In the banking industry, the market potential for Asia remains as hot a topic as ever. While the major US based banks have sought to expand and grow market share, hoping to gain a piece of IPO action and potentially billions of depositors, most ventures have been met with limited success. Wells Fargo (NYSE: WFC) hopes to be an exception to that.
The economic contraction under way in the Pacific Rim has forced many companies to rethink their model, and change their deployment of resources. Last week, the Minneapolis based Piper Jaffray Cos. Announced that it would sell or shut down its Hong Kong office. The high cost of doing business and difficult regulatory framework to navigate through makes it difficult for Western financial service firms to succeed in the expanding Asia Market. Wells Fargo & Co., the San Francisco based banking giant announced plans to increase its workforce in Asia by at least 10 percent in the next three years, a move that will add hundreds of employees in places like Hong Kong, Singapore and Tokyo as other financial companies cut back there.
The expansion plans of Wells Fargo are a stark contrast to its competitors currently. A recent Bloomberg Businessweek report noted that Royal Bank of Scotland is shutting units in Singapore and Korea, adding to the net job losses locally in the financial service industry.
Wells Fargo has been making bold moves since it’s Wachovia acquisition in 2008. The bank that once seemed content with it’s dominance of banking in the western part of the United States, now appears to have much more grand aspirations. Through its east cost expansion by rebranding Wachovia, and headcount additions in Asia, the future of Wells Fargo may look remarkably distant from its regional past.
