Wells Fargo & Company (WFC) 8-K Wells Fargo Reports Record Net Income

Exhibit 99.1

Media		Investors
Janis Smith 415-396-7711	Julia Tunis Bernard 415-222-3858	Bob Strickland 415-396-0523	Jim Rowe 415-396-8216

Wednesday, July 22, 2009

WELLS FARGO REPORTS RECORD NET INCOME

• Another quarter of record earnings

– Record Wells Fargo net income of $3.17 billion, up 81 percent from last year; $6.22 billion for six months ended June 30, 2009, up 66 percent from last year

– Net income applicable to common stock of $2.58 billion, up 47 percent from last year; $4.96 billion for six months ended June 30, 2009, up 32 percent from last year

– Diluted earnings per common share of $0.57, up 8 percent from last year, after $700 million credit reserve build ($0.10 per common share), FDIC special assessment of $565 million ($0.08 per common share) and merger-related and restructuring expenses of $244 million ($0.03 per common share)

• Record revenue

– Record revenue of $22.5 billion, up 28 percent (annualized) from first quarter

– Legacy Wells Fargo revenue of $13.6 billion, up 19 percent from last year; year-to-date legacy Wells Fargo revenue of $25.9 billion, up 18 percent

– Wachovia contributed 39 percent of consolidated revenue

– $206 billion of credit extended to customers in the quarter

– Average checking and savings deposits up 20 percent (annualized) from first quarter

– Net interest margin of 4.30 percent, up 14 basis points from first quarter

– Cross-sell ratio for legacy Wells Fargo a record 5.84 for retail bank households and 6.4 for wholesale and commercial customers

– Broad-based revenue contribution from diverse businesses, with particular strength in regional banking, commercial banking, mortgage banking, investment banking, asset-based lending, auto lending, student lending, debit card, merchant card, wealth management, securities brokerage, retirement services and international

– Pre-tax pre-provision profit¹ of $9.8 billion, up 27 percent (annualized) from $9.2 billion in prior quarter

¹ See footnote (4) on page 18 for information about pre-tax pre-provision profit.

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• Generated $14.2 billion from market and internal sources toward the Supervisory Capital Assessment Program (SCAP) $13.7 billion requirement

– While SCAP process will not be completed until the third quarter is finished, already exceeded requirement by $500 million and expect to internally generate additional SCAP-qualifying capital in third quarter

• Further strengthened balance sheet

– Credit reserve build of $700 million, bringing allowance for credit losses to $23.5 billion, 2.86 percent of total loans and 1.5 times nonperforming loans

– Allowance for credit losses covers expected consumer loan losses for approximately the next 12 months and inherent commercial and commercial real estate loan losses expected to emerge over approximately the next 24 months

– Continued reduction of higher-risk assets, with higher-risk loan portfolios reduced by $6.3 billion (indirect home equity and indirect auto at legacy Wells Fargo, Pick-a-Pay and commercial real estate at Wachovia) and trading assets reduced by $6.4 billion

– Securities portfolio written down by $463 million for other-than-temporary impairment (OTTI)

– Capital ratios increased significantly in the quarter (See table on page 26 for more information)

	Quarter ended
	June 30,			March 31,
(as a percent of total risk-weighted assets)	2009			2009
Tier 1 capital		9.80	%		8.30	%
Tier 1 common equity		4.49			3.12
Tangible common equity		5.24			3.84

• Credit performance met expectations, with some signs of stabilization in certain loan portfolios

– Net charge-offs of $4.39 billion compared with $3.26 billion in first quarter

– Nonaccrual loans increased to $15.8 billion

– Rate of increase in losses in several consumer and Business Direct portfolios showing early signs of moderation, largely due to the Company’s actions to reduce risk beginning two years ago, and early stage delinquencies moderating in some consumer portfolios

• Wachovia integration proceeding as expected

– Business and revenue synergies ahead of expectations

– On track to realize annual run-rate savings of $5 billion upon full integration

– Completed re-branding of Wachovia brokerage, capital markets and insurance businesses as Wells Fargo Advisors, Wells Fargo Securities and Wells Fargo Insurance Services, respectively

– First state community bank conversion, Colorado, to Wells Fargo systems/brand scheduled for November; conversion of remaining market overlap states (California, Arizona, Illinois, Nevada and Texas) expected to begin early next year and continue throughout 2010

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• Helped nearly one million American homeowners lower mortgage payments or restructure mortgages in first half of 2009

– Refinanced approximately 750,000 customers’ mortgages using theHome Affordable Refinance Program(HARP) and other standard refinance programs

– Provided more than 200,000 trial and completed modifications through theHome Affordable Modification Program(HAMP) and Company’s own proprietary programs

SAN FRANCISCO — Wells Fargo & Company (NYSE: WFC) reported diluted earnings per common share of $0.57 for second quarter 2009 compared with $0.56 for first quarter 2009 and $0.53 for second quarter 2008. (Results prior to January 1, 2009, do not include Wachovia.) Wells Fargo net income was a record $3.17 billion for second quarter 2009 and $6.22 billion for the first six months of 2009. “Our very strong growth in revenue, deposits and net income this quarter and the first half of this year demonstrates again that the combined Wells Fargo-Wachovia has significant power to generate capital internally,” said President and CEO John Stumpf. “Thanks to the customer focus of our 282,000 talented team members, our revenue rose 28 percent (annualized) from first quarter as we set new cross-sell records and gained even more market share by satisfying all our customers’ financial needs and helping them succeed financially. At legacy Wells Fargo, 41 percent of our retail households have a cross-sell ratio over six, and one out of every four retail households now have at least eight products with us. Our Wachovia team members also contributed significantly to our results this quarter and the first half of the year, generating 39 percent of consolidated second quarter revenue. Wells Fargo Advisors (formerly Wachovia Securities) was ranked #1 by Forrester Research among all investment/brokerage firms based on client perceptions for ‘doing what’s best for me and my household.’

“Our top priority is to integrate Wachovia into Wells Fargo as smoothly and efficiently as possible to benefit our 70 million customers, which equals about one of every three U.S. households. The Wells Fargo-Wachovia integration is on track. In November, Colorado will become our first community banking state to convert Wachovia’s financial centers to Wells Fargo systems, brand and sales processes — a conversion process that will continue deliberately and thoughtfully, region by region and state by state, throughout next year and into 2011.

“Our team achieved these results while undertaking the largest merger integration in U.S. banking history and despite the challenging economy. We intend to pay back the government’s investment in Wells Fargo on behalf of U.S. taxpayers in a shareholder-friendly way. We will work closely with our regulators to determine the appropriate time to repay the funds while maintaining strong capital levels.”

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Financial Performance

“We’re very pleased with the Company’s accomplishments and results this quarter,” said Chief Financial Officer Howard Atkins. “We earned another record profit — $3.17 billion — after earning $3.05 billion in first quarter. We continued to profitably build our franchise for the long term, with revenue up 28 percent (annualized) linked quarter across multiple, diverse business lines. We’ve extended more than $471 billion of loans to creditworthy customers since October 2008, including $206 billion in new loan commitments and originations this quarter. Our net interest margin increased to 4.30 percent, largely reflecting what we believe is the best core customer deposit base among large banks, with checking and savings deposits up 20 percent (annualized) this quarter. We took many actions to further strengthen our balance sheet, including building credit reserves to $23.5 billion and building Tier 1 common equity to $47.1 billion, or 4.49 percent of risk-weighted assets, and building Tier 1 capital to 9.8 percent of risk-weighted assets. While the Supervisory Capital Assessment Program (SCAP) will not be completed until after the third quarter is finished, we have already generated $14.2 billion from market and internal sources toward the $13.7 billion capital buffer required by the Federal Reserve and expect to generate additional capital internally in the third quarter. We’re seeing some signs of moderation in consumer and small business credit losses, largely due to our efforts over the last two years to modify and restructure loans for our customers, our successful efforts to reduce high risk loan portfolios and the write-downs we already took in Wachovia’s loan portfolios. The Wachovia integration remains on track, with business and revenue synergies already exceeding our expectations.”

Revenue

Record revenue of $22.5 billion increased 28 percent (annualized) from first quarter 2009. Year-to-date revenue was $43.5 billion, almost double legacy Wells Fargo’s revenue for the comparable period last year. “We continued to have a very good balance in our revenue generation between commercial and retail, between spread income and fee income, and between legacy Wells Fargo and Wachovia,” said Atkins. “The vast majority of our more than 80 businesses grew revenue again this quarter, including the following diverse businesses that all achieved greater than 8 percent (annualized) linked-quarter growth: regional banking, mortgage banking, investment banking/capital markets, asset-based lending, auto lending, student lending, debit card, merchant card, wealth management, securities brokerage, retirement services and international.”

Net Interest Income

Net interest income was $11.8 billion, up 14 percent (annualized) from $11.4 billion in first quarter 2009. Average earning assets were up $1.3 billion linked quarter, with an increase of $30.7 billion in securities and mortgage loans held for sale. This increase was partially offset by a reduction of $3.7 billion in average trading assets and a reduction of $21.6 billion in average loans, including $6.3 billion in the higher-risk loan portfolios that the Company has been exiting, such as indirect home equity and indirect auto from legacy Wells Fargo, and Wachovia’s Pick-a-Pay and commercial real estate portfolios. “At 4.30 percent, our net interest margin remained the best among our large bank peers and reflected the

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benefit of continued growth in core customer deposits,” said Atkins. “About 80 percent of our core deposits are now in checking and savings deposits, one of the highest percentages in the industry.”

Loans

Average total loans were $833.9 billion compared with $855.6 billion in first quarter 2009, reflecting more moderate consumer and commercial demand for credit, as well as the Company’s actions to reduce certain higher-risk loan portfolios. Average total loans included $159.6 billion of these loans in the portfolios that the Company is running off, down $6.3 billion, or 15 percent (annualized) from first quarter and $10.9 billion year-to-date. “We continue to extend credit and meet loan demand for all of our credit-worthy borrowers,” said Atkins.

Deposits

Average total core deposits were $765.7 billion compared with $753.9 billion in first quarter 2009. Average consumer checking and savings deposits increased 20 percent (annualized) to $613.3 billion, from $583.8 billion in first quarter 2009. Average mortgage escrow deposits were $32.0 billion, compared with $25.2 billion in first quarter 2009. Average consumer checking accounts at legacy Wells Fargo grew a net 6.5 percent from second quarter 2008, and for Wells Fargo and Wachovia combined, grew a net 9.5 percent in California for the same period. During the quarter, $24 billion of Wachovia’s higher-cost certificates of deposit matured and were replaced by $14 billion in checking, savings or lower-cost CDs. “We continue to see strong core deposit growth across all customer segments as we gain new customers, deepen our market penetration and expand relationships with existing customers,” said Atkins.

Noninterest Income

Noninterest income of $10.7 billion increased 46 percent (annualized) from $9.6 billion in first quarter 2009 and included:

• Mortgage banking income of $3.0 billion, including:

– $2.2 billion in revenue from mortgage loan originations/sales activities on $129 billion of originations, including net write-downs of the mortgage warehouse for spread and other liquidity-related valuation adjustments

– Mortgage applications of $194 billion, one of the Company’s highest quarters, with an unclosed application pipeline of $90 billion at quarter end

– $1.0 billion mortgage servicing rights (MSRs) mark-to-market gains, net of hedge results, reflecting a $2.3 billion increase in the fair value of the MSRs offset by a $1.3 billion economic hedge loss in the quarter, with the net difference largely due to hedge carry income reflecting low short-term rates, which are likely to continue; MSRs as a percent of loans serviced of 0.91 percent

• Trust and investment fees of $2.4 billion, up 36 percent (annualized) linked quarter primarily reflecting equity and bond origination fees and higher brokerage commissions as the Company builds

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its retail securities brokerage business; Client assets in Wealth, Brokerage and Retirement up 8 percent linked quarter

• Card and other fees of $1.9 billion, up 30 percent (annualized) linked quarter reflecting seasonally higher purchase volumes and higher customer penetration rates

• Service charges on deposit accounts of $1.4 billion, up 16 percent (annualized) linked quarter driven by continued strong checking account growth

• Trading revenue of $749 million, with approximately two-thirds related to customer transactions

• Net losses on debt and equity securities totaling $38 million, including $463 million of OTTI write-downs. Net losses on debt securities of $78 million included OTTI of $308 million net of realized gains of $230 million. Net gains on equity securities totaled $40 million after $155 million of OTTI write-downs.

At June 30, 2009, the Company had net unrealized losses on securities available for sale reflected in equity of only $400 million, down from losses of $4.7 billion at March 31, 2009. “The net unrealized losses were virtually eliminated as credit spreads narrowed during the quarter and as unrealized gains emerged on new mortgage-backed securities (MBS) purchased during the quarter at the peak in MBS yields,” said Atkins.

Noninterest Expense

Noninterest expense was $12.7 billion compared with $11.8 billion in first quarter. The increase was due to the FDIC special assessment of $565 million and higher variable compensation in mortgage, brokerage, and investment banking related to increased customer sales. Noninterest expense also included $244 million of merger-related costs. “We continued to hire new sales professionals in the quarter in our regional bank and retail securities brokerage business while improving sales force productivity,” said Atkins. “In addition, we opened 12 banking stores during the quarter. Even though we continue to invest appropriately in our business for long-term revenue growth, expenses were relatively flat overall reflecting the benefit of the consolidation of the two companies, and ongoing expense management initiatives.” Including the FDIC special assessment and merger costs, which together represented 6 percent of total noninterest expense during the quarter, the efficiency ratio was 56.4 percent, flat from first quarter’s 56.2 percent.

Capital

The Company continued to build capital in the second quarter. As a percentage of total risk-weighted assets, Tier 1 capital, tangible common equity, and Tier 1 common equity increased to 9.80 percent, 5.24 percent, and 4.49 percent, respectively, at June 30, 2009, up from 8.30 percent, 3.84 percent, and 3.12 percent, respectively, at March 31, 2009. “As we previously stated, the Federal Reserve asked us to generate a $13.7 billion regulatory capital buffer by November 9, 2009, based on what we believed were their extremely conservative revenue assumptions in the adverse case scenario,” said Atkins. “At June 30, 2009, with over a quarter to go before the SCAP plan is completed, we have exceeded this requirement by

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$500 million. We accomplished this through an $8.6 billion equity raise, and internally generated capital including $2.4 billion of pre-provision net revenue (pre-tax pre-provision profit plus certain SCAP adjustments) in excess of the Federal Reserve’s estimate, $2.7 billion realization of deferred tax assets and $500 million of other internally generated sources of capital, including core deposit intangible amortization. We expect to realize additional internally generated SCAP-qualifying capital in the third quarter which will add to the amount already generated in the second quarter. Our actual pre-provision net revenue for the first two quarters of 2009 was above our own SCAP projection and surpassed the Federal Reserve’s projection by $4.2 billion, or 27 percent.” See footnote (4) on page 18 and the table on page 26 for more information.

