borrower can repay it according to its terms.

We were able to contact 94 of every 100 of our mortgage customers who were two payments late.
We helped more than half of those 94 avoid foreclosure through refinancing, reducing payments, agreeing to new repayment plans, short sales (the proceeds are less than what the owner still owes on the mortgage), term extensions up to 40 years, reduced interest rates, no interest charge on part of the principal for some period of time and, in some markets, reduced principal — and making sure these modified loans are right for investors.