exv99

Tuesday, October 19, 2004
WELLS FARGO REPORTS DOUBLE-DIGIT GROWTH IN EARNINGS PER
SHARE AND NET INCOME

Third Quarter 2004 Highlights:

•		Diluted earnings per share of $1.02, up 11 percent from prior year’s $.92

•		Net income of $1.75 billion, up 12 percent from prior year’s $1.56 billion

•		Revenue flat from prior year; 11 percent revenue growth in businesses other than Wells Fargo Home Mortgage

•		Noninterest expenses down 8 percent from prior year; flat excluding Wells Fargo Home Mortgage

•		Strong balance sheet growth

◦		Average loans up 27 percent from prior year
◦		Average commercial and commercial real estate loans up 9 percent from prior year
◦		Average core deposits up 10 percent from prior year excluding mortgage escrow deposits

•

Improved asset quality

◦		Nonperforming assets down $150 million, or 9 percent, from prior year
◦		Net charge-offs down $17 million, or 4 percent, from prior year

SAN FRANCISCO – Wells Fargo & Company (NYSE:WFC) reported diluted earnings per common share of $1.02 for third quarter 2004, compared with $.92 in third quarter 2003, up 11 percent. Net income was $1.75 billion, up 12 percent from $1.56 billion in third quarter 2003. For the first nine months of 2004, net income was $5.23 billion, up 14 percent from the first nine months of 2003, and diluted earnings per share were $3.05, up 13 percent from the first nine months of 2003.

“This was our twelfth consecutive quarter of double-digit earnings per share growth,” said Chairman and CEO Dick Kovacevich. “We continued to invest for the ‘Next Stage’ of our success at a rate unprecedented in our company’s history. Compared with third quarter last year, we have over three times as many bankers licensed to sell products such as mutual funds and annuities, 17 percent more team members selling and serving customers in our banking stores and 16 percent more at Wells Fargo Financial, our consumer finance company. We’ve announced a long-term goal of doubling the number of our commission-based home mortgage consultants, currently numbering 10,000. We’ve opened 72 new banking stores this year, an average of two per week, and we’re on track to add by year-end 100 new banking stores and 80 new consumer finance stores. By year-end, we’ll have remodeled 261 banking stores.

Much of our growth continued to come from earning more business from our current customers. The attitude and commitment of our team members is the single biggest factor influencing our customers to entrust us with more of their business. Every month this year, through needs-based selling, we’ve had more than one million retail banking product sales, a company record. Almost one of every three of our new checking account customers now has a Wells Fargo product pack, which is a checking account and at least three other products such as a debit card, credit card and online banking. With our recently announced alliance with Grupo Financiero Banorte, in addition to those with HSBC Mexico and BBVA Bancomer, we now have the largest network for remitting funds to Mexico of any U.S. financial services company. In Florida, where we employ more than 1,800 team members and have 140 mortgage and consumer finance stores, we’re proud to have supported disaster relief efforts.”

“We continued to take advantage of unusually volatile markets in the third quarter, selling approximately $4 billion of securities and adjustable rate mortgages (ARMs) following the big drop in long-term interest rates and narrowing of credit spreads. These repositioning actions resulted in $10 million of bond gains and $35 million of losses on loans. In addition, given the decline in long-term rates during the quarter, mortgage banking fees were reduced by

$130 million due primarily to an addition to the impairment valuation allowance for mortgage servicing rights (MSRs).”

Home Mortgage revenue declined $623 million, or 40 percent, from $1.5 billion in third quarter 2003 to $.9 billion in third quarter 2004 due to a decline of $93 billion, or 58 percent, in mortgage originations driven by the increase in long-term rates from last year’s record lows. Home Mortgage revenue declined almost $400 million on a linked-quarter basis due primarily to the decline in originations from the second quarter 2004 ‘mini-refi’ wave and to the $211 million increase in the MSRs valuation allowance. The third quarter impairment valuation provision increased the MSRs valuation allowance to $1.8 billion at quarter end. At September 30, 2004, MSRs were $7.8 billion, or 1.18 percent of loans serviced for others compared with 1.37 percent at June 30, 2004.

“In addition to commercial loan growth, we saw continued strong demand for consumer credit,” said Atkins. Average consumer loans increased $49.1 billion, or 38 percent, from third quarter 2003, and $5.4 billion, or 12 percent (annualized), on a linked-quarter basis. Growth was broad-based across home equity, residential mortgage, credit card, revolving credit and installment loan products.

Average retail core deposits, excluding mortgage escrow deposits, grew 11 percent from third quarter 2003 and 8 percent (annualized) on a linked-quarter basis. Average consumer checking account balances grew 13 percent from third quarter 2003 and 6 percent (annualized) on a linked-quarter basis, reflecting a 6 percent net increase in consumer checking accounts from a year ago and higher average balances.

Net interest income for third quarter 2004 increased 7 percent from a year ago. Despite the decline in mortgages held for sale from last year, earning assets were up 9 percent due to the 27 percent growth in average commercial and consumer loans. On a linked-quarter basis, net interest income was strong, up $192 million, or 18 percent (annualized). This was driven by an $8 billion increase in average total loans, a 12 percent (annualized) increase, and a 6 basis point increase in the net interest margin to 4.89 percent, partly due to balance sheet repositioning actions taken in the last few quarters. This was the first quarterly increase in the margin in the past 10 quarters. At September 30, 2004, the Company had $1.4 billion in unrealized gains on securities available for sale, up from $1.2 billion at June 30, 2004.

Noninterest income declined $291 million, or 9 percent, from third quarter 2003. Excluding mortgage banking fee income, noninterest income increased 9 percent from third quarter 2003. “The increase in fee income in our non-mortgage banking activities reflected improved business conditions and solid year-over-year growth in deposit, loan, credit card and debit card fees and growth in the international, institutional investment and Acordia insurance businesses,” said Atkins. Noninterest income declined $300 million on a linked-quarter basis, due primarily to a decline in mortgage banking fee income and the seasonality of the crop insurance business. During the quarter $48 million of equity investment gains were realized compared with $81 million in second quarter 2004. In line with a relatively flat and sluggish stock market, investment management fees were down from second quarter 2004.

“Credit quality trends remained very solid,” said Chief Credit Officer Dave Munio. “Despite the substantial loan growth we experienced in the last three years, nonperforming assets continued to trend lower and credit losses remained flat.” Third quarter losses were $407 million (.59 percent of loans outstanding, annualized), essentially flat to prior quarter’s $390 million (.59 percent) and declined year-over-year from $424 million (.78 percent). “This was the third consecutive quarter of exceptional results in our Wholesale Banking business units. While we experienced strong consumer loan demand, growth continued to be balanced with our high consumer loan underwriting standards,” said Munio. “Our portfolios continued to demonstrate excellent performance.”

The third quarter provision for credit losses matched net charge-offs, resulting in an essentially unchanged allowance of $3.95 billion at September 30, 2004 from June 30, 2004. Consistent with regulatory guidance, the Company reclassified the part of the allowance for loan losses related to unfunded commercial lending commitments and letters of credit, or $163 million, to other liabilities. “This treatment does not reduce the total valuation reserve for credit losses,” said Munio.