Credit Quality²

“Credit losses rose in the second quarter, as expected, due to the weak economy and higher unemployment in the quarter,” said Chief Credit Officer Mike Loughlin. “We expect credit losses and nonperforming assets to increase, although we’re beginning to see some moderation in the rate of growth of losses in a number of consumer portfolios, as evidenced by some stabilization in early stage delinquencies, largely the result of actions we’ve taken over the last two years to reduce risk.”

Net Loan Charge-Offs

	Quarter ended									Quarter ended
	June 30, 2009									March 31, 2009
							As a					As a
							% of					% of
							average			Net loan		average
							loans			charge-		loans
	Net loan charge-offs						(annualized)			offs		(annualized)
	Legacy
	Wells
($ in millions)	Fargo		Wachovia		Consolidated					Consolidated
Commercial and commercial real estate:
Commercial	$	605	$	99	$	704		1.51	%	$	556		1.15	%
Other real estate mortgage		86		60		146		0.56			21		0.08
Real estate construction		190		42		232		2.76			103		1.21
Lease financing		16		45		61		1.68			17		0.43
Total commercial and commercial real estate		897		246		1,143		1.35			697		0.80
Consumer:
Real estate 1-4 family first mortgage		410		348		758		1.26			391		0.65
Real estate 1-4 family junior lien mortgage		991		180		1,171		4.33			847		3.12
Credit card		605		59		664		11.59			582		10.13
Other revolving credit and installment		456		148		604		2.66			696		3.05
Total consumer		2,462		735		3,197		2.77			2,516		2.16
Foreign		43		3		46		0.61			45		0.56
Total	$	3,402	$	984	$	4,386		2.11		$	3,258		1.54

² See explanation on page 39 of the accounting for credit-impaired loans acquired from Wachovia accounted for under SOP 03-3, and the impact on selected financial ratios.

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Second quarter net charge-offs were $4.4 billion, or 2.11 percent of average loans, compared with first quarter net charge-offs of $3.3 billion, or 1.54 percent of average loans. Legacy Wells Fargo net charge-offs were $3.4 billion compared with $2.9 billion in first quarter 2009 and Wachovia net charge-offs totaled $984 million compared with $371 million in first quarter 2009. “As a result of our merger, the Wachovia loans with the highest expected loss content were classified as impaired and the expected life of loan loss content was reflected in purchase accounting write-downs at December 31, 2008,” said Loughlin. “The remaining non-impaired portfolio, by definition, should have lower loss content. The losses in the non-impaired portfolio increased in the quarter as anticipated given the effects of purchase accounting and portfolio deterioration. We expect the non-impaired portfolios to perform significantly better than the impaired portfolios that have already been written down through purchase accounting.

“We continue to take actions to reduce risk in the portfolio and invest in loss mitigation activities. We took significant write-downs in the Wachovia portfolio in purchase accounting; we have exited several higher risk non-strategic businesses and are liquidating these portfolios, such as Pick-a-Pay, legacy Wells Fargo indirect auto and the broker-originated home equity portfolios. We continue to monitor credit standards to improve the credit quality of new loans, all in an effort to reduce the risk in the portfolio while continuing to originate appropriately priced new business for our customers. Even with the challenges that remain, our teams are effectively working together to manage the risk, and the Wells Fargo credit culture is being implemented across the combined company.”

Commercial and commercial real estate net charge-offs totaled $1.1 billion, including $897 million from legacy Wells Fargo and $246 million from Wachovia, a combined increase of $446 million linked quarter. “As expected, the challenging economy affected the commercial portfolios, and more specifically those portfolios tied to the residential real estate industry,” said Loughlin. “We believe that our disciplined underwriting, the write-downs previously recognized through purchase accounting and our diligent work with challenged borrowers will contain the growth in losses going forward.”

Net charge-offs in the 1-4 family first mortgage portfolio totaled $758 million, including $410 million from legacy Wells Fargo and $348 million from Wachovia, a combined increase of $367 million linked quarter. “The loss levels in our 1-4 family first mortgage portfolio increased as expected, in part due to increased loan modifications and the lifting of the foreclosure moratorium,” said Loughlin. “While we are seeing some encouraging signs of home sales in California, housing prices need to stabilize broadly before credit results in the mortgage portfolio will improve.” Credit card charge-offs increased $82 million linked quarter to $664 million. “While late stage delinquencies and loss rates continue to be challenged by the high levels of unemployment and bankruptcies, we are beginning to see some stabilization in early stage delinquency in the unsecured consumer loan portfolios. Losses in the auto portfolio fell modestly in the quarter as we’ve worked through some of the poorer performing vintages and used car pricing has improved.”

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Net charge-offs in the real estate 1-4 family junior lien portfolio totaled $1.2 billion, including $991 million from legacy Wells Fargo and $180 million from Wachovia, a combined increase of $324 million from first quarter 2009. “The rate of decline in home values appears to be moderating in a number of markets,” said Loughlin. “While the loss amounts are directly correlated to these property values, other events affecting the consumer, such as unemployment, drive the loss frequency. Many of our home equity losses involve customers who are having problems with their first mortgage due to unemployment or over-indebtedness. Additionally, as more customers seek to modify their first mortgages, there may be an adverse effect on the credit performance of junior lien holders behind these modifications.” More information about the Home Equity portfolio is available on page 40.

Nonaccrual Loans and Other Nonperforming Assets

	June 30, 2009															March 31, 2009
	Legacy		As a %					As a %					As a %					As a %
	Wells		of total					of total					of total					of total
($ in millions)	Fargo		loans			Wachovia		loans			Consolidated		loans			Consolidated		loans
Commercial and commercial real estate:
Commercial	$	2,100		2.14	%	$	810		0.97	%	$	2,910		1.60	%	$	1,696		0.88	%
Other real estate mortgage		1,057		2.12			1,286		2.39			2,343		2.26			1,324		1.26
Real estate construction		1,991		10.72			219		1.49			2,210		6.65			1,371		4.04
Lease financing		112		1.51			18		0.25			130		0.89			114		0.77
Total commercial and commercial real estate		5,260		3.02			2,333		1.46			7,593		2.28			4,505		1.30
Consumer:
Real estate 1-4 family first mortgage		3,975		4.93			2,025		1.29			6,000		2.53			4,218		1.74
Real estate 1-4 family junior lien mortgage		1,415		1.95			237		0.69			1,652		1.54			1,418		1.29
Other revolving credit and installment		297		0.64			30		0.07			327		0.36			300		0.33
Total consumer		5,687		2.59			2,292		0.96			7,979		1.74			5,936		1.27
Foreign		67		1.19			159		0.65			226		0.75			75		0.24
Total nonaccrual loans		11,014		2.76			4,784		1.13			15,798		1.92			10,516		1.25
Foreclosed assets:
GNMA loans		932					—					932					768
All other		809					783					1,592					1,294
Total foreclosed assets		1,741					783					2,524					2,062
Real estate and other nonaccrual investments		20					—					20					34
Total nonaccrual loans and other nonperforming assets	$	12,775		3.20		$	5,567		1.32		$	18,342		2.23		$	12,612		1.50

Total nonperforming assets were $18.3 billion (2.23 percent of total loans) at June 30, 2009, and included $15.8 billion of nonaccrual loans and $2.5 billion of foreclosed assets (repossessed real estate and vehicles). Nonaccrual loans increased $5.3 billion from March 31, 2009, with increases in both the commercial and consumer portfolios.

“The increase in nonaccrual loans was attributable to four factors,” said Loughlin. “First, about 60 percent of the increase came from Wachovia’s non-impaired loan portfolios. This increase was expected and is primarily the natural result of experiencing new inflows to nonaccruals after having virtually eliminated

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Wachovia’s nonaccruals at the end of the year through purchase accounting write-downs. Going forward the increase in nonaccrual loans attributable to this effect will be much less significant. Second, the economics to liquidate assets in this market remain challenging and may cause us to temporarily hold onto assets longer. Third, we’ve increased the number of loan modifications and other strategies to keep our customers in their homes. These newly modified loans may remain in nonperforming assets until they demonstrate performance. And finally, we have seen some deterioration in certain portfolios, particularly commercial real estate, as some borrowers are distressed. Not all nonaccrual loans turn into future credit losses. The vast majority are secured by residential or commercial real estate, and some write-downs may already have occurred as loans migrated through delinquency buckets. We firmly believe our approach to managing nonaccruals to minimize loss over time is sound, although the result will be continued high levels of nonaccruals until economic conditions improve—a dynamic factored into our reserving methodology.”

Loans 90 Days or More Past Due and Still Accruing
(Excluding Insured/Guaranteed GNMA and Similar Loans)
Includes Wells Fargo and Wachovia

	June 30,		March 31,
(in millions)	2009		2009
Commercial and commercial real estate:
Commercial	$	415	$	417
Other real estate mortgage		702		355
Real estate construction		860		624
Total commercial and commercial real estate		1,977		1,396
Consumer:
Real estate 1-4 family first mortgage		1,497		1,361
Real estate 1-4 family junior lien mortgage		660		598
Credit card		680		738
Other revolving credit and installment		1,160		1,105
Total consumer		3,997		3,802
Foreign		32		29
Total loans	$	6,006	$	5,227

*The table above does not include loans acquired from Wachovia accounted for under SOP 03-3 that were contractually 90 days past due and still accruing. These loans have a related nonaccretable difference that will absorb future losses, therefore charge-offs on these loans are not expected to reduce income in future periods to the extent that actual future loan performance is consistent with original estimates.

Loans 90 days or more past due and still accruing totaled $16.7 billion at June 30, 2009, and $14.7 billion at March 31, 2009. For the same periods, the totals included $10.7 billion and $9.5 billion, respectively, in advances pursuant to the Company’s servicing agreement to GNMA mortgage pools and similar loans whose repayments are insured by the Federal Housing Administration or guaranteed by the Department of Veterans Affairs.

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Allowance for Credit Losses
(Includes Wells Fargo and, beginning December 31, 2008, Wachovia)

The allowance for credit losses, including the reserve for unfunded commitments, totaled $23.5 billion at June 30, 2009, compared with $22.8 billion at March 31, 2009. Second quarter 2009 results included a credit reserve build of $700 million, primarily for higher losses in several consumer credit portfolios, increased levels of residential real estate modifications classified as troubled debt restructurings and expected deterioration in the wholesale portfolios and commercial non-SOP 03-3 impaired loans. The allowance coverage to total loans increased to 2.86 percent compared with 2.71 percent at March 31, 2009, and covered expected consumer losses for approximately the next 12 months and inherent commercial and commercial real estate loan losses expected to emerge over approximately the next 24 months. “We believe the allowance was adequate for losses inherent in the loan portfolio at June 30, 2009, including both performing and nonperforming loans,” said Loughlin.

Business Segment Performance

Wells Fargo defines its operating segments by product type and customer segment. Segment net income for each of the three business segments was:

	Quarter ended
	June 30,		Mar. 31,
(in millions)	2009		2009
Community Banking	$	2,008	$	1,839
Wholesale Banking		1,067		1,180
Wealth, Brokerage and Retirement Services		363		259

More financial information about the business segments is on pages 34 and 35.

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Community Bankingoffers a complete line of diversified financial products and services for consumers and small businesses including investment, insurance and trust services in 39 states and D.C., and mortgage and home equity loans in all 50 states and D.C.

Selected Financial Information

	Quarter ended
	June 30,		Mar. 31,
(in millions)	2009		2009
Total revenue	$	14,807	$	13,953
Provision for credit losses		4,264		4,004
Noninterest expense		7,665		7,158
Segment net income		2,008		1,839
(in billions)
Average loans		540.7		552.8
Average assets		799.2		797.9
Average core deposits		543.9		538.0

Community Banking reported net income of $2.0 billion in second quarter 2009, up $169 million, or 9 percent, from first quarter. Revenue increased $854 million, or 6 percent, driven by an increase in net interest margin and strong regional banking and mortgage banking fee income. Noninterest income increased $567 million, or 10 percent, from prior quarter driven by continued strength in mortgage banking and strong growth in deposit service charges and card fees. Noninterest expense increased $507 million, or 7 percent, due primarily to FDIC and other deposit assessments. The provision for credit losses increased $260 million, and included a $479 million credit reserve build compared with a $1 billion credit reserve build in the prior quarter.

Regional Banking Highlights for Legacy Wells Fargo

• Core product solutions (sales) of 6.38 million, up 14 percent from prior year on a comparable basis

• Core sales per platform banker FTE (active, full-time equivalent) of 5.64 per day, up from 5.18 in prior year on a comparable basis

• Record retail bank household cross-sell of Wells Fargo products of 5.84 products per household; 25 percent of retail bank households had 8 or more products, our long-term goal

• Sales ofWells Fargo Packages^® (a checking account and at least three other products) up 19 percent from prior year, purchased by 76 percent of new checking account customers

• Customer loyalty scores up 4 percent, and welcoming and wait time scores up 7 percent from prior year (based on customers conducting transactions with tellers)

• Business Banking

o Store-based business solutions up 16 percent from prior year

o Business Banking household cross-sell of 3.69 products per household

o Sales ofWells Fargo Business Services Packages(business checking account and at least three other business products) up 28 percent from prior year, purchased by 55 percent of new business checking account customers

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Regional Banking Highlights for Wachovia

• Retail bank household cross-sell of Wachovia products of 4.55 products per household

• Record customer experience scores, maintained already very high levels

Combined Regional Banking

• Consumer checking accounts up a net 5.5 percent from prior year

• Business checking accounts up a net 3.9 percent from prior year

• Opened 12 banking stores and converted 31 retail stores from Century Bancshares for retail network total of 6,668

• 12,353 ATMs across our network, including 2,681Envelope-Free^SMwebATMmachines

• #1 national SBA lender in both units and dollar volume (combined with Wachovia) through June 30 (the first nine months of the government’s fiscal year)

Online Banking

• 15.9 million active online customers, including Wachovia

• 3.8 million active Bill Pay customers, including Wachovia

• Brookings Institution ranked Wells Fargo as #1 web site out of 68 leading U.S. corporations for technology innovation

Home Mortgage

• Mortgage applications of $194 billion, up from $190 billion in prior quarter

• Mortgage application pipeline of $90 billion at quarter end, down from $100 billion at March 31, 2009

• Home Mortgage originations of $129 billion, up from $101 billion in prior quarter

• Owned residential mortgage servicing portfolio of $1.7 trillion, up from $1.6 trillion at March 31, 2009

Wells Fargo Financial

• Average loans of $62.5 billion compared with $65 billion in prior quarter

• Debt consolidation loans of $24.3 billion compared with $25 billion in prior quarter

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Wholesale Bankingprovides financial solutions to businesses across the United States with annual sales generally in excess of $10 million and financial institutions globally. Products include middle market banking, corporate banking, commercial real estate, treasury management, asset-based lending, insurance brokerage, foreign exchange, correspondent banking, trade services, specialized lending, equipment finance, corporate trust, investment banking, capital markets and asset management.

