- Wells Fargo on Wednesday named Barry Sommers, the former CEO of wealth management at JPMorgan, as its new CEO of wealth and investment management. The post had been vacant since February.
- Scharf, who was previously with JPMorgan for nine years and long viewed as Jamie Dimon’s protégé, took on Sommers as the latest in a string of ex-JPMorgan men he’s hired since joining the bank last year.
- “Since he himself worked there at one time, in many cases he knows these people personally. He knows their working style, and they know his,” one analyst said.
- For more stories, sign up for our Wall Street Insider newsletter.
Wall Street has a high-stakes, closely watched revolving door of talent. And the JPMorgan-Wells Fargo link has been its own turnstile to watch.
On Wednesday afternoon, Wells Fargo alerted employees that it filled its vacant CEO of wealth and investment position with Barry Sommers, JPMorgan’s former chief executive of wealth management and a veteran of that firm.
Sommers will oversee the sprawling wealth division starting on June 22, and will report to Scharf, who called him a “proven leader” with deep wealth and asset management, brokerage, and private banking know-how.
He’ll be running the sprawling $1.6 trillion wealth and investment management (WIM) division, which includes Wells Fargo Advisors and its 13,450 financial advisers. Wells Fargo’s wealth management operation is the fourth-largest in the US.
Sommers, who will be based in New York, will grapple with a unit that’s lost some 1,600 advisers since the bank’s sales practices scandal broke out in 2016 and has shuffled some leadership over the last year including installing Julia Wellborn as head of private wealth. The business is also facing similar fee and tech pressures as its competitors, from dropping the cost of placing trades to fine-tuning its automated investing product.
His previous experience will be “welcome as we continue our transformation,” Scharf said in a statement.
Scharf, a former JPMorgan executive and the former chief executive of BNY Mellon and Visa, is charting that transformation after Wells Fargo’s wide-reaching sales practices scandal erupted four years and two CEOs ago. He joined the bank in October 2019.
With Sommers’ appointment, Scharf is continuing to hire men mostly with experience at JPMorgan, drawing on a pool of talent he’s intimately familiar with and that cannot be tied to Wells Fargo’s previous turmoil and mismanagement.
“Since he himself worked there at one time, in many cases he knows these people personally,” Gerard Cassidy, the head of US bank equity strategy and analyst at RBC Capital Markets, said in an interview on Wednesday. “He knows their working style, and they know his.”
Earlier this month, Business Insider reported the San Francisco bank was primarily considering outsiders for the wealth and investment management CEO post. WIM also encompasses private wealth management, which is comprised of the private bank and the Abbot Downing unit, as well as Wells Fargo Asset Management.
Sommers is at least the seventh JPMorgan alum Wells Fargo has taken on since Scharf, long viewed as Jamie Dimon’s protégé, started as CEO last October.
There’s head of public affairs Bill Daley, who was a former executive of JPMorgan and BNY Mellon. Ray Fischer, who heads up cards, retail, and merchant services, spent 14 years at JPMorgan in a similar unit there. Michael Cleary, who joined earlier this year to lead sales practices oversight and management, worked at JPMorgan for 13 years.
Meanwhile, Scott Powell, Wells Fargo’s chief operating officer, previously held several senior roles at JPMorgan; CEO of consumer lending and previous chief of Chase Home Lending Mike Weinbach joined earlier this year; and Munish Kumar, formerly a managing director at JPMorgan, is now chief information officer and head of wealth and investment management technology.
“Barry has been part of the leadership structure there,” Cassidy said of Sommers’ time at JPMorgan. “So bringing him to the table at Wells is a real positive for Wells.”
Sommers has experience running — and expanding — a wealth business inside a major US bank
Sommers will be steering the business at a unique moment as Wells Fargo is currently going to a sweeping transition.
Earlier this year, Scharf announced a reorganization, splitting three business lines into five; wealth was largely untouched by structural change — and in the wider wealth management and brokerage industry.
“We haven’t thought about how to really take advantage of our capabilities in our wealth business and deliver them through this broad-based consumer business that we have,” Scharf said during an industry conference hosted by Bernstein last month, according to a transcript from investment research platform Sentieo.
Scharf is putting his “own imprint” on Wells, said Ken Usdin, a senior equity research analyst at Jefferies.
“I would expect to see more appointments like this. Not necessarily from JPMorgan all the time, but I think there will be more change at the business line heads of Wells Fargo over time as Charlie continues to rethink both the strategy and composition of his executive team,” Usdin, who has met Sommers and called him “knowledgable and skilled in the businesses he’s run at JPMorgan,” said Thursday in a phone interview.
Going to another major US bank may not have been Sommers’ first choice, at least according to his old firm’s statement when he left JPMorgan in January 2019. He exited “to pursue interests outside of the corporate sphere,” the website AdvisorHub reported at the time, citing an internal memo.
Sommers worked at Bear Stearns in 2008 when it collapsed and was rescued by JPMorgan for $2 a share. He’d joined Bear in 1996, and spent time in Goldman Sachs’ asset management business before then.
He rose through the ranks at JPMorgan after the merger and in 2013 was named CEO of Chase’s consumer bank.
On Sommers’ watch, Chase wealth management grew deposits and investments in two years by 40% to some $200 billion, a 2013 company release said. Sommers also led the Chase Private Client unit’s expansion, the firm said.
In 2016, he shifted to what was then the newly formed Wealth Management and Investment unit, Business Insider reported at the time, citing an internal memo. He was named CEO of wealth management, and his counterpart Brian Carlin was named CEO of investment and banking solutions.
Read more:
- Uber-rich investors hungry for growth have turned their sights on the private market. Here’s how wealth firms like Citi and UBS are transforming their businesses to meet those client demands.
- Wells Fargo is eyeing even lower minimums for its robo-adviser as it looks to go head-to-head with Robinhood and Acorns
- A financial-adviser retirement wave that could put trillions of assets in play is kicking into high gear thanks to the pandemic. Here’s how firms are tackling the handover crisis.
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