Nonperforming assets of $1.57 billion at September 30, 2004, or .56 percent of total loans, declined from prior quarter by $47 million, or 3 percent. Nonperforming assets in third quarter 2004 were at their lowest level since first quarter 2001. “We believe it is reasonable to expect a modest increase in nonperforming assets as our residential mortgage portfolio seasons and we have a gradual increase in loans in foreclosure,” said Munio.

Community Banking offers a complete line of diversified financial products and services for consumers and small businesses including investment, insurance and trust services primarily in 23 midwestern and western states, and mortgage and home equity loans in all 50 states.

•		Net income up 17 percent from prior year
•		Record core product sales of 3.81 million, up 17 percent from prior year
•		Average loans up 30 percent from prior year

◦		Average consumer loans up 36 percent
◦		Average commercial and commercial real estate up 9 percent

•

Average core deposits up 4 percent from prior year

◦		Up 11 percent excluding mortgage escrows
◦		Up 8 percent (annualized) from prior quarter excluding mortgage escrows

•		Retail bankers increased 1,700, or 17 percent, from prior year
•		Banker productivity of 5.13 core sales per day

•		Agreed to acquire Houston-based First Community Capital Corporation
•		Internet:

◦		5.9 million active online customers, up 29 percent from prior year
◦		49 percent of consumer checking accounts are online
◦		2.1 million bill pay and presentment customers, up 38 percent from prior year
◦		Over 500,000 online small business customers, up 33 percent from prior year
◦		*Global Finance* ranked Wells Fargo best U.S. consumer internet bank
◦		Products sold online vs. prior year:

▪		Consumer product sales up 47 percent
▪		Student loans up 157 percent
▪		Savings accounts doubled

Community Banking reported net income of $1,246 million in third quarter 2004, compared with $1,065 million for the same period of 2003, up 17 percent. Net interest income increased by $183 million, compared with third quarter 2003, due primarily to growth in consumer and 1-4 family loans and deposits, partially offset by a decrease in mortgages held for sale. Noninterest income decreased by $300 million compared with third quarter 2003 due primarily to a decline in mortgage origination volumes. Noninterest expense decreased by $460 million in third quarter 2004, or 13 percent, compared with the same period of 2003, due primarily to a decline in mortgage origination volumes.

“Our experienced and dedicated sales team achieved the highest quarterly sales in our history with 3.81 million core sales for the third quarter, up 17 percent from the same period last year. For the first time, we have exceeded one million core sales each month during the year,” said John Stumpf, Group EVP, Community Banking. “The number of retail bankers increased by 1,700, up 17 percent from last September, while we maintained our strong sales efficiency at 5.13 core sales per platform banker per day. Private Banking, serving our most affluent customers’ needs, has enjoyed outstanding growth this year.” For Private Banking, average core deposits grew by 46 percent in third quarter 2004, compared with a year ago, while loans grew 20 percent over the same period.

“The advantage of Wells Fargo’s multi-channel, anytime, anywhere sales approach is reflected in the growth of the home equity portfolio, which is up 43 percent from prior year to $46 billion dollars,” said Mark Oman, Group EVP, Home and Consumer Finance.

“The mortgage market is transitioning from a refinance market to a purchase market as the refinancing wave ebbs. As a result of reduced refinancing activity, mortgage originations for the quarter were $68 billion, a decrease of $28 billion from the second quarter. Home mortgage applications declined to $83 billion, down $17 billion from the prior quarter. The application pipeline of $55 billion at September 30, 2004 was down 4 percent from June 30, 2004.”

The owned servicing portfolio, including commercial servicing, grew to $777 billion with an average note rate of 5.75 percent.

Wholesale Banking provides businesses across the United States predominantly with annual sales in excess of $10 million with a complete line of commercial, corporate, treasury management, investment, insurance, capital markets and real estate banking products and services.

•		Year-to-date net income up 13 percent from prior year
•		Average loans up 12 percent (annualized) from prior quarter
•		Active users on *CEO^®* portal increased 42 percent from prior year
•		Three former Cooke & Bieler Funds became part of the *Wells Fargo Funds^® family*

Wholesale Banking reported net income of $363 million in third quarter 2004, compared with $372 million in third quarter 2003. The decline reflected a lower net interest margin and an 8 percent increase in noninterest expense primarily due to higher personnel costs. For the first nine months of 2004, net income was $1,196 million, compared with $1,063 million for the first nine months of 2003, a 13 percent increase. The 2004 year-to-date results benefited from continued strength in asset-based lending and improved credit quality.

“We’re pleased to see third quarter commercial loan growth of 12 percent annualized from prior quarter. Credit quality has been particularly strong, resulting in lower credit losses of $51 million year-to-date compared with $154 million year-to-date 2003. All of our team members continue to focus on attracting new customers and providing outstanding solutions,” said Dave Hoyt, Group EVP, Wholesale Banking.

Active users on the Commercial Electronic Office^® (CEO) portal in 2004 increased 42 percent from third quarter 2003. Foreign Exchange Online via the CEO has grown to become a key component of the Company’s international services. Approximately 60 percent of the Company’s foreign exchange transactions are now conducted with this online tool.

The Strong Funds Board of Directors unanimously approved a reorganization of the Strong Funds into Wells Fargo Funds. The closing of the transaction is expected to take place at the end of this year or early next year, pending Strong Funds shareholder approval. “We continue to be very optimistic about the addition of the Strong Funds into the Wells Fargo Funds family and are committed to providing our clients with a broader and deeper mutual fund lineup,” said Hoyt. The three former Cooke & Bieler Funds became part of the Wells Fargo Funds family this quarter. Through a sub-advisory agreement with Wells Fargo Funds Management, Cooke & Bieler continues to manage the investments in the Wells Fargo C&B Funds.

Wells Fargo Financial offers consumer installment and home equity lending, automobile financing, consumer and private-label credit cards and commercial services to consumers and businesses in 48 states, Canada, Mexico, the Caribbean and the Pacific Islands.

•		Record net income up 13 percent from prior year
•		Average loans up 45 percent from prior year
•		Sound credit quality – lower delinquencies and loan loss rates
•		Increased team members by 16 percent from a year ago

“Third-quarter receivables growth continued at a strong pace with average loans of $30.7 billion up 45 percent compared with third quarter 2003,” said Tom Shippee, president and CEO of Wells Fargo Financial. “This growth reflects our continued success in being able to provide products that help our customers achieve their personal financial goals. We’ve been able to grow our loans while maintaining sound credit quality. Delinquencies and loss rates both declined year-over-year reflecting changes in our customer and loan mix.”

The following appears in accordance with the Private Securities Litigation Reform Act of 1995:

This news release contains forward-looking statements about the Company. Forward-looking statements consist of descriptions of plans or objectives for future operations, products or services, forecasts of revenues, earnings or other measures of economic performance, and assumptions underlying or relating to any of the foregoing. Because forward-looking statements discuss future events or conditions and not historical facts, they often include words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “project,” “target,” “can,” “could,” “may,” “should,” “will,” “would” or similar expressions. Examples of forward-looking statements in this release include statements about future credit losses and credit quality, and the expected timeframe for the Strong Funds acquisition.