Selected Financial Information

	Quarter ended
	June 30,		Mar. 31,
(in millions)	2009		2009
Total revenue	$	5,238	$	4,907
Provision for credit losses		738		545
Noninterest expense		2,807		2,531
Segment net income		1,067		1,180
(in billions)
Average loans		263.5		271.9
Average assets		381.7		403.8
Average core deposits		138.1		138.5

Wholesale Banking reported net income of $1.07 billion in second quarter 2009, compared with $1.18 billion in first quarter 2009. Revenue increased $331 million, primarily due to strong results in investment banking and capital markets. Noninterest expense increased $276 million, primarily due to higher FDIC assessments. The provision for credit losses was $738 million, an increase of $193 million from first quarter 2009, and included $576 million from net charge-offs and $162 million of additional provision recorded to build reserves for the wholesale portfolio.

• Customer-focused investment banking revenue up 29 percent from prior quarter driven by strength in high-grade and high-yield debt and equity issuances and M&A advisory services

• Consistently strong trading results continued across all customer-centric capital markets businesses, including fixed income, equities and interest rate activities

• Asset-based lending revenue up 13 percent from prior quarter due to large volume of lead positions and competitive re-pricing

• Commercial Real Estate Group continued to originate high-quality commercial real estate loans at improved spreads and terms, with spreads on new commitments up 19 percent linked quarter

• Through first half of 2009, customers deposited more than $1 trillion through Check 21 solutions, including the award-winningDesktop Deposit^® service

• ActiveCommercial Electronic Office^® portal users up 19 percent from prior year, and customers continued to initiate and receive more payments electronically than through checks

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Wealth, Brokerage and Retirementprovides a full range of financial advisory services to clients using a comprehensive planning approach to meet each client’s needs. Wealth Management provides affluent and high net worth clients with a complete range of wealth management solutions including financial planning, private banking, credit, investment management and trust. Family Wealth meets the unique needs of the ultra high net worth customers. Retail brokerage’s financial advisors serve customers’ advisory, brokerage and financial needs as part of one of the largest full-service brokerage firms in the U.S. Retirement provides retirement services for individual investors and is a national leader in 401(k) and pension record keeping.

Selected Financial Information

	Quarter ended
	June 30,		Mar. 31,
(in millions)	2009		2009
Total revenue	$	2,986	$	2,639
Provision for credit losses		115		25
Noninterest expense		2,289		2,219
Segment net income		363		259
(in billions)
Average loans		45.9		46.7
Average assets		110.2		104.0
Average core deposits		113.5		102.6

Wealth, Brokerage and Retirement reported net income of $363 million, up 40 percent linked quarter. Second quarter earnings were driven by increased brokerage transaction activity, improved market valuations, strong deposit growth and securities gains.

Retail Brokerage

• Client assets increased 8 percent to $986 billion from prior quarter

• Managed account assets increased $22 billion, or 16 percent, from prior quarter, including net inflows of $10 billion

• Continued strong broker recruiting — financial advisors hired this year are 60 percent more productive than those who have left the firm

• Brokerage average sweep deposits up 6 percent from prior quarter

• Wachovia Securities rebranded as Wells Fargo Advisors

Wealth Management

• Average deposits up 19 percent from prior quarter, led by continued growth in theUnlimited NOWaccount product

• Private banking revenue up 20 percent from prior quarter on strong deposit growth

Retirement

• Retirement plan assets of $250 billion, up $27 billion, or 12 percent, from prior quarter

• IRA assets of $212 billion, up $20 billion, or 10 percent, from prior quarter

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Recorded Message

A recorded message reviewing Wells Fargo’s results is available at 5:30 a.m. Pacific Time through July 25, 2009. Dial 866-416-0522 (domestic) or 706-902-3479 (international). No password is required. The call is also available online at wellsfargo.com/invest_relations/earnings.

Cautionary Statement About Forward-Looking Information

In accordance with the Private Securities Litigation Reform Act of 1995, we caution you that this news release contains forward-looking statements about our future financial performance and business. We make forward-looking statements when we use words such as “believe,” “expect,” “anticipate,” “estimate,” “should,” “may,” “can,” “will” or similar expressions. Forward-looking statements in this news release include, among others, the following statements: we expect to internally generate additional SCAP-qualifying capital in the third quarter; in November, Colorado will become our first community-banking state to convert Wachovia’s financial centers to Wells Fargo’s systems, brand and processes-a conversion process that will continue throughout next year and into 2011; we intend to pay back the government’s investment in Wells Fargo on behalf of U.S. taxpayers in a shareholder-friendly way; short-term rates, for purposes of hedge carry income, will likely continue to be low; we expect credit losses and nonperforming assets to increase; the Wachovia non-impaired portfolio should have lower loss content; we expect Wachovia’s non-impaired portfolios to perform significantly better than the impaired portfolios that have already been written down through purchase accounting; we believe that our disciplined underwriting, the write-downs previously recognized through purchase accounting and our diligent work with challenged borrowers will reduce losses going forward; housing prices need to stabilize broadly before credit results in the mortgage portfolio will improve; we expect going forward the increase in nonaccrual loans attributable to this effect will be much less significant; our loan modifications and other strategies to keep our customers in their homes will result in continued future growth in nonperforming assets until economic conditions improve; there will be continued high levels of nonaccruals until economic conditions improve; and we believe the allowance was adequate for losses inherent in the loan portfolio at June 30, 2009, including both performing and nonperforming loans.

Do not unduly rely on forward-looking statements as actual results could differ materially from expectations. Forward-looking statements speak only as of the date made, and we do not undertake to update them to reflect changes or events that occur after that date. Several factors could cause actual results to differ materially from expectations including: current economic and market conditions; our capital requirements and ability to raise capital on favorable terms; the terms of capital investments or other financial assistance provided by the U.S. government; legislative proposals to allow mortgage cram-downs in bankruptcy or force other loan modifications; our ability to successfully integrate the Wachovia merger and realize the expected cost savings and other benefits; our ability to realize efficiency initiatives to lower expenses when and in the amount expected; the adequacy of our allowance for credit losses; recognition of other-than-temporary impairment on securities held in our available-for-sale portfolio; the effect of changes in interest rates on our net interest margin and our mortgage originations, mortgage servicing rights and mortgages held for sale; hedging gains or losses; disruptions in the capital markets and reduced investor demand for mortgages loans; our ability to sell more products to our customers; the effect of the economic recession on the demand for our products and services; the effect of fluctuations in stock market prices on fee income from our brokerage, asset and wealth management businesses; our election to provide support to our mutual funds for structured credit products they may hold; changes in the value of our venture capital investments; changes in our accounting policies or in accounting standards or in how accounting standards are to be applied; mergers and acquisitions; federal and state regulations; reputational damage from negative publicity, fines, penalties and other negative consequences from regulatory violations, the loss of checking and saving account deposits to other investments such as the stock market, and fiscal and monetary policies of the Federal Reserve Board. There is no assurance that our allowance for credit losses will be adequate to cover future credit losses, especially if credit markets, housing prices, and unemployment do not stabilize or improve. Increases in loan charge-offs or in the allowance for credit losses and related provision expense could materially adversely affect our financial results and condition. There is no assurance that we will meet the SCAP capital requirement on the November 9, 2009 deadline established by the Federal Reserve Board. Although we exceeded the requirement at June 30, 2009, our common equity capital could fall between

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now and the deadline, causing us not to meet the requirement. Failure to meet the requirement could result in the issuance of equity securities or the conversion of preferred securities into common stock, resulting in substantial dilution to existing stockholders. For more information about factors that could cause actual results to differ materially from our expectations, refer to our reports filed with the Securities and Exchange Commission, including our Quarterly Report on Form 10-Q for the quarter ended March 31, 2009 and our Annual Report on Form 10-K for the year ended December 31, 2008, including the discussions under “Risk Factors” in each of those reports, as filed with the SEC and available on the SEC’s website at www.sec.gov. Any factor described above or in our SEC reports could, by itself or together with one or more other factors, adversely affect our financial results and condition.

About Wells Fargo

Wells Fargo & Company is a diversified financial services company with $1.3 trillion in assets, providing banking, insurance, investments, mortgage and consumer finance through more than 10,000 stores, over 12,000 ATMs and the internet (wellsfargo.com) across North America and internationally.

# # #

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Wells Fargo & Company and Subsidiaries
SUMMARY FINANCIAL DATA(1)(2)

	Quarter ended June 30,					Six months ended June 30,
($ in millions, except per share amounts)	2009			2008		2009		2008
For the Period
Wells Fargo net income	$	3,172			1,753		6,217		3,752
Wells Fargo net income applicable to common stock		2,575			1,753		4,959		3,752
Diluted earnings per common share		0.57			0.53		1.13		1.13
Profitability ratios (annualized):
Wells Fargo net income to average assets (ROA)		1.00	%		1.19		0.98		1.29
Net income to average assets		1.02			1.20		1.00		1.30
Wells Fargo net income applicable to common stock to average Wells Fargo common stockholders’ equity (ROE)		13.70			14.58		14.07		15.71
Net income to average total equity		11.56			14.62		11.76		15.77
Efficiency ratio (3)		56.4			51.0		56.3		51.2
Total revenue	$	22,507			11,460		43,524		22,023
Pre-tax pre-provision profit (PTPP) (4)		9,810			5,615		19,009		10,736
Dividends declared per common share		0.05			0.31		0.39		0.62
Average common shares outstanding		4,483.1			3,309.8		4,365.9		3,306.1
Diluted average common shares outstanding		4,501.6			3,321.4		4,375.1		3,319.6
Average loans	$	833,945			391,545		844,708		387,732
Average assets		1,274,926			594,749		1,282,280		584,871
Average core deposits (5)		765,697			318,377		759,845		317,827
Average retail core deposits (6)		596,648			230,365		593,592		229,315
Net interest margin		4.30	%		4.92		4.23		4.81
At Period End
Securities available for sale	$	206,795			91,331		206,795		91,331
Loans		821,614			399,237		821,614		399,237
Allowance for loan losses		23,035			7,375		23,035		7,375
Goodwill		24,619			13,191		24,619		13,191
Assets		1,284,176			609,074		1,284,176		609,074
Core deposits (5)		761,122			310,410		761,122		310,410
Wells Fargo stockholders’ equity		114,623			47,964		114,623		47,964
Total equity		121,382			48,265		121,382		48,265
Capital ratios:
Wells Fargo common stockholders’ equity to assets		6.51	%		7.87		6.51		7.87
Total equity to assets		9.45			7.92		9.45		7.92
Average Wells Fargo common stockholders’ equity to average assets		5.92			8.13		5.54		8.21
Average total equity to average assets		8.85			8.18		8.48		8.26
Risk-based capital (7)
Tier 1 capital		9.80			8.24		9.80		8.24
Total capital		13.84			11.23		13.84		11.23
Tier 1 leverage (7)		8.32			7.35		8.32		7.35
Book value per common share		17.91			14.48		17.91		14.48
Team members (active, full-time equivalent)		269,900			160,500		269,900		160,500
Common stock price:
High	$	28.45			32.40		30.47		34.56
Low		13.65			23.46		7.80		23.46
Period end		24.26			23.75		24.26		23.75

(1)	Wells Fargo & Company (Wells Fargo) acquired Wachovia Corporation (Wachovia) on December 31, 2008. Because the acquisition was completed on December 31, 2008, Wachovia’s results are included in the income statement, average balances and related metrics beginning in 2009. Wachovia’s assets and liabilities are included in the consolidated balance sheet beginning on December 31, 2008.
(2)	On January 1, 2009, we adopted Statement of Financial Accounting Standards (FAS) No. 160,Noncontrolling Interests in Consolidated Financial Statements — an amendment of ARB No. 51, on a retrospective basis for disclosure and, accordingly, prior period information reflects the adoption. FAS 160 requires that noncontrolling interests be reported as a component of total equity.
(3)	The efficiency ratio is noninterest expense divided by total revenue (net interest income and noninterest income).
(4)	Pre-tax pre-provision profit (PTPP) is total revenue less noninterest expense. Management believes that PTPP is a useful financial measure because it enables investors and others to assess the Company’s ability to generate capital to cover credit losses through a credit cycle. Federal banking regulators used a similar measure, pre-provision net revenue, in connection with the Supervisory Capital Assessment Program (SCAP) “stress test” to assess the capital adequacy of certain financial institutions. Under the SCAP guidelines, pre-provision net revenue is PTPP adjusted for certain items.
(5)	Core deposits are noninterest-bearing deposits, interest-bearing checking, savings certificates, market rate and other savings, and certain foreign deposits (Eurodollar sweep balances).
(6)	Retail core deposits are total core deposits excluding Wholesale Banking core deposits and retail mortgage escrow deposits.
(7)	The June 30, 2009, ratios are preliminary.

