Wells Fargo eyes up Irish market

US banking giant Wells Fargo is eyeing up a potential move into the Irish market.

According to a banking source in London, who did not want to be named, four senior Wells Fargo executives have been relocated from the US to London to look at the UK and Ireland. It is not known what type of presence the US bank would consider in this country.

A spokesperson for Wells Fargo in London said it is not company policy to comment on market rumours.

Wells Fargo is one of the largest banks in the US by market capitalisations. According to the firm’s 2011 annual report, it had a net income of $15.9bn (€12.2bn) for the year; deposits reached $920.1bn and loans stood at $769.6bn.

However, it has traditionally had an almost exclusive focus on North America. But during the US banking crisis, it was forced to take over the troubled operations of its rival Wachovia.

Wachovia had representative offices in 20 countries. According to media reports earlier this year, Wells Fargo embarked on a major international expansion — spearheaded by the former head of HSBC China, Richard Yorke.

Most of the expansion is in the area of corporate banking, even though Wells Fargo is traditionally associated with retail banking.

Ireland is still reeling from one of the worst banking crises to hit any western economy. Inevitably there has been massive consolidation and scaling back over the past few years.

AIB and Permanent TSB are both fully nationalised. Anglo Irish Bank and Irish Nationwide Building Society are both being wound down through the Irish Bank Resolution Corporation.

Bank of Ireland is 15% state-owned. Danske Bank has closed down its retail presence in this country, although it still offers corporate services. Bank of Scotland has exited the Irish market nursing heavy losses. EBS has been rolled into AIB.

There was speculation earlier this year that Royal Bank of Scotland would look to offload or close down its Irish subsidiary, Ulster Bank. It is believed RBS took a decision after a strategic review of all operations, that Ulster Bank will remain open for business in this country, although on a much smaller scale.

If the Irish economy recovers, then Ulster Bank could be a lucrative play for a new banking force.