Do not unduly rely on forward-looking statements. They give the Company’s expectations about the future and are not guarantees. Forward-looking statements speak only as

of the date they are made, and the Company does not undertake to update them to reflect changes that occur after that date.

There are several factors—many beyond the Company’s control—that could cause results to differ significantly from the Company’s expectations. Factors such as credit, market, operational, liquidity, interest rate and other risks are described in the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2004 and Annual Report on Form 10-K for the year ended December 31, 2003, including information incorporated into the Form 10-K from the Company’s 2003 Annual Report to Stockholders, filed as Exhibit 13 to the Form 10-K. See, for example, “Financial Review—Risk Management” included in the 2003 Annual Report to Stockholders and incorporated by reference into the Form 10-K.

Other factors described in the Form 10-Q and Form 10-K include · business and economic conditions · fiscal and monetary policies · legislation and regulation · disintermediation · competition generally and in light of the Gramm-Leach-Bliley Act · potential dividend restrictions · market acceptance and regulatory approval of new products and services · non-banking activities · reliance on other companies for infrastructure components · integration of acquired companies · attracting and retaining key personnel · stock price volatility. See, for example, “Factors That May Affect Future Results” in the June 30, 2004 Form 10-Q.

Any factor described in this news release or in any document referred to in this news release, could, by itself or together with one or more other factors, adversely affect the Company’s business, earnings and/or financial condition.

Wells Fargo & Company is a diversified financial services company with $422 billion in assets, providing banking, insurance, investments, mortgage and consumer finance to more than 23 million customers from more than 6,000 stores, the internet (wellsfargo.com) and other distribution channels across North America and elsewhere internationally.



	Quarter										Nine months
	ended Sept. 30					,	%				ended Sept. 30					,	%
(in millions, except per share amounts)	2004			2003				Change			2004			2003			Change

For the Period
Net income	$	1,748		$	1,561				12	%	$	5,229		$	4,578			14	%
Diluted earnings per common share		1.02			.92				11			3.05			2.70			13
Profitability ratios (annualized)
Net income to average total assets (ROA)		1.66	%		1.57	%			6			1.72	%		1.63	%		6
Net income applicable to common stock to average common stockholders’ equity (ROE)		19.34			18.88				2			19.74			19.42			2
Efficiency ratio (1)		57.7			62.4				(8	)		57.6			60.6			(5	)
Total revenue	$	7,318		$	7,333				—		$	21,891		$	20,946			5
Dividends declared per common share		.48			.45				7			1.38			1.05			31
Average common shares outstanding		1,688.9			1,677.2				1			1,692.1			1,678.0			1
Diluted average common shares outstanding		1,708.7			1,693.9				1			1,712.7			1,692.6			1
Average loans	$	274,255		$	216,181				27		$	265,676		$	205,431			29
Average assets		419,636			394,995				6			405,649			375,209			8
Average core deposits (2)		225,027			215,685				4			221,046			206,041			7
Net interest margin		4.89	%		5.01	%			(2	)		4.89	%		5.12	%		(4	)
At Period End
Securities available for sale	$	35,121		$	30,260				16		$	35,121		$	30,260			16
Loans		279,310			228,137				22			279,310			228,137			22
Allowance for loan losses		3,782			3,854				(2	)		3,782			3,854			(2	)
Goodwill		10,431			9,849				6			10,431			9,849			6
Assets		421,549			390,750				8			421,549			390,750			8
Core deposits		224,946			209,422				7			224,946			209,422			7
Stockholders’ equity		36,680			32,333				13			36,680			32,333			13
Capital ratios
Stockholders’ equity to assets		8.70	%		8.27	%			5			8.70	%		8.27	%		5
Risk-based capital (3)
Tier 1 capital		8.40			8.14				3			8.40			8.14			3
Total capital		12.14			11.62				4			12.14			11.62			4
Tier 1 leverage (3)		6.97			6.43				8			6.97			6.43			8
Book value per common share	$	21.71		$	19.25				13		$	21.71		$	19.25			13
Team members (active, full-time equivalent)		143,700			139,200				3			143,700			139,200			3
Common Stock Price
High	$	59.86		$	53.71				11		$	59.86		$	53.71			11
Low		56.12			48.90				15			54.32			43.27			26
Period end		59.63			51.50				16			59.63			51.50			16



	Quarter ended
	Sept. 30		,	June 30		,	Mar. 31		,	Dec. 31		,	Sept. 30		,
(in millions, except per share amounts)	2004			2004			2004			2003			2003

For the Quarter
Net income	$	1,748		$	1,714		$	1,767		$	1,624		$	1,561
Diluted earnings per common share		1.02			1.00			1.03			.95			.92
Profitability ratios (annualized)
Net income to average total assets (ROA)		1.66	%		1.68	%		1.84	%		1.67	%		1.57	%
Net income applicable to common stock to average common stockholders’ equity (ROE)		19.34			19.57			20.31			19.20			18.88
Efficiency ratio (1)		57.7			58.6			56.4			60.5			62.4
Total revenue	$	7,318		$	7,426		$	7,147		$	7,445		$	7,333
Dividends declared per common share		.48			.45			.45			.45			.45
Average common shares outstanding		1,688.9			1,688.1			1,699.3			1,690.2			1,677.2
Diluted average common shares outstanding		1,708.7			1,708.3			1,721.2			1,712.6			1,693.9
Average loans	$	274,255		$	266,231		$	256,448		$	235,986		$	216,181
Average assets		419,636			410,544			386,614			384,744			394,995
Average core deposits (2)		225,027			224,920			213,146			210,026			215,685
Net interest margin		4.89	%		4.83	%		4.94	%		4.97	%		5.01	%
At Quarter End
Securities available for sale	$	35,121		$	36,771		$	32,857		$	32,953		$	30,260
Loans		279,310			269,731			264,216			253,073			228,137
Allowance for loan losses		3,782			3,940			3,891			3,891			3,854
Goodwill		10,431			10,430			10,403			10,371			9,849
Assets		421,549			420,305			397,354			387,798			390,750
Core deposits		224,946			222,166			220,105			211,271			209,422
Stockholders’ equity		36,680			35,478			35,442			34,469			32,333
Capital ratios
Stockholders’ equity to assets		8.70	%		8.44	%		8.92	%		8.89	%		8.27	%
Risk-based capital (3)
Tier 1 capital		8.40			8.24			8.48			8.42			8.14
Total capital		12.14			11.86			12.18			12.21			11.62
Tier 1 leverage (3)		6.97			6.84			7.13			6.93			6.43
Book value per common share	$	21.71		$	21.03		$	20.90		$	20.31		$	19.25
Team members (active, full-time equivalent)		143,700			142,600			139,900			140,000			139,200
Common Stock Price
High	$	59.86		$	59.72		$	58.98		$	59.18		$	53.71
Low		56.12			54.32			55.97			51.68			48.90
Period end		59.63			57.23			56.67			58.89			51.50



	Quarter ended Sept. 30				,	%			Nine months ended Sept. 30					,	%
(in millions, except per share amounts)	2004		2003			Change			2004			2003			Change

INTEREST INCOME
Securities available for sale	$	496	$	470			6	%	$	1,398		$	1,358			3	%
Mortgages held for sale		490		906			(46	)		1,294			2,585			(50	)
Loans held for sale		76		57			33			205			191			7
Loans		4,271		3,482			23			12,239			10,224			20
Other interest income		72		64			13			196			205			(4	)