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Wells Fargo & Company and Subsidiaries
FIVE QUARTER SUMMARY FINANCIAL DATA (1) (2)

	Quarter ended
	June 30,			Mar. 31,			Dec. 31,			Sept. 30,		June 30,
($ in millions, except per share amounts)	2009			2009			2008			2008		2008
For the Quarter
Wells Fargo net income (loss)	$	3,172			3,045			(2,734	)		1,637		1,753
Wells Fargo net income (loss) applicable to common stock		2,575			2,384			(3,020	)		1,637		1,753
Diluted earnings (loss) per common share		0.57			0.56			(0.84	)		0.49		0.53
Profitability ratios (annualized):
Wells Fargo net income (loss) to average assets (ROA)		1.00	%		0.96			(1.72	)		1.06		1.19
Net income (loss) to average assets		1.02			0.97			(1.72	)		1.07		1.20
Wells Fargo net income (loss) applicable to common stock to average Wells Fargo common stockholders’ equity (ROE)		13.70			14.49			(22.32	)		13.63		14.58
Net income (loss) to average total equity		11.56			11.97			(15.53	)		13.66		14.62
Efficiency ratio (3)		56.4			56.2			61.3			53.0		51.0
Total revenue	$	22,507			21,017			9,477			10,377		11,460
Pre-tax pre-provision profit (PTPP) (4)		9,810			9,199			3,667			4,876		5,615
Dividends declared per common share		0.05			0.34			0.34			0.34		0.31
Average common shares outstanding		4,483.1			4,247.4			3,582.4			3,316.4		3,309.8
Diluted average common shares outstanding		4,501.6			4,249.3			3,593.6			3,331.0		3,321.4
Average loans	$	833,945			855,591			413,940			404,203		391,545
Average assets		1,274,926			1,289,716			633,223			614,194		594,749
Average core deposits (5)		765,697			753,928	��		344,957			320,074		318,377
Average retail core deposits (6)		596,648			590,502			243,464			234,140		230,365
Net interest margin		4.30	%		4.16			4.90			4.79		4.92
At Quarter End
Securities available for sale	$	206,795			178,468			151,569			86,882		91,331
Loans		821,614			843,579			864,830			411,049		399,237
Allowance for loan losses		23,035			22,281			21,013			7,865		7,375
Goodwill		24,619			23,825			22,627			13,520		13,191
Assets		1,284,176			1,285,891			1,309,639			622,361		609,074
Core deposits (5)		761,122			756,183			745,432			334,076		310,410
Wells Fargo stockholders’ equity		114,623			100,295			99,084			46,957		47,964
Total equity		121,382			107,057			102,316			47,259		48,265
Capital ratios:
Wells Fargo common stockholders’ equity to assets		6.51	%		5.40			5.21			7.54		7.87
Total equity to assets		9.45			8.33			7.81			7.59		7.92
Average Wells Fargo common stockholders’ equity to average assets		5.92			5.17			8.50			7.78		8.13
Average total equity to average assets		8.85			8.11			11.09			7.83		8.18
Risk-based capital (7)
Tier 1 capital		9.80			8.30			7.84			8.59		8.24
Total capital		13.84			12.30			11.83			11.51		11.23
Tier 1 leverage (7)		8.32			7.09			14.52			7.54		7.35
Book value per common share		17.91			16.28			16.15			14.14		14.48
Team members (active, full-time equivalent)		269,900			272,800			270,800			159,000		160,500
Common stock price:
High	$	28.45			30.47			38.95			44.68		32.40
Low		13.65			7.80			19.89			20.46		23.46
Period end		24.26			14.24			29.48			37.53		23.75

(1)	Wells Fargo & Company (Wells Fargo) acquired Wachovia Corporation (Wachovia) on December 31, 2008. Because the acquisition was completed on December 31, 2008, Wachovia’s results are included in the income statement, average balances and related metrics beginning in 2009. Wachovia’s assets and liabilities are included in the consolidated balance sheet beginning on December 31, 2008.
(2)	On January 1, 2009, we adopted Statement of Financial Accounting Standards (FAS) No. 160,Noncontrolling Interests in Consolidated Financial Statements — an amendment of ARB No. 51, on a retrospective basis for disclosure and, accordingly, prior period information reflects the adoption. FAS 160 requires that noncontrolling interests be reported as a component of total equity.
(3)	The efficiency ratio is noninterest expense divided by total revenue (net interest income and noninterest income).
(4)	Pre-tax pre-provision profit (PTPP) is total revenue less noninterest expense. Management believes that PTPP is a useful financial measure because it enables investors and others to assess the Company’s ability to generate capital to cover credit losses through a credit cycle. Federal banking regulators used a similar measure, pre-provision net revenue, in connection with the Supervisory Capital Assessment Program (SCAP) “stress test” to assess the capital adequacy of certain financial institutions. Under the SCAP guidelines, pre-provision net revenue is PTPP adjusted for certain items.
(5)	Core deposits are noninterest-bearing deposits, interest-bearing checking, savings certificates, market rate and other savings, and certain foreign deposits (Eurodollar sweep balances).
(6)	Retail core deposits are total core deposits excluding Wholesale Banking core deposits and retail mortgage escrow deposits.
(7)	The June 30, 2009, ratios are preliminary. Because the Wachovia acquisition was completed on December 31, 2008, the Tier 1 leverage ratio at December 31, 2008, which considers period-end Tier 1 capital and quarterly average assets in the computation of the ratio, does not reflect average assets of Wachovia for 2008.

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Wells Fargo & Company and Subsidiaries
CONSOLIDATED STATEMENT OF INCOME

	Quarter ended June 30,						Six months ended June 30,
(in millions, except per share amounts)	2009			2008			2009			2008
Interest income
Trading assets	$	206			38			472			85
Securities available for sale		2,887			1,224			5,596			2,356
Mortgages held for sale		545			423			960			817
Loans held for sale		50			10			117			22
Loans		10,532			6,806			21,297			14,018
Other interest income		81			46			172			98
Total interest income		14,301			8,547			28,614			17,396
Interest expense
Deposits		957			1,063			1,956			2,657
Short-term borrowings		55			357			178			782
Long-term debt		1,485			849			3,264			1,919
Other interest expense		40			—			76			—
Total interest expense		2,537			2,269			5,474			5,358
Net interest income		11,764			6,278			23,140			12,038
Provision for credit losses		5,086			3,012			9,644			5,040
Net interest income after provision for credit losses		6,678			3,266			13,496			6,998
Noninterest income
Service charges on deposit accounts		1,448			800			2,842			1,548
Trust and investment fees		2,413			762			4,628			1,525
Card fees		923			588			1,776			1,146
Other fees		963			511			1,864			1,010
Mortgage banking		3,046			1,197			5,550			1,828
Insurance		595			550			1,176			1,054
Net gains (losses) on debt securities available for sale (includes impairment losses of $308 and $577, consisting of $972 and $1,575 of total other-than-temporary impairment losses, net of $664 and $998 recognized in other comprehensive income, for the quarter and six months ended June 30, 2009, respectively)		(78	)		(91	)		(197	)		232
Net gains (losses) from equity investments		40			47			(117	)		360
Other		1,393			818			2,862			1,282
Total noninterest income		10,743			5,182			20,384			9,985
Noninterest expense
Salaries		3,438			2,030			6,824			4,014
Commission and incentive compensation		2,060			806			3,884			1,450
Employee benefits		1,227			593			2,511			1,180
Equipment		575			305			1,262			653
Net occupancy		783			400			1,579			799
Core deposit and other intangibles		646			46			1,293			92
FDIC and other deposit assessments		981			18			1,319			26
Other		2,987			1,647			5,843			3,073
Total noninterest expense		12,697			5,845			24,515			11,287
Income before income tax expense		4,724			2,603			9,365			5,696
Income tax expense		1,475			834			3,027			1,908
Net income before noncontrolling interests		3,249			1,769			6,338			3,788
Less: Net income from noncontrolling interests		77			16			121			36
Wells Fargo net income	$	3,172			1,753			6,217			3,752
Wells Fargo net income applicable to common stock	$	2,575			1,753			4,959			3,752
Per share information
Earnings per common share	$	0.58			0.53			1.14			1.13
Diluted earnings per common share		0.57			0.53			1.13			1.13
Dividends declared per common share		0.05			0.31			0.39			0.62
Average common shares outstanding		4,483.1			3,309.8			4,365.9			3,306.1
Diluted average common shares outstanding		4,501.6			3,321.4			4,375.1			3,319.6

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Wells Fargo & Company and Subsidiaries
FIVE QUARTER CONSOLIDATED STATEMENT OF INCOME

	Quarter ended
	June 30,			Mar. 31,			Dec. 31,			Sept. 30,			June 30,
(in millions, except per share amounts)	2009			2009			2008			2008			2008
Interest income
Trading assets	$	206			266			51			41			38
Securities available for sale		2,887			2,709			1,534			1,397			1,224
Mortgages held for sale		545			415			362			394			423
Loans held for sale		50			67			14			12			10
Loans		10,532			10,765			6,726			6,888			6,806
Other interest income		81			91			41			42			46
Total interest income		14,301			14,313			8,728			8,774			8,547
Interest expense
Deposits		957			999			845			1,019			1,063
Short-term borrowings		55			123			204			492			357
Long-term debt		1,485			1,779			955			882			849
Other interest expense		40			36			—			—			—
Total interest expense		2,537			2,937			2,004			2,393			2,269
Net interest income		11,764			11,376			6,724			6,381			6,278
Provision for credit losses		5,086			4,558			8,444			2,495			3,012
Net interest income after provision for credit losses		6,678			6,818			(1,720	)		3,886			3,266
Noninterest income
Service charges on deposit accounts		1,448			1,394			803			839			800
Trust and investment fees		2,413			2,215			661			738			762
Card fees		923			853			589			601			588
Other fees		963			901			535			552			511
Mortgage banking		3,046			2,504			(195	)		892			1,197
Insurance		595			581			337			439			550
Net gains (losses) on debt securities available for sale		(78	)		(119	)		721			84			(91	)
Net gains (losses) from equity investments		40			(157	)		(608	)		(509	)		47
Other		1,393			1,469			(90	)		360			818
Total noninterest income		10,743			9,641			2,753			3,996			5,182
Noninterest expense
Salaries		3,438			3,386			2,168			2,078			2,030
Commission and incentive compensation		2,060			1,824			671			555			806
Employee benefits		1,227			1,284			338			486			593
Equipment		575			687			402			302			305
Net occupancy		783			796			418			402			400
Core deposit and other intangibles		646			647			47			47			46
FDIC and other deposit assessments		981			338			57			37			18
Other		2,987			2,856			1,709			1,594			1,647
Total noninterest expense		12,697			11,818			5,810			5,501			5,845
Income (loss) before income tax expense (benefit)		4,724			4,641			(4,777	)		2,381			2,603
Income tax expense (benefit)		1,475			1,552			(2,036	)		730			834
Net income (loss) before noncontrolling interests		3,249			3,089			(2,741	)		1,651			1,769
Less: Net income (loss) from noncontrolling interests		77			44			(7	)		14			16
Wells Fargo net income (loss)	$	3,172			3,045			(2,734	)		1,637			1,753
Wells Fargo net income (loss) applicable to common stock	$	2,575			2,384			(3,020	)		1,637			1,753
Per share information
Earnings (loss) per common share	$	0.58			0.56			(0.84	)		0.49			0.53
Diluted earnings (loss) per common share		0.57			0.56			(0.84	)		0.49			0.53
Dividends declared per common share		0.05			0.34			0.34			0.34			0.31
Average common shares outstanding		4,483.1			4,247.4			3,582.4			3,316.4			3,309.8
Diluted average common shares outstanding		4,501.6			4,249.3			3,593.6			3,331.0			3,321.4

-22-

Wells Fargo & Company and Subsidiaries
CONSOLIDATED BALANCE SHEET

	June 30,			Dec. 31,
(in millions, except shares)	2009			2008
Assets
Cash and due from banks	$	20,632			23,763
Federal funds sold, securities purchased under resale agreements and other short-term investments		15,976			49,433
Trading assets		40,110			54,884
Securities available for sale		206,795			151,569
Mortgages held for sale (includes $40,190 and $18,754 carried at fair value)		41,991			20,088
Loans held for sale (includes $141 and $398 carried at fair value)		5,413			6,228
Loans		821,614			864,830
Allowance for loan losses		(23,035	)		(21,013	)
Net loans		798,579			843,817
Mortgage servicing rights:
Measured at fair value (residential MSRs)		15,690			14,714
Amortized		1,205			1,446
Premises and equipment, net		11,151			11,269
Goodwill		24,619			22,627
Other assets		102,015			109,801
Total assets	$	1,284,176			1,309,639
Liabilities
Noninterest-bearing deposits	$	173,149			150,837
Interest-bearing deposits		640,586			630,565
Total deposits		813,735			781,402
Short-term borrowings		55,483			108,074
Accrued expenses and other liabilities		64,160			50,689
Long-term debt		229,416			267,158
Total liabilities		1,162,794			1,207,323
Equity
Wells Fargo stockholders’ equity:
Preferred stock		31,497			31,332
Common stock — $1-2/3 par value, authorized 6,000,000,000 shares; issued 4,756,071,429 shares and 4,363,921,429 shares		7,927			7,273
Additional paid-in capital		40,270			36,026
Retained earnings		39,165			36,543
Cumulative other comprehensive loss		(590	)		(6,869	)
Treasury stock - 87,923,034 shares and 135,290,540 shares		(3,126	)		(4,666	)
Unearned ESOP shares		(520	)		(555	)
Total Wells Fargo stockholders’ equity		114,623			99,084
Noncontrolling interests		6,759			3,232
Total equity		121,382			102,316
Total liabilities and equity	$	1,284,176			1,309,639

-23-

Wells Fargo & Company and Subsidiaries
FIVE QUARTER CONSOLIDATED BALANCE SHEET

	June 30,			Mar. 31,			Dec. 31,			Sept. 30,			June 30,
(in millions)	2009			2009			2008			2008			2008
Assets
Cash and due from banks	$	20,632			22,186			23,763			12,861			13,610
Federal funds sold, securities purchased under resale agreements and other short-term investments		15,976			18,625			49,433			8,093			4,088
Trading assets		40,110			46,497			54,884			9,097			9,681
Securities available for sale		206,795			178,468			151,569			86,882			91,331
Mortgages held for sale		41,991			36,807			20,088			18,739			25,234
Loans held for sale		5,413			8,306			6,228			635			680
Loans		821,614			843,579			864,830			411,049			399,237
Allowance for loan losses		(23,035	)		(22,281	)		(21,013	)		(7,865	)		(7,375	)
Net loans		798,579			821,298			843,817			403,184			391,862
Mortgage servicing rights:
Measured at fair value (residential MSRs)		15,690			12,391			14,714			19,184			19,333
Amortized		1,205			1,257			1,446			433			442
Premises and equipment, net		11,151			11,215			11,269			5,054			5,033
Goodwill		24,619			23,825			22,627			13,520			13,191
Other assets		102,015			105,016			109,801			44,679			34,589
Total assets	$	1,284,176			1,285,891			1,309,639			622,361			609,074
Liabilities
Noninterest-bearing deposits	$	173,149			166,497			150,837			89,446			85,062
Interest-bearing deposits		640,586			630,772			630,565			264,128			254,062
Total deposits		813,735			797,269			781,402			353,574			339,124
Short-term borrowings		55,483			72,084			108,074			85,187			86,139
Accrued expenses and other liabilities		64,160			58,831			50,689			28,991			31,618
Long-term debt		229,416			250,650			267,158			107,350			103,928
Total liabilities		1,162,794			1,178,834			1,207,323			575,102			560,809
Equity
Wells Fargo stockholders’ equity:
Preferred stock		31,497			31,411			31,332			625			723
Common stock		7,927			7,273			7,273			5,788			5,788
Additional paid-in capital		40,270			32,414			36,026			8,348			8,266
Retained earnings		39,165			36,949			36,543			40,853			40,534
Cumulative other comprehensive loss		(590	)		(3,624	)		(6,869	)		(2,783	)		(1,060	)
Treasury stock		(3,126	)		(3,593	)		(4,666	)		(5,207	)		(5,516	)
Unearned ESOP shares		(520	)		(535	)		(555	)		(667	)		(771	)
Total Wells Fargo stockholders’ equity		114,623			100,295			99,084			46,957			47,964
Noncontrolling interests		6,759			6,762			3,232			302			301
Total equity		121,382			107,057			102,316			47,259			48,265
Total liabilities and equity	$	1,284,176			1,285,891			1,309,639			622,361			609,074

