History of Wells Fargo

1. History of Wells Fargo

1.1 Foundation of Wells Fargo

Due to the huge profits drawn by the California Gold Rush in early 1848, financiers and entrepreneurs from all over the world tried to set up their own business in California. On March 18 1852, Vermont native Henry Wells and New Yorker William G. Fargo have founded the Wells Fargo & Company (“Wells Fargo”) with an initial capitalization is US$ 300,000. Wells and Fargo were also the founders of American Express.

At the very beginning, Wells Fargo mainly focused on providing express and banking services to California as the government had no regulations on these two industries. The company offered diverse and mutually supportive services, including general forwarding and commissions, buying and selling of gold, as well as the freight service between New York and California. By subcontracting express services to established companies, rather than duplicating existing services, Wells Fargo gained its early success.

1.2 Major events experienced by Wells Fargo in the past

1.2.1 Early expansion and growth during 19th century

Holladay, which was also a transportation giant in 1860s, had strongly challenged Wells Fargo's operations and business at that time. Finally in late 1866, a showdown happened between the two companies and Wells Fargo purchased Holladay's operations. The 'grand consolidation' united Wells Fargo, Holladay, and Overland Mail lines and a new enterprise has been built under the Wells Fargo name.

The company then continued to expand rapidly. The number of banking and express offices grew from 436 in 1871 to 3,500 at end of 19th Century. During this period, Wells Fargo also successfully entered the East Coast markets and other regions such as Japan, Australia, Hong Kong, South America, Mexico, and Europe.

1.2.2 Moving from express business to banking industry

Wells Fargo separated its banking and express operations in 1905. In the same year, Well Fargo’s bank also merged with the Nevada National Bank to form the Wells Fargo Nevada National Bank. After the survival of the bank from the 1906 San Francisco earthquake and fire, the bank's deposits surged due to the money flowed into San Francisco to support the reconstruction.

Unfortunately, the US government forced the company to consolidate its domestic operations with those of the other major express companies. The government then took over the nation’s express network as part of its effort in the First World War. Wells Fargo was left with just one bank in San Francisco.

1.2.3 Acquiring and merging with other financial institutions in 20th Century

In the 1910s and 1920s, Wells Fargo served as a commercial bank in San Francisco, supporting the west side of American growing business and agriculture,