Total interest income		5,405		4,979			9			15,332			14,563			5

INTEREST EXPENSE
Deposits		487		384			27			1,251			1,236			1
Short-term borrowings		105		72			46			227			254			(11	)
Long-term debt		395		349			13			1,160			1,020			14
Guaranteed preferred beneficial interests in Company’s subordinated debentures		—		32			(100	)		—			88			(100	)

Total interest expense		987		837			18			2,638			2,598			2

NET INTEREST INCOME		4,418		4,142			7			12,694			11,965			6
Provision for credit losses		408		426			(4	)		1,252			1,258			—

Net interest income after provision for credit losses		4,010		3,716			8			11,442			10,707			7

NONINTEREST INCOME
Service charges on deposit accounts		644		607			6			1,896			1,747			9
Trust and investment fees		508		504			1			1,573			1,433			10
Credit card fees		290		251			16			827			752			10
Other fees		456		422			8			1,310			1,161			13
Mortgage banking		262		773			(66	)		1,070			1,877			(43	)
Operating leases		207		229			(10	)		625			726			(14	)
Insurance		264		252			5			928			807			15
Net gains (losses) on debt securities available for sale		10		(23	)		—			(18	)		16			—
Net gains (losses) from equity investments		48		58			(17	)		224			(87	)		—
Other		211		118			79			762			549			39

Total noninterest income		2,900		3,191			(9	)		9,197			8,981			2

NONINTEREST EXPENSE
Salaries		1,383		1,185			17			3,955			3,481			14
Incentive compensation		449		621			(28	)		1,281			1,571			(18	)
Employee benefits		390		374			4			1,273			1,143			11
Equipment		254		298			(15	)		826			871			(5	)
Net occupancy		309		283			9			907			867			5
Operating leases		158		175			(10	)		469			541			(13	)
Other		1,277		1,639			(22	)		3,891			4,216			(8	)

Total noninterest expense		4,220		4,575			(8	)		12,602			12,690			(1	)

INCOME BEFORE INCOME TAX EXPENSE		2,690		2,332			15			8,037			6,998			15
Income tax expense		942		771			22			2,808			2,420			16

NET INCOME	$	1,748	$	1,561			12	%	$	5,229		$	4,578			14	%

NET INCOME APPLICABLE TO COMMON STOCK	$	1,748	$	1,560			12	%	$	5,229		$	4,575			14	%

EARNINGS PER COMMON SHARE	$	1.03	$	.93			11	%	$	3.09		$	2.73			13	%

DILUTED EARNINGS PER COMMON SHARE	$	1.02	$	.92			11	%	$	3.05		$	2.70			13	%

DIVIDENDS DECLARED PER COMMON SHARE	$	.48	$	.45			7	%	$	1.38		$	1.05			31	%

Average common shares outstanding		1,688.9		1,677.2			1	%		1,692.1			1,678.0			1	%

Diluted average common shares outstanding		1,708.7		1,693.9			1	%		1,712.7			1,692.6			1	%



	Quarter ended
	Sept. 30		,	June 30		,	Mar. 31		,	Dec. 31		,	Sept. 30		,
(in millions, except per share amounts)	2004			2004			2004			2003			2003

INTEREST INCOME
Securities available for sale	$	496		$	457		$	445		$	458		$	470
Mortgages held for sale		490			470			334			551			906
Loans held for sale		76			66			63			60			57
Loans		4,271			4,011			3,957			3,713			3,482
Other interest income		72			65			59			74			64

Total interest income		5,405			5,069			4,858			4,856			4,979

INTEREST EXPENSE
Deposits		487			394			370			377			384
Short-term borrowings		105			59			63			68			72
Long-term debt		395			390			375			335			349
Guaranteed preferred beneficial interests in Company’s subordinated debentures		—			—			—			32			32

Total interest expense		987			843			808			812			837

NET INTEREST INCOME		4,418			4,226			4,050			4,044			4,142
Provision for credit losses		408			440			404			465			426

Net interest income after provision for credit losses		4,010			3,786			3,646			3,579			3,716

NONINTEREST INCOME
Service charges on deposit accounts		644			637			615			613			607
Trust and investment fees		508			530			535			504			504
Credit card fees		290			279			258			252			251
Other fees		456			440			414			412			422
Mortgage banking		262			493			315			636			773
Operating leases		207			209			209			211			229
Insurance		264			347			317			264			252
Net gains (losses) on debt securities available for sale		10			(61	)		33			(12	)		(23	)
Net gains from equity investments		48			81			95			143			58
Other		211			245			306			378			118

Total noninterest income		2,900			3,200			3,097			3,401			3,191

NONINTEREST EXPENSE
Salaries		1,383			1,295			1,277			1,351			1,185
Incentive compensation		449			441			391			483			621
Employee benefits		390			391			492			417			374
Equipment		254			271			301			375			298
Net occupancy		309			304			294			310			283
Operating leases		158			156			155			162			175
Other		1,277			1,495			1,119			1,402			1,639

Total noninterest expense		4,220			4,353			4,029			4,500			4,575

INCOME BEFORE INCOME TAX EXPENSE		2,690			2,633			2,714			2,480			2,332
Income tax expense		942			919			947			856			771

NET INCOME	$	1,748		$	1,714		$	1,767		$	1,624		$	1,561

NET INCOME APPLICABLE TO COMMON STOCK	$	1,748		$	1,714		$	1,767		$	1,624		$	1,560

EARNINGS PER COMMON SHARE	$	1.03		$	1.02		$	1.04		$	.96		$	.93

DILUTED EARNINGS PER COMMON SHARE	$	1.02		$	1.00		$	1.03		$	.95		$	.92

DIVIDENDS DECLARED PER COMMON SHARE	$	.48		$	.45		$	.45		$	.45		$	.45

Average common shares outstanding		1,688.9			1,688.1			1,699.3			1,690.2			1,677.2

Diluted average common shares outstanding		1,708.7			1,708.3			1,721.2			1,712.6			1,693.9



										% Change
										Sept. 30, 2004 from
	Sept. 30		,	Dec. 31		,	Sept. 30		,	Dec. 31		,	Sept. 30		,
(in millions, except shares)	2004			2003			2003			2003			2003

ASSETS
Cash and due from banks	$	13,249		$	15,547		$	15,423			(15	)%		(14	)%
Federal funds sold and securities purchased under resale agreements		3,869			2,745			2,692			41			44
Securities available for sale		35,121			32,953			30,260			7			16
Mortgages held for sale		30,783			29,027			55,328			6			(44	)
Loans held for sale		8,434			7,497			7,310			12			15
Loans		279,310			253,073			228,137			10			22
Allowance for loan losses		(3,782	)		(3,891	)		(3,854	)		(3	)		(2	)

Net loans		275,528			249,182			224,283			11			23

Mortgage servicing rights, net		7,768			6,906			5,765			12			35
Premises and equipment, net		3,722			3,534			3,517			5			6
Goodwill		10,431			10,371			9,849			1			6
Other assets		32,644			30,036			36,323			9			(10	)