-24-

Wells Fargo & Company and Subsidiaries
FIVE QUARTER AVERAGE BALANCES

	Quarter ended
	June 30,			Mar. 31,			Dec. 31,			Sept. 30,			June 30,
(in millions)	2009			2009			2008			2008			2008
Earning assets
Federal funds sold, securities purchased under resale agreements and other short-term investments	$	20,889			24,074			9,938			3,463			3,853
Trading assets		18,464			22,203			5,004			4,838			4,915
Debt securities available for sale:
Securities of U.S. Treasury and federal agencies		2,102			2,899			1,165			1,141			1,050
Securities of U.S. states and political subdivisions		12,189			12,213			7,124			7,211			7,038
Mortgage-backed securities:
Federal agencies		92,550			76,545			51,714			50,528			40,630
Residential and commercial		41,257			38,690			18,245			21,358			22,419
Total mortgage-backed securities		133,807			115,235			69,959			71,886			63,049
Other debt securities (1)		30,901			30,080			14,217			12,622			13,600
Total debt securities available for sale (1)		178,999			160,427			92,465			92,860			84,737
Mortgages held for sale (2)		43,177			31,058			23,390			24,990			28,004
Loans held for sale (2)		7,188			7,949			1,287			677			734
Loans:
Commercial and commercial real estate:
Commercial		187,501			196,923			107,325			100,688			95,263
Other real estate mortgage		104,297			104,271			45,555			43,616			39,977
Real estate construction		33,857			34,493			19,943			19,715			19,213
Lease financing		14,750			15,810			7,397			7,250			7,087
Total commercial and commercial real estate		340,405			351,497			180,220			171,269			161,540
Consumer:
Real estate 1-4 family first mortgage		240,798			245,494			78,251			76,197			73,663
Real estate 1-4 family junior lien mortgage		108,422			110,128			75,838			75,379			75,018
Credit card		22,963			23,295			20,626			19,948			19,037
Other revolving credit and installment		90,729			92,820			52,638			54,104			54,842
Total consumer		462,912			471,737			227,353			225,628			222,560
Foreign		30,628			32,357			6,367			7,306			7,445
Total loans (2)		833,945			855,591			413,940			404,203			391,545
Other		6,079			6,140			1,690			2,126			2,033
Total earning assets	$	1,108,741			1,107,442			547,714			533,157			515,821
Funding sources
Deposits:
Interest-bearing checking	$	79,955			80,393			6,396			5,483			5,487
Market rate and other savings		334,067			313,445			178,301			166,710			161,760
Savings certificates		152,444			170,122			41,189			37,192			37,634
Other time deposits		21,660			25,555			8,128			7,930			5,773
Deposits in foreign offices		49,885			45,896			42,771			49,054			51,884
Total interest-bearing deposits		638,011			635,411			276,785			266,369			262,538
Short-term borrowings		59,844			76,068			60,210			83,458			66,537
Long-term debt		235,590			258,957			104,112			103,745			100,552
Other liabilities		4,604			3,778			—			—			—
Total interest-bearing liabilities		938,049			974,214			441,107			453,572			429,627
Portion of noninterest-bearing funding sources		170,692			133,228			106,607			79,585			86,194
Total funding sources	$	1,108,741			1,107,442			547,714			533,157			515,821
Noninterest-earning assets
Cash and due from banks	$	19,340			20,255			11,155			11,024			10,875
Goodwill		24,261			23,183			13,544			13,531			13,171
Other		122,584			138,836			60,810			56,482			54,882
Total noninterest-earning assets	$	166,185			182,274			85,509			81,037			78,928
Noninterest-bearing funding sources
Deposits	$	174,529			160,308			91,229			87,095			88,041
Other liabilities		49,570			50,566			30,651			25,452			28,434
Total equity		112,778			104,628			70,236			48,075			48,647
Noninterest-bearing funding sources used to fund earning assets		(170,692	)		(133,228	)		(106,607	)		(79,585	)		(86,194	)
Net noninterest-bearing funding sources	$	166,185			182,274			85,509			81,037			78,928
Total assets	$	1,274,926			1,289,716			633,223			614,194			594,749

(1)	Includes certain preferred securities.
(2)	Nonaccrual loans are included in their respective loan categories.

-25-

Wells Fargo & Company and Subsidiaries
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN TOTAL EQUITY(1)

	Six months ended June 30,
(in millions)	2009			2008
Balance, beginning of period(2)	$	102,316			47,914
Cumulative effect from adoption of:
EITF 06-4 and 06-10 (3)		—			(20	)
FAS 158 change of measurement date (4)		—			(8	)
Net income before noncontrolling interests		6,338			3,788
Wells Fargo other comprehensive income (loss), net of tax, related to:
Translation adjustments		35			(6	)
Investment securities (5):
Unrealized losses related to factors other than credit (2)		(628	)		—
All other		6,667			(1,732	)
Derivative instruments and hedging activities		(300	)		(49	)
Defined benefit pension plans		558			2
Common stock issued		9,308			608
Common stock repurchased		(63	)		(520	)
Preferred stock released to ESOP		33			248
Common stock dividends		(1,657	)		(2,050	)
Preferred stock dividends		(1,060	)		—
Other, net		(165	)		90
Balance, end of period	$	121,382			48,265

(1)	On January 1, 2009, the Company adopted FAS 160,Noncontrolling Interests in Consolidated Financial Statements — an amendment of ARB No. 51, on a retrospective basis for disclosure and, accordingly, prior period information reflects the adoption. FAS 160 requires that noncontrolling interests be reported as a component of stockholders’ equity.
(2)	The impact on prior periods of adopting FASB Staff Position (FSP) FAS 115-2 and FAS 124-2,Recognition and Presentation of Other-Than-Temporary Impairments, was to increase the beginning balance of retained earnings and reduce the beginning balance of other comprehensive income by $85 million ($53 million after tax). The unrealized losses in Wells Fargo other comprehensive income in the first half of 2009 that related to factors other than credit, where the credit portion was recorded as other-than-temporary impairment in earnings, amounted to $998 million ($628 million after tax).
(3)	Emerging Issues Task Force (EITF) Issue No. 06-4,Accounting for Deferred Compensation and Postretirement Benefit Aspects of Endorsement Split-Dollar Life Insurance Arrangements, and Issue No. 06-10,Accounting for Deferred Compensation and Postretirement Benefit Aspects of Collateral Assignment Split-Dollar Life Insurance Arrangements.
(4)	FAS 158,Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans — an amendment of FASB Statements No. 87, 88, 106, and 132(R).
(5)	On March 31, 2009, we early adopted FSP FAS 157-4,Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly. This FSP addresses determining fair values for securities in circumstances where the market for such securities is illiquid and transactions involve distressed sales. In such circumstances, the FSP permits use of other inputs in estimating fair value that may include pricing models. As a result of adopting FSP FAS 157-4, we recorded in first quarter 2009 a $4.4 billion reduction ($2.8 billion after tax) to our unrealized securities losses in other comprehensive income.

-26-

Wells Fargo & Company and Subsidiaries
TANGIBLE AND TIER 1 COMMON EQUITY(1)

		Quarter ended
					June 30,					Mar. 31,
(in billions)					2009					2009
Total equity					$	121.4					107.1
Less: Preferred equity						(31.0	)				(30.9	)
Goodwill and intangible assets (other than MSRs)		$	(38.7	)				(38.5	)
Applicable deferred taxes			5.5					5.7
Goodwill and intangible assets, net of deferred taxes						(33.2	)				(32.8	)
Noncontrolling interests						(2.3	)				(2.3	)
Tangible common equity (1)	(A)				$	54.9					41.1
Additional Tier 1 regulatory adjustments:
Noncontrolling interests with equity characteristics					$	(4.5	)				(4.5	)
Deferred tax asset limitation						(2.0	)				(4.7	)
MSRs over specified limitations						(1.6	)				(1.3	)
Cumulative other comprehensive income						0.6					3.6
Other						(0.3	)				(0.8	)
Tier 1 common equity	(B)				$	47.1					33.4
Total risk-weighted assets (2)	(C)				$	1,048.4					1,071.5
Tangible common equity to total risk-weighted assets	(A)/(C)					5.24	%				3.84
Tier 1 common equity to total risk-weighted assets	(B)/(C)					4.49					3.12

(1)

Tangible and Tier 1 common equity are non-GAAP financial measures that are used by investors, analysts and bank regulatory agencies, including the Federal Reserve in the Supervisory Capital Assessment Program, to assess the capital position of financial services companies. Tangible common equity includes total equity, less preferred equity, goodwill and intangible assets (excluding MSRs), net of related deferred taxes, and the portion of noncontrolling interests accounted for under FAS 160 that does not have risk sharing attributes similar to common equity. The methodology of determining tangible common equity may differ among companies. Tier 1 common equity includes tangible common equity, adjusted for specified Tier 1 regulatory capital limitations covering deferred tax, MSRs, noncontrolling interests with common equity characteristics and cumulative other comprehensive income. Management reviews tangible and Tier 1 common equity along with other measures of capital as part of its financial analyses and has included this non-GAAP financial information, and the corresponding reconciliation to total equity, because of current interest in such information on the part of market participants.

(2)

Under the regulatory guidelines for risk-based capital, on-balance sheet assets and credit equivalent amounts of derivatives and off-balance sheet items are assigned to one of several broad risk categories according to the obligor or, if relevant, the guarantor or the nature of any collateral. The aggregate dollar amount in each risk category is then multiplied by the risk weight associated with that category. The resulting weighted values from each of the risk categories are aggregated for determining total risk-weighted assets. The Company’s June 30, 2009, preliminary risk-weighted assets reflect estimated on-balance sheet risk-weighted assets of $875.2 billion and derivative and off-balance sheet risk-weighted assets of $173.2 billion.

-27-

Wells Fargo & Company and Subsidiaries
FIVE QUARTER LOANS

	June 30,		Mar. 31,		Dec. 31,		Sept. 30,		June 30,
(in millions)	2009		2009		2008		2008		2008
Commercial and commercial real estate:
Commercial	$	182,037		191,711		202,469		104,281		99,188
Other real estate mortgage		103,654		104,934		103,108		44,741		41,753
Real estate construction		33,238		33,912		34,676		19,681		19,528
Lease financing		14,555		14,792		15,829		7,271		7,160
Total commercial and commercial real estate		333,484		345,349		356,082		175,974		167,629
Consumer:
Real estate 1-4 family first mortgage		237,289		242,947		247,894		77,870		74,829
Real estate 1-4 family junior lien mortgage		107,024		109,748		110,164		75,617		75,261
Credit card		23,069		22,815		23,555		20,358		19,429
Other revolving credit and installment		90,654		91,252		93,253		54,327		54,575
Total consumer		458,036		466,762		474,866		228,172		224,094
Foreign		30,094		31,468		33,882		6,903		7,514
Total loans (net of unearned income) (1)	$	821,614		843,579		864,830		411,049		399,237

(1) Includes $55.2 billion, $58.2 billion and $58.8 billion of SOP 03-3 loans at June 30, 2009, March 31, 2009, and December 31, 2008, respectively. See table on page 39 for detail of SOP 03-3 loans.

FIVE QUARTER NONACCRUAL LOANS AND OTHER NONPERFORMING ASSETS

	June 30,			Mar. 31,		Dec. 31,		Sept. 30,		June 30,
(in millions)	2009(1)			2009(1)		2008(1)		2008		2008
Nonaccrual loans:
Commercial and commercial real estate:
Commercial	$	2,910			1,696		1,253		846		685
Other real estate mortgage		2,343			1,324		594		296		198
Real estate construction		2,210			1,371		989		736		563
Lease financing		130			114		92		69		59
Total commercial and commercial real estate		7,593			4,505		2,928		1,947		1,505
Consumer:
Real estate 1-4 family first mortgage (2)		6,000			4,218		2,648		1,975		1,638
Real estate 1-4 family junior lien mortgage (2)		1,652			1,418		894		780		668
Other revolving credit and installment		327			300		273		232		207
Total consumer		7,979			5,936		3,815		2,987		2,513
Foreign		226			75		57		61		55
Total nonaccrual loans		15,798			10,516		6,800		4,995		4,073
As a percentage of total loans		1.92	%		1.25		0.79		1.22		1.02
Foreclosed assets:
GNMA loans (3)	$	932			768		667		596		535
All other		1,592			1,294		1,526		644		595
Real estate and other nonaccrual investments (4)		20			34		16		56		24
Total nonaccrual loans and other nonperforming assets	$	18,342			12,612		9,009		6,291		5,227
As a percentage of total loans		2.23	%		1.50		1.04		1.53		1.31

(1)	Excludes loans acquired from Wachovia that are accounted for under SOP 03-3.
(2)	Includes nonaccrual mortgages held for sale.
(3)	Consistent with regulatory reporting requirements, foreclosed real estate securing Government National Mortgage Association (GNMA) loans is classified as nonperforming. Both principal and interest for GNMA loans secured by the foreclosed real estate are collectible because the GNMA loans are insured by the Federal Housing Administration or guaranteed by the Department of Veterans Affairs.
(4)	Includes real estate investments (contingent interest loans accounted for as investments) that would be classified as nonaccrual if these assets were recorded as loans.

-28-

Wells Fargo & Company and Subsidiaries
CHANGES IN THE ALLOWANCE FOR CREDIT LOSSES

	Quarter ended June 30,						Six months ended June 30,
(in millions)	2009			2008			2009			2008
Balance, beginning of period	$	22,846			6,013			21,711			5,518
Provision for credit losses		5,086			3,012			9,644			5,040
Loan charge-offs:
Commercial and commercial real estate:
Commercial		(755	)		(333	)		(1,351	)		(592	)
Other real estate mortgage		(152	)		(6	)		(183	)		(10	)
Real estate construction		(236	)		(28	)		(341	)		(57	)
Lease financing		(65	)		(13	)		(85	)		(25	)
Total commercial and commercial real estate		(1,208	)		(380	)		(1,960	)		(684	)
Consumer:
Real estate 1-4 family first mortgage		(790	)		(103	)		(1,214	)		(184	)
Real estate 1-4 family junior lien mortgage		(1,215	)		(352	)		(2,088	)		(807	)
Credit card		(712	)		(369	)		(1,334	)		(682	)
Other revolving credit and installment		(802	)		(488	)		(1,702	)		(1,031	)
Total consumer		(3,519	)		(1,312	)		(6,338	)		(2,704	)
Foreign		(56	)		(58	)		(110	)		(126	)
Total loan charge-offs		(4,783	)		(1,750	)		(8,408	)		(3,514	)
Loan recoveries:
Commercial and commercial real estate:
Commercial		51			32			91			63
Other real estate mortgage		6			2			16			3
Real estate construction		4			1			6			2
Lease financing		4			3			7			6
Total commercial and commercial real estate		65			38			120			74
Consumer:
Real estate 1-4 family first mortgage		32			7			65			13
Real estate 1-4 family junior lien mortgage		44			18			70			35
Credit card		48			40			88			78
Other revolving credit and installment		198			121			402			246
Total consumer		322			186			625			372
Foreign		10			14			19			28
Total loan recoveries		397			238			764			474
Net loan charge-offs (1)		(4,386	)		(1,512	)		(7,644	)		(3,040	)
Allowances related to business combinations/other		(16	)		4			(181	)		(1	)
Balance, end of period	$	23,530			7,517			23,530			7,517
Components:
Allowance for loan losses	$	23,035			7,375			23,035			7,375
Reserve for unfunded credit commitments		495			142			495			142
Allowance for credit losses	$	23,530			7,517			23,530			7,517
Net loan charge-offs (annualized) as a percentage of average total loans (2)		2.11	%		1.55			1.82			1.58

(1)

Because the Wachovia acquisition was completed on December 31, 2008, charge-offs and recoveries for 2008 include only those of Wells Fargo, and exclude those of Wachovia for that period. For Wachovia loans accounted for under SOP 03-3, loan losses on SOP 03-3 loans in the first half of 2009 are reported as a reduction of the nonaccretable difference rather than as charge-offs. This affects the comparability of certain ratios as described on page 39.

(2)

The allowance for loan losses and the allowance for credit losses include $49 million for the quarter ended June 30, 2009, and none for prior periods related to loans acquired from Wachovia that are accounted for under SOP 03-3. Loans acquired from Wachovia are included in total loans net of related purchase accounting write-downs. These factors affect the comparability of these ratios for the periods ended June 30, 2009, to the comparable periods in 2008 as described on page 39.

-29-

Wells Fargo & Company and Subsidiaries
FIVE QUARTER CHANGES IN THE ALLOWANCE FOR CREDIT LOSSES

	Quarter ended
	June 30,			Mar. 31,			Dec. 31,			Sept. 30,			June 30,
(in millions)	2009			2009			2008			2008			2008
Balance, beginning of quarter	$	22,846			21,711			8,027			7,517			6,013
Provision for credit losses (1)		5,086			4,558			8,444			2,495			3,012
Loan charge-offs:
Commercial and commercial real estate:
Commercial		(755	)		(596	)		(756	)		(305	)		(333	)
Other real estate mortgage		(152	)		(31	)		(10	)		(9	)		(6	)
Real estate construction		(236	)		(105	)		(85	)		(36	)		(28	)
Lease financing		(65	)		(20	)		(21	)		(19	)		(13	)
Total commercial and commercial real estate		(1,208	)		(752	)		(872	)		(369	)		(380	)
Consumer:
Real estate 1-4 family first mortgage		(790	)		(424	)		(210	)		(146	)		(103	)
Real estate 1-4 family junior lien mortgage		(1,215	)		(873	)		(728	)		(669	)		(352	)
Credit card		(712	)		(622	)		(485	)		(396	)		(369	)
Other revolving credit and installment		(802	)		(900	)		(683	)		(586	)		(488	)
Total consumer		(3,519	)		(2,819	)		(2,106	)		(1,797	)		(1,312	)
Foreign		(56	)		(54	)		(60	)		(59	)		(58	)
Total loan charge-offs		(4,783	)		(3,625	)		(3,038	)		(2,225	)		(1,750	)
Loan recoveries:
Commercial and commercial real estate:
Commercial		51			40			24			27			32
Other real estate mortgage		6			10			1			1			2
Real estate construction		4			2			1			—			1
Lease financing		4			3			4			3			3
Total commercial and commercial real estate		65			55			30			31			38
Consumer:
Real estate 1-4 family first mortgage		32			33			17			7			7
Real estate 1-4 family junior lien mortgage		44			26			26			28			18
Credit card		48			40			34			35			40
Other revolving credit and installment		198			204			118			117			121
Total consumer		322			303			195			187			186
Foreign		10			9			9			12			14
Total loan recoveries		397			367			234			230			238
Net loan charge-offs (2)		(4,386	)		(3,258	)		(2,804	)		(1,995	)		(1,512	)
Allowances related to business combinations/other		(16	)		(165	)		8,044			10			4
Balance, end of quarter	$	23,530			22,846			21,711			8,027			7,517
Components:
Allowance for loan losses	$	23,035			22,281			21,013			7,865			7,375
Reserve for unfunded credit commitments		495			565			698			162			142
Allowance for credit losses	$	23,530			22,846			21,711			8,027			7,517
Net loan charge-offs (annualized) as a percentage of average total loans (2)		2.11	%		1.54			2.69			1.96			1.55
Allowance for loan losses as a percentage of (3):
Total loans		2.80	%		2.64			2.43			1.91			1.85
Nonaccrual loans		146			212			309			157			181
Nonaccrual loans and other nonperforming assets		126			177			233			125			141
Allowance for credit losses as a percentage of (3):
Total loans		2.86	%		2.71			2.51			1.95			1.88
Nonaccrual loans		149			217			319			161			185
Nonaccrual loans and other nonperforming assets		128			181			241			128			144

(1)	Provision for credit losses for the quarter ended December 31, 2008, included $3.9 billion to conform reserve practices of Wells Fargo and Wachovia.
(2)	Because the Wachovia acquisition was completed on December 31, 2008, charge-offs and recoveries for 2008 include only those of Wells Fargo, and exclude those of Wachovia for that period. For Wachovia loans accounted for under SOP 03-3, loan losses on SOP 03-3 loans in the first half of 2009, are reported as a reduction of the nonaccretable difference rather than as charge-offs. This affects the comparability of certain ratios as described on page 39.
(3)	The allowance for loan losses and the allowance for credit losses include $49 million for the quarter ended June 30, 2009, and none for prior periods related to loans acquired from Wachovia that are accounted for under SOP 03-3. Loans acquired from Wachovia are included in total loans net of related purchase accounting write-downs. These factors affect the comparability of these ratios for the quarters ended June 30, 2009, March 31, 2009, and December 31, 2008, to other periods presented as described on page 39.

 -30- 

Wells Fargo & Company and Subsidiaries
NONINTEREST INCOME

	Quarter ended June 30,						Six months ended June 30,
(in millions)	2009			2008			2009			2008
Service charges on deposit accounts	$	1,448			800			2,842			1,548
Trust and investment fees:
Trust, investment and IRA fees		839			566			1,561			1,125
Commissions and all other fees		1,574			196			3,067			400
Total trust and investment fees		2,413			762			4,628			1,525
Card fees		923			588			1,776			1,146
Other fees:
Cash network fees		58			47			116			95
Charges and fees on loans		440			251			873			499
All other fees		465			213			875			416
Total other fees		963			511			1,864			1,010
Mortgage banking:
Servicing income, net		753			221			1,596			494
Net gains on mortgage loan origination/sales activities		2,203			876			3,785			1,143
All other		90			100			169			191
Total mortgage banking		3,046			1,197			5,550			1,828
Insurance		595			550			1,176			1,054
Net gains from trading activities		749			516			1,536			619
Net gains (losses) on debt securities available for sale		(78	)		(91	)		(197	)		232
Net gains (losses) from equity investments		40			47			(117	)		360
Operating leases		168			120			298			263
All other		476			182			1,028			400
Total	$	10,743			5,182			20,384			9,985

NONINTEREST EXPENSE

	Quarter ended June 30,				Six months ended June 30,
(in millions)	2009		2008		2009		2008
Salaries	$	3,438		2,030		6,824		4,014
Commission and incentive compensation		2,060		806		3,884		1,450
Employee benefits		1,227		593		2,511		1,180
Equipment		575		305		1,262		653
Net occupancy		783		400		1,579		799
Core deposit and other intangibles		646		46		1,293		92
FDIC and other deposit assessments		981		18		1,319		26
Outside professional services		451		212		861		383
Insurance		259		206		526		367
Postage, stationery and supplies		240		138		490		279
Outside data processing		282		122		494		231
Travel and entertainment		131		112		236		217
Foreclosed assets		187		92		435		199
Contract services		256		104		472		212
Operating leases		61		102		131		218
Advertising and promotion		111		104		236		189
Telecommunications		164		82		322		160
Operating losses (reduction in losses)		159		56		331		(17	)
All other		686		317		1,309		635
Total	$	12,697		5,845		24,515		11,287

-31-

Wells Fargo & Company and Subsidiaries
FIVE QUARTER NONINTEREST INCOME

	Quarter ended
	June 30,			Mar. 31,			Dec. 31,			Sept. 30,			June 30,
(in millions)	2009			2009			2008			2008			2008
Service charges on deposit accounts	$	1,448			1,394			803			839			800
Trust and investment fees:
Trust, investment and IRA fees		839			722			487			549			566
Commissions and all other fees		1,574			1,493			174			189			196
Total trust and investment fees		2,413			2,215			661			738			762
Card fees		923			853			589			601			588
Other fees:
Cash network fees		58			58			45			48			47
Charges and fees on loans		440			433			272			266			251
All other fees		465			410			218			238			213
Total other fees		963			901			535			552			511
Mortgage banking:
Servicing income, net		753			843			(40	)		525			221
Net gains on mortgage loan origination/sales activities		2,203			1,582			(236	)		276			876
All other		90			79			81			91			100
Total mortgage banking		3,046			2,504			(195	)		892			1,197
Insurance		595			581			337			439			550
Net gains (losses) from trading activities		749			787			(409	)		65			516
Net gains (losses) on debt securities available for sale		(78	)		(119	)		721			84			(91	)
Net gains (losses) from equity investments		40			(157	)		(608	)		(509	)		47
Operating leases		168			130			62			102			120
All other		476			552			257			193			182
Total	$	10,743			9,641			2,753			3,996			5,182

FIVE QUARTER NONINTEREST EXPENSE

	Quarter ended
	June 30,		Mar. 31,		Dec. 31,		Sept. 30,		June 30,
(in millions)	2009		2009		2008		2008		2008
Salaries	$	3,438		3,386		2,168		2,078		2,030
Commission and incentive compensation		2,060		1,824		671		555		806
Employee benefits		1,227		1,284		338		486		593
Equipment		575		687		402		302		305
Net occupancy		783		796		418		402		400
Core deposit and other intangibles		646		647		47		47		46
FDIC and other deposit assessments		981		338		57		37		18
Outside professional services		451		410		258		206		212
Insurance		259		267		214		144		206
Postage, stationery and supplies		240		250		141		136		138
Outside data processing		282		212		127		122		122
Travel and entertainment		131		105		117		113		112
Foreclosed assets		187		248		116		99		92
Contract services		256		216		107		88		104
Operating leases		61		70		81		90		102
Advertising and promotion		111		125		93		96		104
Telecommunications		164		158		83		78		82
Operating losses		159		172		96		63		56
All other		686		623		276		359		317
Total	$	12,697		11,818		5,810		5,501		5,845

-32-

Wells Fargo & Company and Subsidiaries
AVERAGE BALANCES, YIELDS AND RATES PAID (TAXABLE-EQUIVALENT BASIS)(1)(2)

	Quarter ended June 30,
	2009								2008
							Interest								Interest
	Average			Yields/			income/		Average			Yields/			income/
(in millions)	balance			rates			expense		balance			rates			expense
Earning assets
Federal funds sold, securities purchased under resale agreements and other short-term investments	$	20,889			0.66	%	$	34		3,853			2.32	%	$	22
Trading assets		18,464			4.61			213		4,915			3.24			39
Debt securities available for sale (3):
Securities of U.S. Treasury and federal agencies		2,102			3.45			17		1,050			3.77			10
Securities of U.S. states and political subdivisions		12,189			6.47			206		7,038			6.62			118
Mortgage-backed securities:
Federal agencies		92,550			5.36			1,203		40,630			5.92			588
Residential and commercial		41,257			9.03			1,044		22,419			5.87			340
Total mortgage-backed securities		133,807			6.60			2,247		63,049			5.90			928
Other debt securities (4)		30,901			7.23			572		13,600			6.30			226
Total debt securities available for sale (4)		178,999			6.67			3,042		84,737			6.00			1,282
Mortgages held for sale (5)		43,177			5.05			545		28,004			6.04			423
Loans held for sale (5)		7,188			2.83			50		734			5.63			10
Loans:
Commercial and commercial real estate:
Commercial		187,501			4.11			1,922		95,263			6.09			1,444
Other real estate mortgage		104,297			3.46			900		39,977			5.77			573
Real estate construction		33,857			2.69			227		19,213			5.01			240
Lease financing		14,750			9.22			340		7,087			5.64			100
Total commercial and commercial real estate		340,405			3.99			3,389		161,540			5.86			2,357
Consumer:
Real estate 1-4 family first mortgage		240,798			5.53			3,328		73,663			6.79			1,250
Real estate 1-4 family junior lien mortgage		108,422			4.77			1,290		75,018			6.68			1,246
Credit card		22,963			12.74			731		19,037			11.81			561
Other revolving credit and installment		90,729			6.64			1,502		54,842			8.78			1,198
Total consumer		462,912			5.93			6,851		222,560			7.67			4,255
Foreign		30,628			4.06			310		7,445			10.61			197
Total loans (5)		833,945			5.07			10,550		391,545			6.98			6,809
Other		6,079			2.91			45		2,033			4.47			24
Total earning assets	$	1,108,741			5.21	%	$	14,479		515,821			6.69	%	$	8,609
Funding sources
Deposits:
Interest-bearing checking	$	79,955			0.13	%	$	26		5,487			1.18	%	$	16
Market rate and other savings		334,067			0.40			336		161,760			1.21			486
Savings certificates		152,444			1.19			451		37,634			3.06			287
Other time deposits		21,660			2.00			108		5,773			2.72			38
Deposits in foreign offices		49,885			0.29			36		51,884			1.83			236
Total interest-bearing deposits		638,011			0.60			957		262,538			1.63			1,063
Short-term borrowings		59,844			0.39			58		66,537			2.16			357
Long-term debt		235,590			2.52			1,484		100,552			3.41			856
Other liabilities		4,604			3.45			40		—			—			—
Total interest-bearing liabilities		938,049			1.08			2,539		429,627			2.13			2,276
Portion of noninterest-bearing funding sources		170,692			—			—		86,194			—			—
Total funding sources	$	1,108,741			0.91			2,539		515,821			1.77			2,276
Net interest margin and net interest income on a taxable-equivalent basis (6)					4.30	%	$	11,940					4.92	%	$	6,333
Noninterest-earning assets
Cash and due from banks	$	19,340								10,875
Goodwill		24,261								13,171
Other		122,584								54,882
Total noninterest-earning assets	$	166,185								78,928
Noninterest-bearing funding sources
Deposits	$	174,529								88,041
Other liabilities		49,570								28,434
Total equity		112,778								48,647
Noninterest-bearing funding sources used to fund earning assets		(170,692	)							(86,194	)
Net noninterest-bearing funding sources	$	166,185								78,928
Total assets	$	1,274,926								594,749

(1)	Our average prime rate was 3.25% and 5.08% for the quarters ended June 30, 2009 and 2008, respectively. The average three-month London Interbank Offered Rate (LIBOR) was 0.84% and 2.75% for the same quarters, respectively.
(2)	Interest rates and amounts include the effects of hedge and risk management activities associated with the respective asset and liability categories.
(3)	Yields are based on amortized cost balances computed on a settlement date basis.
(4)	Includes certain preferred securities.
(5)	Nonaccrual loans and related income are included in their respective loan categories.
(6)	Includes taxable-equivalent adjustments primarily related to tax-exempt income on certain loans and securities. The federal statutory tax rate was 35% for the periods presented.