Total assets	$	421,549		$	387,798		$	390,750			9	%		8	%

LIABILITIES
Noninterest-bearing deposits	$	79,090		$	74,387		$	77,175			6	%		2	%
Interest-bearing deposits		189,697			173,140			174,261			10			9

Total deposits		268,787			247,527			251,436			9			7
Short-term borrowings		24,278			24,659			25,589			(2	)		(5	)
Accrued expenses and other liabilities		20,484			17,501			18,815			17			9
Long-term debt		71,320			63,642			58,992			12			21
Guaranteed preferred beneficial interests in Company’s subordinated debentures		—			—			3,585			—			(100	)

Total liabilities		384,869			353,329			358,417			9			7

STOCKHOLDERS’ EQUITY
Preferred stock		325			214			319			52			2
Common stock - $1-2/3 par value, authorized 6,000,000,000 shares; issued 1,736,381,025 shares		2,894			2,894			2,894			—			—
Additional paid-in capital		9,767			9,643			9,532			1			2
Retained earnings		25,564			22,842			22,064			12			16
Cumulative other comprehensive income		914			938			572			(3	)		60
Treasury stock - 46,042,180 shares, 38,271,651 shares and 59,314,051 shares		(2,436	)		(1,833	)		(2,785	)		33			(13	)
Unearned ESOP shares		(348	)		(229	)		(263	)		52			32

Total stockholders’ equity		36,680			34,469			32,333			6			13

Total liabilities and stockholders’ equity	$	421,549		$	387,798		$	390,750			9	%		8	%

Wells Fargo & Company and Subsidiaries
FIVE QUARTER CONSOLIDATED BALANCE SHEET



	Sept. 30		,	June 30		,	Mar. 31		,	Dec. 31		,	Sept. 30		,
(in millions)	2004			2004			2004			2003			2003

ASSETS
Cash and due from banks	$	13,249		$	13,449		$	13,972		$	15,547		$	15,423
Federal funds sold and securities purchased under resale agreements		3,869			2,681			2,439			2,745			2,692
Securities available for sale		35,121			36,771			32,857			32,953			30,260
Mortgages held for sale		30,783			39,424			26,361			29,027			55,328
Loans held for sale		8,434			8,156			8,037			7,497			7,310

Loans		279,310			269,731			264,216			253,073			228,137
Allowance for loan losses		(3,782	)		(3,940	)		(3,891	)		(3,891	)		(3,854	)

Net loans		275,528			265,791			260,325			249,182			224,283

Mortgage servicing rights, net		7,768			8,512			6,097			6,906			5,765
Premises and equipment, net		3,722			3,627			3,545			3,534			3,517
Goodwill		10,431			10,430			10,403			10,371			9,849
Other assets		32,644			31,464			33,318			30,036			36,323

Total assets	$	421,549		$	420,305		$	397,354		$	387,798		$	390,750

LIABILITIES
Noninterest-bearing deposits	$	79,090		$	78,926		$	78,253		$	74,387		$	77,175
Interest-bearing deposits		189,697			189,199			170,116			173,140			174,261

Total deposits		268,787			268,125			248,369			247,527			251,436
Short-term borrowings		24,278			29,831			20,397			24,659			25,589
Accrued expenses and other liabilities		20,484			21,266			19,756			17,501			18,815
Long-term debt		71,320			65,605			73,390			63,642			58,992
Guaranteed preferred beneficial interests in Company’s subordinated debentures		—			—			—			—			3,585

Total liabilities		384,869			384,827			361,912			353,329			358,417

STOCKHOLDERS’ EQUITY
Preferred stock		325			387			452			214			319
Common stock		2,894			2,894			2,894			2,894			2,894
Additional paid-in capital		9,767			9,744			9,711			9,643			9,532
Retained earnings		25,564			24,669			23,796			22,842			22,064
Cumulative other comprehensive income		914			735			1,057			938			572
Treasury stock		(2,436	)		(2,537	)		(1,984	)		(1,833	)		(2,785	)
Unearned ESOP shares		(348	)		(414	)		(484	)		(229	)		(263	)

Total stockholders’ equity		36,680			35,478			35,442			34,469			32,333

Total liabilities and stockholders’ equity	$	421,549		$	420,305		$	397,354		$	387,798		$	390,750



	Quarter ended
	Sept. 30		,	June 30		,	Mar. 31		,	Dec. 31		,	Sept. 30		,
(in millions)	2004			2004			2004			2003			2003

EARNING ASSETS
Federal funds sold and securities purchased under resale agreements	$	3,818		$	2,565		$	2,671		$	2,699		$	2,514
Debt securities available for sale:
Securities of U.S. Treasury and federal agencies		1,132			1,190			1,224			1,278			1,283
Securities of U.S. states and political subdivisions		3,586			3,456			3,338			3,141			2,442
Mortgage-backed securities:
Federal agencies		22,965			20,076			20,635			21,149			18,538
Private collateralized mortgage obligations		3,836			4,077			2,713			2,014			1,972

Total mortgage-backed securities		26,801			24,153			23,348			23,163			20,510
Other debt securities (1)		3,443			3,346			3,543			3,478			3,540

Total debt securities available for sale (1)		34,962			32,145			31,453			31,060			27,775
Mortgages held for sale		34,844			36,782			25,023			41,055			69,786
Loans held for sale		8,276			8,074			7,911			7,373			7,124
Loans:
Commercial and commercial real estate:
Commercial		49,517			48,711			47,305			47,674			46,947
Other real estate mortgage		29,025			28,586			27,801			26,691			25,635
Real estate construction		8,949			8,428			8,264			8,151			7,775
Lease financing		5,084			5,027			5,053			4,508			4,497

Total commercial and commercial real estate		92,575			90,752			88,423			87,024			84,854
Consumer:
Real estate 1-4 family first mortgage		88,689			89,351			86,375			71,402			57,817
Real estate 1-4 family junior lien mortgage		46,367			41,964			38,328			35,152			32,512
Credit card		8,948			8,508			8,338			8,013			7,683
Other revolving credit and installment		34,168			32,975			32,477			31,975			31,053

Total consumer		178,172			172,798			165,518			146,542			129,065
Foreign		3,508			2,681			2,507			2,420			2,262

Total loans (2)		274,255			266,231			256,448			235,986			216,181
Other		7,598			8,095			8,538			9,169			8,905

Total earning assets	$	363,753		$	353,892		$	332,044		$	327,342		$	332,285

FUNDING SOURCES
Deposits:
Interest-bearing checking	$	3,017		$	3,011		$	2,962		$	2,744		$	2,592
Market rate and other savings		124,090			121,647			117,373			112,392			108,969
Savings certificates		18,490			18,724			19,495			19,949			20,429
Other time deposits		36,089			29,654			22,719			26,382			27,633
Deposits in foreign offices		8,856			9,306			7,171			5,992			5,643

Total interest-bearing deposits		190,542			182,342			169,720			167,459			165,266
Short-term borrowings		29,840			22,689			25,630			28,367			29,572
Long-term debt		65,443			71,085			64,416			58,814			57,960
Guaranteed preferred beneficial interests in Company’s subordinated debentures		—			—			—			3,591			3,525

Total interest-bearing liabilities		285,825			276,116			259,766			258,231			256,323
Portion of noninterest-bearing funding sources		77,928			77,776			72,278			69,111			75,962

Total funding sources	$	363,753		$	353,892		$	332,044		$	327,342		$	332,285

NONINTEREST-EARNING ASSETS
Cash and due from banks	$	12,704		$	12,997		$	13,152		$	13,083		$	13,642
Goodwill		10,431			10,413			10,394			10,209			9,817
Other		32,748			33,242			31,024			34,110			39,251

Total noninterest-earning assets	$	55,883		$	56,652		$	54,570		$	57,402		$	62,710

NONINTEREST-BEARING FUNDING SOURCES
Deposits	$	79,430		$	81,538		$	73,316		$	74,941		$	83,695
Other liabilities		18,435			17,700			18,572			18,000			22,139
Stockholders’ equity		35,946			35,190			34,960			33,572			32,838
Noninterest-bearing funding sources used to fund earning assets		(77,928	)		(77,776	)		(72,278	)		(69,111	)		(75,962	)

Net noninterest-bearing funding sources	$	55,883		$	56,652		$	54,570		$	57,402		$	62,710

TOTAL ASSETS	$	419,636		$	410,544		$	386,614		$	384,744		$	394,995

Wells Fargo & Company and Subsidiaries
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY



	Sept. 30		,	June 30		,	Mar. 31		,	Dec. 31		,	Sept. 30		,
(in millions)	2004			2004			2004			2003			2003

Commercial and commercial real estate:
Commercial	$	50,750		$	49,962		$	48,034		$	48,729		$	47,720
Other real estate mortgage		29,406			28,975			28,323			27,592			25,723
Real estate construction		9,211			8,646			8,259			8,209			7,777
Lease financing		5,075			5,045			5,018			4,477			4,478

Total commercial and commercial real estate		94,442			92,628			89,634			89,007			85,698
Consumer:
Real estate 1-4 family first mortgage		87,587			87,776			90,563			83,535			66,760
Real estate 1-4 family junior lien mortgage		49,557			44,289			40,281			36,629			33,601
Credit card		9,439			8,692			8,357			8,351			7,836
Other revolving credit and installment		34,435			33,458			32,755			33,100			31,919

Total consumer		181,018			174,215			171,956			161,615			140,116
Foreign		3,850			2,888			2,626			2,451			2,323

Total loans (net of unearned income)	$	279,310		$	269,731		$	264,216		$	253,073		$	228,137



	Sept. 30		,	June 30		,	Mar. 31		,	Dec. 31		,	Sept. 30		,
(in millions)	2004			2004			2004			2003			2003

Nonaccrual loans:
Commercial and commercial real estate:
Commercial	$	382		$	422		$	514		$	592		$	713
Other real estate mortgage		258			324			263			285			267
Real estate construction		59			72			71			56			48
Lease financing		54			55			74			73			71

Total commercial and commercial real estate		753			873			922			1,006			1,099
Consumer:
Real estate 1-4 family first mortgage		360			317			281			274			258
Real estate 1-4 family junior lien mortgage		93			86			96			87			79
Other revolving credit and installment		155			97			85			88			78

Total consumer		608			500			462			449			415
Foreign		16			6			3			3			3

Total nonaccrual loans		1,377			1,379			1,387			1,458			1,517
As a percentage of total loans		.49	%		.51	%		.52	%		.58	%		.66	%
Foreclosed assets		190			235			222			198			196
Real estate investments		2			2			2			6			6

Total nonaccrual loans and other assets	$	1,569		$	1,616		$	1,611		$	1,662		$	1,719

As a percentage of total loans		.56	%		.60	%		.61	%		.66	%		.75	%

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



	Quarter ended									Nine months ended
	Sept. 30		,	June 30		,	Sept. 30		,	Sept. 30		,	Sept. 30		,
(in millions)	2004			2004			2003			2004			2003

Balance, beginning of period	$	3,940		$	3,891		$	3,853		$	3,891		$	3,819
Allowances related to business combinations/other		4			(1	)		(1	)		3			31
Provision for credit losses		408			440			426			1,252			1,258
Loan charge-offs:
Commercial and commercial real estate:
Commercial		(98	)		(112	)		(136	)		(321	)		(437	)
Other real estate mortgage		(4	)		(7	)		(12	)		(18	)		(23	)
Real estate construction		(1	)		—			(2	)		(4	)		(8	)
Lease financing		(24	)		(12	)		(12	)		(48	)		(33	)

Total commercial and commercial real estate		(127	)		(131	)		(162	)		(391	)		(501	)
Consumer:
Real estate 1-4 family first mortgage		(14	)		(11	)		(11	)		(38	)		(31	)
Real estate 1-4 family junior lien mortgage		(20	)		(27	)		(16	)		(76	)		(54	)
Credit card		(109	)		(119	)		(109	)		(337	)		(337	)
Other revolving credit and installment		(233	)		(212	)		(206	)		(669	)		(602	)

Total consumer		(376	)		(369	)		(342	)		(1,120	)		(1,024	)
Foreign		(37	)		(30	)		(29	)		(95	)		(74	)

Total loan charge-offs		(540	)		(530	)		(533	)		(1,606	)		(1,599	)

Loan recoveries:
Commercial and commercial real estate:
Commercial		31			44			31			117			106
Other real estate mortgage		8			4			2			14			7
Real estate construction		3			1			2			5			11
Lease financing		7			6			2			19			5

Total commercial and commercial real estate		49			55			37			155			129
Consumer:
Real estate 1-4 family first mortgage		1			2			3			4			8
Real estate 1-4 family junior lien mortgage		6			7			5			17			12
Credit card		15			15			13			45			38
Other revolving credit and installment		56			55			46			167			145

Total consumer		78			79			67			233			203
Foreign		6			6			5			17			13

Total loan recoveries		133			140			109			405			345

Net loan charge-offs		(407	)		(390	)		(424	)		(1,201	)		(1,254	)

Balance, end of period	$	3,945		$	3,940		$	3,854		$	3,945		$	3,854

Components:
Allowance for loan losses	$	3,782		$	3,940		$	3,854		$	3,782		$	3,854
Reserve for unfunded credit commitments (1)		163			—			—			163			—

Allowance for credit losses	$	3,945		$	3,940		$	3,854		$	3,945		$	3,854

Net loan charge-offs (annualized) as a percentage of average total loans		.59	%		.59	%		.78	%		.60	%		.82	%

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



	Quarter ended
	Sept. 30		,	June 30		,	Mar. 31		,	Dec. 31		,	Sept. 30		,
(in millions)	2004			2004			2004			2003			2003

Balance, beginning of quarter	$	3,940		$	3,891		$	3,891		$	3,854		$	3,853
Allowances related to business combinations/other		4			(1	)		—			37			(1	)
Provision for credit losses		408			440			404			465			426
Loan charge-offs:
Commercial and commercial real estate:
Commercial		(98	)		(112	)		(111	)		(161	)		(136	)
Other real estate mortgage		(4	)		(7	)		(7	)		(10	)		(12	)
Real estate construction		(1	)		—			(3	)		(3	)		(2	)
Lease financing		(24	)		(12	)		(12	)		(10	)		(12	)