-33-

Wells Fargo & Company and Subsidiaries
AVERAGE BALANCES, YIELDS AND RATES PAID (TAXABLE-EQUIVALENT BASIS)(1)(2)

	Six months ended June 30,
	2009								2008
							Interest								Interest
	Average			Yields/			income/		Average			Yields/			income/
(in millions)	balance			rates			expense		balance			rates			expense
Earning assets
Federal funds sold, securities purchased under resale agreements and other short-term investments	$	22,472			0.75	%	$	84		3,870			2.81	%	$	54
Trading assets		20,323			4.81			488		5,022			3.49			87
Debt securities available for sale (3):
Securities of U.S. Treasury and federal agencies		2,498			2.00			24		1,012			3.81			19
Securities of U.S. states and political subdivisions		12,201			6.45			419		6,664			7.00			238
Mortgage-backed securities:
Federal agencies		84,592			5.51			2,271		38,364			6.00			1,123
Residential and commercial		39,980			8.80			2,061		21,706			5.97			664
Total mortgage-backed securities		124,572			6.71			4,332		60,070			5.99			1,787
Other debt securities (4)		30,493			7.02			1,123		12,213			6.58			422
Total debt securities available for sale (4)		169,764			6.68			5,898		79,959			6.14			2,466
Mortgages held for sale (5)		37,151			5.17			960		27,138			6.02			817
Loans held for sale (5)		7,567			3.13			117		691			6.52			22
Loans:
Commercial and commercial real estate:
Commercial		192,186			3.99			3,806		93,174			6.50			3,013
Other real estate mortgage		104,283			3.47			1,794		38,701			6.09			1,173
Real estate construction		34,174			2.86			485		19,073			5.53			525
Lease financing		15,277			8.99			687		6,956			5.71			198
Total commercial and commercial real estate		345,920			3.94			6,772		157,904			6.25			4,909
Consumer:
Real estate 1-4 family first mortgage		243,133			5.59			6,772		72,985			6.84			2,496
Real estate 1-4 family junior lien mortgage		109,270			4.91			2,665		75,140			6.99			2,614
Credit card		23,128			12.42			1,435		18,907			12.06			1,140
Other revolving credit and installment		91,770			6.66			3,029		55,376			8.94			2,462
Total consumer		467,301			5.98			13,901		222,408			7.86			8,712
Foreign		31,487			4.22			659		7,420			10.94			404
Total loans (5)		844,708			5.08			21,332		387,732			7.26			14,025
Other		6,110			2.89			88		1,930			4.50			44
Total earning assets	$	1,108,095			5.22	%	$	28,967		506,342			6.94	%	$	17,515
Funding sources
Deposits:
Interest-bearing checking	$	80,173			0.14	%	$	56		5,357			1.54	%	$	41
Market rate and other savings		323,813			0.47			755		160,812			1.59			1,270
Savings certificates		161,234			1.05			838		39,774			3.54			700
Other time deposits		23,597			1.98			232		5,269			3.09			80
Deposits in foreign offices		47,901			0.32			75		49,262			2.31			566
Total interest-bearing deposits		636,718			0.62			1,956		260,474			2.05			2,657
Short-term borrowings		67,911			0.54			181		59,754			2.63			782
Long-term debt		247,209			2.65			3,267		100,619			3.85			1,933
Other liabilities		4,194			3.64			76		—			—			—
Total interest-bearing liabilities		956,032			1.15			5,480		420,847			2.56			5,372
Portion of noninterest-bearing funding sources		152,063			—			—		85,495			—			—
Total funding sources	$	1,108,095			0.99			5,480		506,342			2.13			5,372
Net interest margin and net interest income on a taxable-equivalent basis (6)					4.23	%	$	23,487					4.81	%	$	12,143
Noninterest-earning assets
Cash and due from banks	$	19,795								11,262
Goodwill		23,725								13,166
Other		130,665								54,101
Total noninterest-earning assets	$	174,185								78,529
Noninterest-bearing funding sources
Deposits	$	167,458								86,464
Other liabilities		50,064								29,246
Total equity		108,726								48,314
Noninterest-bearing funding sources used to fund earning assets		(152,063	)							(85,495	)
Net noninterest-bearing funding sources	$	174,185								78,529
Total assets	$	1,282,280								584,871

(1)	Our average prime rate was 3.25% and 5.65% for the six months ended June 30, 2009 and 2008, respectively. The average three-month London Interbank Offered Rate (LIBOR) was 1.04% and 3.02% for the same periods, respectively.
(2)	Interest rates and amounts include the effects of hedge and risk management activities associated with the respective asset and liability categories.
(3)	Yields are based on amortized cost balances computed on a settlement date basis.
(4)	Includes certain preferred securities.
(5)	Nonaccrual loans and related income are included in their respective loan categories.
(6)	Includes taxable-equivalent adjustments primarily related to tax-exempt income on certain loans and securities. The federal statutory tax rate was 35% for the periods presented.

-34-

Wells Fargo & Company and Subsidiaries
OPERATING SEGMENT RESULTS(1)

	Community				Wholesale					Wealth, Brokerage											Consolidated
(income/expense in millions,	Banking				Banking					and Retirement					Other (2)						Company
average balances in billions)	2009		2008		2009		2008			2009			2008		2009			2008			2009		2008
Quarter ended June 30,
Net interest income (3)	$	8,784		5,235		2,479		1,025			764			199		(263	)		(181	)		11,764		6,278
Provision for credit losses		4,264		2,766		738		246			115			4		(31	)		(4	)		5,086		3,012
Noninterest income		6,023		3,637		2,759		1,388			2,222			481		(261	)		(324	)		10,743		5,182
Noninterest expense		7,665		4,300		2,807		1,358			2,289			497		(64	)		(310	)		12,697		5,845
Income (loss) before income tax expense (benefit)		2,878		1,806		1,693		809			582			179		(429	)		(191	)		4,724		2,603
Income tax expense (benefit)		798		604		618		235			222			68		(163	)		(73	)		1,475		834
Net income (loss) before noncontrolling interests		2,080		1,202		1,075		574			360			111		(266	)		(118	)		3,249		1,769
Less: Net income (loss) from noncontrolling interests		72		18		8		(2	)		(3	)		—		—			—			77		16
Net income (loss)	$	2,008		1,184		1,067		576			363			111		(266	)		(118	)		3,172		1,753
Average loans	$	540.7		283.2		263.5		107.7			45.9			14.8		(16.2	)		(14.2	)		833.9		391.5
Average assets		799.2		439.9		381.7		151.4			110.2			17.8		(16.2	)		(14.4	)		1,274.9		594.7
Average core deposits		543.9		251.1		138.1		64.8			113.5			22.5		(29.8	)		(20.0	)		765.7		318.4
Six months ended June 30,
Net interest income (3)	$	17,281		9,953		4,846		2,051			1,501			353		(488	)		(319	)		23,140		12,038
Provision for credit losses		8,268		4,631		1,283		407			140			6		(47	)		(4	)		9,644		5,040
Noninterest income		11,479		7,119		5,299		2,539			4,124			964		(518	)		(637	)		20,384		9,985
Noninterest expense		14,823		8,205		5,338		2,702			4,508			982		(154	)		(602	)		24,515		11,287
Income (loss) before income tax expense (benefit)		5,669		4,236		3,524		1,481			977			329		(805	)		(350	)		9,365		5,696
Income tax expense (benefit)		1,688		1,501		1,265		415			380			125		(306	)		(133	)		3,027		1,908
Net income (loss) before noncontrolling interests		3,981		2,735		2,259		1,066			597			204		(499	)		(217	)		6,338		3,788
Less: Net income (loss) from noncontrolling interests		134		29		12		7			(25	)		—		—			—			121		36
Net income (loss)	$	3,847		2,706		2,247		1,059			622			204		(499	)		(217	)		6,217		3,752
Average loans	$	546.7		282.9		267.7		104.3			46.3			14.3		(16.0	)		(13.8	)		844.7		387.7
Average assets		798.6		435.9		392.7		145.7			107.1			17.3		(16.1	)		(14.0	)		1,282.3		584.9
Average core deposits		540.9		248.8		138.3		66.5			108.1			21.8		(27.5	)		(19.3	)		759.8		317.8

(1)	The management accounting process measures the performance of the operating segments based on our management structure and is not necessarily comparable with other similar information for other financial services companies. We define our operating segments by product type and customer segment. As a result of the combination of Wells Fargo and Wachovia, management realigned its segments into the following three lines of business: Community Banking; Wholesale Banking; and Wealth, Brokerage and Retirement Services. We revised prior period information to reflect this realignment; however, segment information for periods prior to the first quarter of 2009 does not include Wachovia information.
(2)	“Other” includes integration expenses and the elimination of items that are included in both Community Banking and Wealth, Brokerage and Retirement Services, largely representing wealth management customers serviced and products sold in the stores.
(3)	Net interest income is the difference between interest earned on assets and the cost of liabilities to fund those assets. Interest earned includes actual interest earned on segment assets and, if the segment has excess liabilities, interest credits for providing funding to other segments. The cost of liabilities includes interest expense on segment liabilities and, if the segment does not have enough liabilities to fund its assets, a funding charge based on the cost of excess liabilities from another segment.

-35-

Wells Fargo & Company and Subsidiaries
FIVE QUARTER OPERATING SEGMENT RESULTS(1)

	Quarter ended
	June 30,			Mar. 31,			Dec. 31,			Sept. 30,			June 30,
(income/expense in millions, average balances in billions)	2009			2009			2008			2008			2008
COMMUNITY BANKING
Net interest income (2)	$	8,784			8,497			5,296			5,293			5,235
Provision for credit losses		4,264			4,004			6,789			2,202			2,766
Noninterest income		6,023			5,456			2,096			3,209			3,637
Noninterest expense		7,665			7,158			4,320			3,982			4,300
Income (loss) before income tax expense (benefit)		2,878			2,791			(3,717	)		2,318			1,806
Income tax expense (benefit)		798			890			(1,606	)		764			604
Net income (loss) before noncontrolling interests		2,080			1,901			(2,111	)		1,554			1,202
Less: Net income (loss) from noncontrolling interests		72			62			(11	)		14			18
Segment net income (loss)	$	2,008			1,839			(2,100	)		1,540			1,184
Average loans		540.7			552.8			288.9			287.1			283.2
Average assets		799.2			797.9			466.0			452.3			439.9
Average core deposits		543.9			538.0			260.6			252.8			251.1
WHOLESALE BANKING
Net interest income (2)	$	2,479			2,367			1,400			1,065			1,025
Provision for credit losses		738			545			414			294			246
Noninterest income		2,759			2,540			515			631			1,388
Noninterest expense		2,807			2,531			1,251			1,329			1,358
Income before income tax expense (benefit)		1,693			1,831			250			73			809
Income tax expense (benefit)		618			647			31			(30	)		235
Net income before noncontrolling interests		1,075			1,184			219			103			574
Less: Net income (loss) from noncontrolling interests		8			4			4			—			(2	)
Segment net income	$	1,067			1,180			215			103			576
Average loans		263.5			271.9			124.2			116.3			107.7
Average assets		381.7			403.8			163.2			158.1			151.4
Average core deposits		138.1			138.5			81.0			64.4			64.8
WEALTH, BROKERAGE AND RETIREMENT
Net interest income (2)	$	764			737			251			223			199
Provision for credit losses		115			25			293			3			4
Noninterest income		2,222			1,902			417			458			481
Noninterest expense		2,289			2,219			512			498			497
Income (loss) before income tax expense (benefit)		582			395			(137	)		180			179
Income tax expense (benefit)		222			158			(52	)		68			68
Net income (loss) before noncontrolling interests		360			237			(85	)		112			111
Less: Net loss from noncontrolling interests		(3	)		(22	)		—			—			—
Segment net income (loss)	$	363			259			(85	)		112			111
Average loans		45.9			46.7			16.5			15.9			14.8
Average assets		110.2			104.0			20.0			19.1			17.8
Average core deposits		113.5			102.6			25.6			23.5			22.5
OTHER(3)
Net interest income (2)	$	(263	)		(225	)		(223	)		(200	)		(181	)
Provision for credit losses		(31	)		(16	)		948			(4	)		(4	)
Noninterest income		(261	)		(257	)		(275	)		(302	)		(324	)
Noninterest expense		(64	)		(90	)		(273	)		(308	)		(310	)
Loss before income tax benefit		(429	)		(376	)		(1,173	)		(190	)		(191	)
Income tax benefit		(163	)		(143	)		(409	)		(72	)		(73	)
Net loss before noncontrolling interests		(266	)		(233	)		(764	)		(118	)		(118	)
Less: Net income from noncontrolling interests		—			—			—			—			—
Other net loss	$	(266	)		(233	)		(764	)		(118	)		(118	)
Average loans		(16.2	)		(15.8	)		(15.7	)		(15.1	)		(14.2	)
Average assets		(16.2	)		(16.0	)		(16.0	)		(15.3	)		(14.4	)
Average core deposits		(29.8	)		(25.2	)		(22.2	)		(20.6	)		(20.0	)
CONSOLIDATED COMPANY
Net interest income (2)	$	11,764			11,376			6,724			6,381			6,278
Provision for credit losses		5,086			4,558			8,444			2,495			3,012
Noninterest income		10,743			9,641			2,753			3,996			5,182
Noninterest expense		12,697			11,818			5,810			5,501			5,845
Income (loss) before income tax expense (benefit)		4,724			4,641			(4,777	)		2,381			2,603
Income tax expense (benefit)		1,475			1,552			(2,036	)		730			834
Net income (loss) before noncontrolling interests		3,249			3,089			(2,741	)		1,651			1,769
Less: Net income (loss) from noncontrolling interests		77			44			(7	)		14			16
Wells Fargo net income (loss)	$	3,172			3,045			(2,734	)		1,637			1,753
Average loans		833.9			855.6			413.9			404.2			391.5
Average assets		1,274.9			1,289.7			633.2			614.2			594.7
Average core deposits		765.7			753.9			345.0			320.1			318.4

(1)	The management accounting process measures the performance of the operating segments based on our management structure and is not necessarily comparable with other similar information for other financial services companies. We define our operating segments by product type and customer segment. As a result of the combination of Wells Fargo and Wachovia, management realigned its segments into the following three lines of business: Community Banking; Wholesale Banking; and Wealth, Brokerage and Retirement Services. We revised prior period information to reflect this realignment; however, segment information for periods prior to the first quarter of 2009 does not include Wachovia information.
(2)	Net interest income is the difference between interest earned on assets and the cost of liabilities to fund those assets. Interest earned includes actual interest earned on segment assets and, if the segment has excess liabilities, interest credits for providing funding to other segments. The cost of liabilities includes interest expense on segment liabilities and, if the segment does not have enough liabilities to fund its assets, a funding charge based on the cost of excess liabilities from another segment.
(3)	“Other” includes integration expenses and the elimination of items that are included in both Community Banking and Wealth, Brokerage and Retirement Services, largely representing wealth management customers serviced and products sold in the stores. “Other” also includes the $1.2 billion provision for credit losses recorded at the enterprise level in fourth quarter 2008 to conform Wachovia estimated loss emergence coverage periods to Wells Fargo policies.