Total commercial and commercial real estate		(127	)		(131	)		(133	)		(184	)		(162	)
Consumer:
Real estate 1-4 family first mortgage		(14	)		(11	)		(13	)		(15	)		(11	)
Real estate 1-4 family junior lien mortgage		(20	)		(27	)		(29	)		(23	)		(16	)
Credit card		(109	)		(119	)		(109	)		(139	)		(109	)
Other revolving credit and installment		(233	)		(212	)		(224	)		(224	)		(206	)

Total consumer		(376	)		(369	)		(375	)		(401	)		(342	)
Foreign		(37	)		(30	)		(28	)		(30	)		(29	)

Total loan charge-offs		(540	)		(530	)		(536	)		(615	)		(533	)

Loan recoveries:
Commercial and commercial real estate:
Commercial		31			44			42			72			31
Other real estate mortgage		8			4			2			4			2
Real estate construction		3			1			1			1			2
Lease financing		7			6			6			2			2

Total commercial and commercial real estate		49			55			51			79			37
Consumer:
Real estate 1-4 family first mortgage		1			2			1			1			3
Real estate 1-4 family junior lien mortgage		6			7			4			1			5
Credit card		15			15			15			13			13
Other revolving credit and installment		56			55			56			51			46

Total consumer		78			79			76			66			67
Foreign		6			6			5			5			5

Total loan recoveries		133			140			132			150			109

Net loan charge-offs		(407	)		(390	)		(404	)		(465	)		(424	)

Balance, end of quarter	$	3,945		$	3,940		$	3,891		$	3,891		$	3,854

Components:
Allowance for loan losses	$	3,782		$	3,940		$	3,891		$	3,891		$	3,854
Reserve for unfunded credit commitments (1)		163			—			—			—			—

Allowance for credit losses	$	3,945		$	3,940		$	3,891		$	3,891		$	3,854

Net loan charge-offs (annualized) as a percentage of average total loans		.59	%		.59	%		.63	%		.78	%		.78	%
Allowance for loan losses:
As a percentage of total loans		1.35	%		1.46	%		1.47	%		1.54	%		1.69	%
As a percentage of nonaccrual loans		275			286			281			267			254
As a percentage of nonaccrual loans and other assets		241			244			242			234			224
Allowance for credit losses:
As a percentage of total loans		1.41	%		1.46	%		1.47	%		1.54	%		1.69	%
As a percentage of nonaccrual loans		286			286			281			267			254
As a percentage of nonaccrual loans and other assets		251			244			242			234			224



	Quarter ended Sept. 30					,	%			Nine months ended Sept. 30					,	%
(in millions)	2004			2003			Change			2004			2003			Change

Service charges on deposit accounts	$	644		$	607			6	%	$	1,896		$	1,747			9	%
Trust and investment fees:
Trust, investment and IRA fees		366			348			5			1,124			995			13
Commissions and all other fees		142			156			(9	)		449			438			3

Total trust and investment fees		508			504			1			1,573			1,433			10
Credit card fees		290			251			16			827			752			10
Other fees:
Cash network fees		47			48			(2	)		136			136			—
Charges and fees on loans		236			199			19			671			565			19
All other		173			175			(1	)		503			460			9

Total other fees		456			422			8			1,310			1,161			13
Mortgage banking:
Servicing fees, net of amortization and provision for impairment		(24	)		(82	)		(71	)		603			(1,266	)		—
Net gains on mortgage loan origination/sales activities		212			712			(70	)		258			2,790			(91	)
All other		74			143			(48	)		209			353			(41	)

Total mortgage banking		262			773			(66	)		1,070			1,877			(43	)
Operating leases		207			229			(10	)		625			726			(14	)
Insurance		264			252			5			928			807			15
Net gains (losses) on debt securities available for sale		10			(23	)		—			(18	)		16			—
Net gains (losses) from equity investments		48			58			(17	)		224			(87	)		—
Net gains on sales of loans		3			19			(84	)		7			23			(70	)
Net gains on dispositions of operations		—			—			—			2			27			(93	)
All other		208			99			110			753			499			51

Total	$	2,900		$	3,191			(9	)%	$	9,197		$	8,981			2	%



	Quarter ended Sept. 30				,	%			Nine months ended Sept. 30				,	%
(in millions)	2004		2003			Change			2004		2003			Change

Salaries	$	1,383	$	1,185			17	%	$	3,955	$	3,481			14	%
Incentive compensation		449		621			(28	)		1,281		1,571			(18	)
Employee benefits		390		374			4			1,273		1,143			11
Equipment		254		298			(15	)		826		871			(5	)
Net occupancy		309		283			9			907		867			5
Operating leases		158		175			(10	)		469		541			(13	)
Contract services		154		270			(43	)		454		675			(33	)
Outside professional services		165		122			35			440		345			28
Outside data processing		109		105			4			314		306			3
Advertising and promotion		113		98			15			315		274			15
Travel and entertainment		110		98			12			312		275			13
Telecommunications		73		92			(21	)		216		256			(16	)
Postage		63		94			(33	)		201		265			(24	)
Stationery and supplies		57		62			(8	)		177		173			2
Charitable donations		7		197			(96	)		24		216			(89	)
Insurance		47		48			(2	)		214		166			29
Operating losses		45		29			55			144		149			(3	)
Security		40		41			(2	)		120		125			(4	)
Loss from debt extinguishment		—		—			—			176		—			—
Core deposit intangibles		33		35			(6	)		101		107			(6	)
All other		261		348			(25	)		683		884			(23	)

Total	$	4,220	$	4,575			(8	)%	$	12,602	$	12,690			(1	)%



	Quarter ended
	Sept. 30		,	June 30		,	Mar. 31		,	Dec. 31		,	Sept. 30		,
(in millions)	2004			2004			2004			2003			2003

Service charges on deposit accounts	$	644		$	637		$	615		$	613		$	607
Trust and investment fees:
Trust, investment and IRA fees		366			383			375			350			348
Commissions and all other fees		142			147			160			154			156

Total trust and investment fees		508			530			535			504			504
Credit card fees		290			279			258			252			251
Other fees:
Cash network fees		47			46			43			44			48
Charges and fees on loans		236			224			211			191			199
All other		173			170			160			177			175

Total other fees		456			440			414			412			422
Mortgage banking:
Servicing fees, net of amortization and provision for impairment		(24	)		461			166			312			(82	)
Net gains (losses) on mortgage loan origination/sales activities		212			(52	)		98			229			712
All other		74			84			51			95			143

Total mortgage banking		262			493			315			636			773
Operating leases		207			209			209			211			229
Insurance		264			347			317			264			252
Net gains (losses) on debt securities available for sale		10			(61	)		33			(12	)		(23	)
Net gains from equity investments		48			81			95			143			58
Net gains on sales of loans		3			—			4			5			19
Net gains on dispositions of operations		—			1			1			2			—
All other		208			244			301			371			99

Total	$	2,900		$	3,200		$	3,097		$	3,401		$	3,191



	Quarter ended
	Sept. 30		,	June 30		,	Mar. 31		,	Dec. 31		,	Sept. 30		,
(in millions)	2004			2004			2004			2003			2003