-36-

Wells Fargo & Company and Subsidiaries
FIVE QUARTER CONSOLIDATED MORTGAGE SERVICING

	Quarter ended
	June 30,			Mar. 31,			Dec. 31,			Sept. 30,			June 30,
(in millions)	2009			2009			2008			2008			2008
Residential MSRs measured using the fair value method:
Fair value, beginning of quarter	$	12,391			14,714			19,184			19,333			14,956
Purchases		—			—			—			57			82
Acquired from Wachovia (1)		—			34			479			—			—
Servicing from securitizations or asset transfers		2,081			1,447			808			851			994
Sales		—			—			—			—			(177	)
Net additions		2,081			1,481			1,287			908			899
Changes in fair value:
Due to changes in valuation model inputs or assumptions (2)		2,316			(2,824	)		(5,129	)		(546	)		4,132
Other changes in fair value (3)		(1,098	)		(980	)		(628	)		(511	)		(654	)
Total changes in fair value		1,218			(3,804	)		(5,757	)		(1,057	)		3,478
Fair value, end of quarter	$	15,690			12,391			14,714			19,184			19,333

(1)	First quarter 2009 results reflect refinements to initial purchase accounting adjustments.
(2)	Principally reflects changes in discount rates and prepayment speed assumptions, mostly due to changes in interest rates.
(3)	Represents changes due to collection/realization of expected cash flows over time.

	Quarter ended
	June 30,			Mar. 31,			Dec. 31,			Sept. 30,			June 30,
(in millions)	2009			2009			2008			2008			2008
Amortized MSRs:
Balance, beginning of quarter	$	1,257			1,446			433			442			455
Purchases		6			4			3			2			2
Acquired from Wachovia (1)		(8	)		(127	)		1,021			—			—
Servicing from securitizations or asset transfers		18			4			7			8			4
Amortization		(68	)		(70	)		(18	)		(19	)		(19	)
Balance, end of quarter (2)	$	1,205			1,257			1,446			433			442
Fair value of amortized MSRs:
Beginning of quarter	$	1,392			1,555			622			595			601
End of quarter		1,311			1,392			1,555			622			595

(1)	2009 periods reflect refinements to initial purchase accounting adjustments.
(2)	There was no valuation allowance recorded for the periods presented.

-37-

Wells Fargo & Company and Subsidiaries
FIVE QUARTER CONSOLIDATED MORTGAGE SERVICING (CONTINUED)

	Quarter ended
	June 30,			Mar. 31,			Dec. 31,			Sept. 30,			June 30,
(in millions)	2009			2009			2008			2008			2008
Servicing income, net:
Servicing fees (1)	$	888			1,018			952			980			959
Changes in fair value of residential MSRs:
Due to changes in valuation model inputs or assumptions (2)		2,316			(2,824	)		(5,129	)		(546	)		4,132
Other changes in fair value (3)		(1,098	)		(980	)		(628	)		(511	)		(654	)
Total changes in fair value of residential MSRs		1,218			(3,804	)		(5,757	)		(1,057	)		3,478
Amortization		(68	)		(70	)		(18	)		(19	)		(19	)
Net derivative gains (losses) from economic hedges (4)		(1,285	)		3,699			4,783			621			(4,197	)
Total servicing income, net		753			843			(40	)		525			221
Market related valuation changes to MSRs, net of hedge results (2)+(4)	$	1,031			875			(346	)		75			(65	)

(1)	Includes contractually specified servicing fees, late charges and other ancillary revenues.
(2)	Principally reflects changes in discount rates and prepayment speed assumptions, mostly due to changes in interest rates.
(3)	Represents changes due to collection/realization of expected cash flows over time.
(4)	Represents results from free-standing derivatives (economic hedges) used to hedge the risk of changes in fair value of MSRs.

	June 30,			Mar. 31,		Dec. 31,		Sept. 30,		June 30,
(in billions)	2009			2009		2008		2008		2008
Managed servicing portfolio:
Residential mortgage loans serviced for others (1)	$	1,394			1,379		1,388		1,323		1,305
Owned loans serviced (2)		270			267		268		96		99
Total owned residential mortgage loans serviced		1,664			1,646		1,656		1,419		1,404
Commercial mortgage loans serviced for others		470			474		472		142		142
Total owned mortgage servicing portfolio		2,134			2,120		2,128		1,561		1,546
Sub-servicing		22			23		26		19		20
Total managed servicing portfolio	$	2,156			2,143		2,154		1,580		1,566
Ratio of MSRs to related loans serviced for others		0.91	%		0.74		0.87		1.34		1.37
Weighted-average note rate (owned servicing only)		5.74			5.83		5.92		5.98		6.00

(1)	Consists of 1-4 family first mortgage loans.
(2)	Consists of residential mortgages held for sale and 1-4 family first mortgage loans.

-38-

Wells Fargo & Company and Subsidiaries
SELECTED FIVE QUARTER RESIDENTIAL MORTGAGE PRODUCTION DATA

	Quarter ended
	June 30,			Mar. 31,		Dec. 31,		Sept. 30,		June 30,
(in billions)	2009			2009		2008		2008		2008
Application data:
Wells Fargo Home Mortgage first mortgage quarterly applications	$	194			190		116		83		100
Refinances as a percentage of applications		73	%		82		68		39		44
Wells Fargo Home Mortgage first mortgage unclosed pipeline, at quarter end	$	90			100		71		41		47

	Quarter ended
	June 30,		Mar. 31,		Dec. 31,		Sept. 30,		June 30,
(in billions)	2009		2009		2008		2008		2008
Residential Real Estate Originations:(1)
Wells Fargo Home Mortgage first mortgage loans:
Retail	$	71		51		20		23		31
Correspondent/Wholesale		57		49		28		25		27
Home equity loans and lines		1		1		1		2		3
Wells Fargo Financial		—		—		1		1		2
Total quarter-to-date	$	129		101		50		51		63
Total year-to-date	$	230		101		230		180		129

(1) Consists of residential real estate originations from all Wells Fargo channels.

-39-

Wells Fargo & Company and Subsidiaries
LOANS SUBJECT TO SOP 03-3

Certain loans acquired from Wachovia have evidence of credit deterioration since origination and it is probable that we will not collect all contractually required principal and interest payments (referred to as “credit impaired” loans). Such loans are accounted for under American Institute of Certified Public Accountants Statement of Position 03-3,Accounting for Certain Loans or Debt Securities Acquired in a Transfer(SOP 03-3). SOP 03-3 requires that acquired loans be recorded at fair value at the acquisition date and prohibits carryover of the related allowance for loan losses. The difference between contractually required payments and cash flows expected to be collected is referred to as the nonaccretable difference. The difference between the cash flows expected to be collected and the fair value is referred to as the accretable yield.

Because SOP 03-3 loans have been written down in purchase accounting to an amount estimated to be collectible, such loans are not classified as nonaccrual even though they may be contractually past due. Also, losses on such loans are charged against the nonaccretable difference established in purchase accounting and, as such, are not reported as charge-offs.

As a result of the application of SOP 03-3 to credit-impaired Wachovia loans, certain ratios of the combined company cannot be used to compare a portfolio that includes acquired credit-impaired loans accounted for under SOP 03-3 against one that does not, or to compare ratios across quarters or years. The ratios particularly affected by the accounting under SOP 03-3 include the allowance for loan losses and allowance for credit losses as percentages of loans, of nonaccrual loans and of nonperforming assets; nonaccrual loans and nonperforming assets as a percentage of total loans; and net charge-offs as a percentage of loans.

	June 30, 2009 (1)						March 31, 2009						December 31, 2008
			All						All						All
	SOP 03-3		other				SOP 03-3		other				SOP 03-3		other
(in millions)	loans		loans		Total		loans		loans		Total		loans		loans		Total
Commercial and commercial real estate:
Commercial	$	2,667		179,370		182,037		3,088		188,623		191,711		4,580		197,889		202,469
Other real estate mortgage		5,826		97,828		103,654		6,597		98,337		104,934		7,762		95,346		103,108
Real estate construction		4,295		28,943		33,238		4,507		29,405		33,912		4,503		30,173		34,676
Lease financing		—		14,555		14,555		—		14,792		14,792		—		15,829		15,829
Total commercial and commercial real estate		12,788		320,696		333,484		14,192		331,157		345,349		16,845		339,237		356,082
Consumer:
Real estate 1-4 family first mortgage		40,471		196,818		237,289		41,520		201,427		242,947		39,214		208,680		247,894
Real estate 1-4 family junior lien mortgage		398		106,626		107,024		615		109,133		109,748		728		109,436		110,164
Credit card		—		23,069		23,069		—		22,815		22,815		—		23,555		23,555
Other revolving credit and installment		—		90,654		90,654		32		91,220		91,252		151		93,102		93,253
Total consumer		40,869		417,167		458,036		42,167		424,595		466,762		40,093		434,773		474,866
Foreign		1,554		28,540		30,094		1,849		29,619		31,468		1,859		32,023		33,882
Total loans	$	55,211		766,403		821,614		58,208		785,371		843,579		58,797		806,033		864,830

(1) In the first and second quarters of 2009, we refined certain of our preliminary purchase accounting adjustments based on additional information as of December 31, 2008. These refinements include a net increase to the nonaccretable difference of $3.8 billion ($2.2 billion of which related to Pick-a-Pay loans), and a net increase to the accretable yield of $1.9 billion ($2.0 billion of which related to Pick-a-Pay loans and reflects changes in the amount and timing of cash flows). The effect on goodwill of these adjustments amounted to a net increase to goodwill of $1.9 billion.

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Wells Fargo & Company and Subsidiaries
HOME EQUITY PORTFOLIOS(1)

					% of loans
					two payments					Annualized
	Outstanding balances				or more past due					loss rate
	June 30,		Mar. 31,		June 30,			Mar. 31,		June 30,		Mar. 31,
(in millions)	2009		2009		2009			2009		2009		2009
Core portfolio(2)
California	$	31,479		31,784		3.63	%		3.56		5.36		3.97
Florida		11,697		12,067		3.91			3.73		4.55		2.03
New Jersey		8,224		8,086		1.70			1.58		1.37		0.45
Virginia		5,805		5,653		1.26			1.45		0.99		0.76
Pennsylvania		5,048		5,129		1.46			1.04		1.29		0.29
Other		55,248		56,342		2.22			2.06		2.46		1.59
Total		117,501		119,061		2.65			2.53		3.25		2.09
Liquidating portfolio
California		3,616		3,835		8.16			8.49		17.13		13.98
Florida		460		492		9.14			10.35		18.11		13.33
Arizona		219		233		8.16			8.37		18.13		15.04
Texas		169		179		1.13			1.40		2.96		2.66
Minnesota		117		122		3.88			3.88		7.41		6.92
Other		4,764		5,001		4.00			3.96		6.25		5.29
Total		9,345		9,862		5.91			6.10		11.29		9.27
Total core and liquidating portfolios	$	126,846		128,923		2.89			2.80		3.85		2.65

(1)	Consists of real estate 1-4 family junior lien mortgages and lines of credit secured by real estate from all groups, excluding SOP 03-3 loans.
(2)	Includes equity lines of credit and closed-end second liens associated with the Pick-a-Pay portfolio totaling $2.0 billion and $2.1 billion at June 30, 2009, and March 31, 2009, respectively. Related credit losses for first quarter 2009 of $12 million are reported separately with the Pick-a-Pay portfolio.

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Wells Fargo & Company and Subsidiaries
PICK-A-PAY PORTFOLIO

	SOP 03-3 loans										All other loans
								Ratio of
								carrying
	Unpaid		Current					value to			Unpaid		Current
	principal		LTV			Carrying		current			principal		LTV			Carrying
(in millions)	balance		ratio (1)			value (2)		value			balance		ratio (1)			value
June 30, 2009
California	$	40,657		146	%	$	26,177		95	%	$	25,117		90	%	$	25,170
Florida		6,117		130			3,903		84			5,276		96			5,287
New Jersey		1,717		99			1,226		71			3,162		80			3,169
Texas		466		80			341		59			2,108		66			2,112
Arizona		1,553		148			1,001		96			1,195		99			1,197
Other states		9,041		108			6,227		75			14,607		83			14,640
Total Pick-a-Pay loans	$	59,551				$	38,875				$	51,465				$	51,575
March 31, 2009
California	$	42,216		152		$	26,907		98		$	25,875		90		$	25,979
Florida		6,260		129			3,779		79			5,412		92			5,433
New Jersey		1,750		101			1,271		74			3,358		76			3,372
Texas		475		76			336		54			2,204		60			2,213
Arizona		1,642		161			987		99			1,239		104			1,244
Other states		9,306		110			6,397		77			15,282		79			15,324
Total Pick-a-Pay loans	$	61,649				$	39,677				$	53,370				$	53,565

(1)

The current LTV ratio is calculated as the outstanding loan balance plus the outstanding balance of any equity lines of credit that share common collateral divided by the collateral value. Collateral values are determined using automated valuation models (AVM) and are updated quarterly. AVMs are computer-based tools used to estimate market values of homes based on processing large volumes of market data including market comparables and price trends for local market areas.

(2)

Carrying value, which does not reflect the allowance for loan losses, includes purchase accounting adjustments, which, for SOP 03-3 loans, are a deduction of $24.5 billion nonaccretable difference and an addition of $3.8 billion accretable yield at June 30, 2009, and for all other loans, an adjustment to mark the loans to a market yield at date of merger less any subsequent charge-offs.