Salaries	$	1,383		$	1,295		$	1,277		$	1,351		$	1,185
Incentive compensation		449			441			391			483			621
Employee benefits		390			391			492			417			374
Equipment		254			271			301			375			298
Net occupancy		309			304			294			310			283
Operating leases		158			156			155			162			175
Contract services		154			157			143			191			270
Outside professional services		165			156			119			164			122
Outside data processing		109			106			99			98			105
Advertising and promotion		113			118			84			118			98
Travel and entertainment		110			105			97			114			98
Telecommunications		73			62			81			87			92
Postage		63			63			75			71			94
Stationery and supplies		57			60			60			68			62
Charitable donations		7			10			7			21			197
Insurance		47			96			71			31			48
Operating losses		45			82			17			44			29
Security		40			40			40			38			41
Loss from debt extinguishment		—			176			—			—			—
Core deposit intangibles		33			34			34			35			35
All other		261			230			192			322			348

Total	$	4,220		$	4,353		$	4,029		$	4,500		$	4,575

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



	Quarter ended Sept. 30																,
	2004								2003
							Interest								Interest
	Average			Yields/			income/		Average			Yields/			income/
(in millions)	balance			rates			expense		balance			rates			expense


EARNING ASSETS
Federal funds sold and securities purchased under resale agreements	$	3,818			1.37	%	$	14	$	2,514			.88	%	$	6
Debt securities available for sale (3):
Securities of U.S. Treasury and federal agencies		1,132			4.39			12		1,283			4.59			14
Securities of U.S. states and political subdivisions		3,586			7.85			67		2,442			8.92			51
Mortgage-backed securities:
Federal agencies		22,965			6.02			335		18,538			7.50			334
Private collateralized mortgage obligations		3,836			5.12			48		1,972			5.25			25

Total mortgage-backed securities		26,801			5.89			383		20,510			7.28			359
Other debt securities (4)		3,443			7.60			58		3,540			7.89			64

Total debt securities available for sale (4)		34,962			6.19			520		27,775			7.37			488
Mortgages held for sale (3)		34,844			5.61			490		69,786			5.18			906
Loans held for sale (3)		8,276			3.68			76		7,124			3.17			57
Loans:
Commercial and commercial real estate:
Commercial		49,517			5.61			698		46,947			6.04			714
Other real estate mortgage		29,025			5.37			391		25,635			5.33			343
Real estate construction		8,949			5.29			119		7,775			4.98			98
Lease financing		5,084			6.23			79		4,497			6.27			70

Total commercial and commercial real estate		92,575			5.53			1,287		84,854			5.74			1,225
Consumer:
Real estate 1-4 family first mortgage		88,689			5.54			1,231		57,817			5.31			770
Real estate 1-4 family junior lien mortgage		46,367			5.07			591		32,512			5.69			466
Credit card		8,948			12.00			269		7,683			12.11			233
Other revolving credit and installment		34,168			8.99			771		31,053			8.81			689

Total consumer		178,172			6.40			2,862		129,065			6.65			2,158
Foreign		3,508			14.24			124		2,262			18.01			102

Total loans (5)		274,255			6.21			4,273		216,181			6.41			3,485
Other		7,598			3.09			59		8,905			2.60			58

Total earning assets	$	363,753			5.97			5,432	$	332,285			6.02			5,000


FUNDING SOURCES
Deposits:
Interest-bearing checking	$	3,017			.47			4	$	2,592			.20			1
Market rate and other savings		124,090			.68			213		108,969			.61			166
Savings certificates		18,490			2.24			105		20,429			2.43			125
Other time deposits		36,089			1.47			133		27,633			1.11			78
Deposits in foreign offices		8,856			1.44			32		5,643			1.00			14

Total interest-bearing deposits		190,542			1.02			487		165,266			.92			384
Short-term borrowings		29,840			1.41			105		29,572			.96			72
Long-term debt		65,443			2.41			395		57,960			2.40			349
Guaranteed preferred beneficial interests in Company’s subordinated debentures		—			—			—		3,525			3.64			32

Total interest-bearing liabilities		285,825			1.38			987		256,323			1.30			837
Portion of noninterest-bearing funding sources		77,928			—			—		75,962			—			—

Total funding sources	$	363,753			1.08			987	$	332,285			1.01			837

Net interest margin and net interest income on a taxable-equivalent basis (6)					4.89	%	$	4,445					5.01	%	$	4,163


NONINTEREST-EARNING ASSETS
Cash and due from banks	$	12,704							$	13,642
Goodwill		10,431								9,817
Other		32,748								39,251

Total noninterest-earning assets	$	55,883							$	62,710


NONINTEREST-BEARING FUNDING SOURCES
Deposits	$	79,430							$	83,695
Other liabilities		18,435								22,139
Stockholders’ equity		35,946								32,838
Noninterest-bearing funding sources used to fund earning assets		(77,928	)							(75,962	)

Net noninterest-bearing funding sources	$	55,883							$	62,710


TOTAL ASSETS	$	419,636							$	394,995

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



	Nine months ended Sept. 30																,
	2004								2003
							Interest								Interest
	Average			Yields/			income/		Average			Yields/			income/
(in millions)	balance			rates			expense		balance			rates			expense


EARNING ASSETS
Federal funds sold and securities purchased under resale agreements	$	3,021			1.13	%	$	26	$	4,005			1.16	%	$	35
Debt securities available for sale (3):
Securities of U.S. Treasury and federal agencies		1,182			4.16			36		1,288			4.85			45
Securities of U.S. states and political subdivisions		3,460			7.90			196		2,183			8.92			136
Mortgage-backed securities:
Federal agencies		21,232			6.02			927		17,317			7.84			957
Private collateralized mortgage obligations		3,543			5.10			131		1,997			6.48			93

Total mortgage-backed securities		24,775			5.88			1,058		19,314			7.70			1,050
Other debt securities (4)		3,444			7.66			177		3,243			7.77			179

Total debt securities available for sale (4)		32,861			6.21			1,467		26,028			7.67			1,410
Mortgages held for sale (3)		32,226			5.35			1,294		64,609			5.33			2,585
Loans held for sale (3)		8,088			3.39			205		7,064			3.62			191
Loans:
Commercial and commercial real estate:
Commercial		48,515			5.71			2,074		47,146			6.13			2,164
Other real estate mortgage		28,472			5.24			1,116		25,561			5.50			1,052
Real estate construction		8,548			5.12			328		7,888			5.16			305
Lease financing		5,055			6.37			241		4,435			6.26			208

Total commercial and commercial real estate		90,590			5.54			3,759		85,030			5.86			3,729
Consumer:
Real estate 1-4 family first mortgage		88,140			5.36			3,539		51,147			5.65			2,164
Real estate 1-4 family junior lien mortgage		42,235			5.03			1,591		30,497			6.00			1,368
Credit card		8,599			11.89			767		7,514			12.14			684
Other revolving credit and installment		33,211			9.02			2,243		29,117			9.17			1,997

Total consumer		172,185			6.31			8,140		118,275			7.02			6,213
Foreign		2,901			15.91			346		2,126			18.10			289

Total loans (5)		265,676			6.15			12,245		205,431			6.65			10,231
Other		8,075			2.83			171		7,918			2.87			170

Total earning assets	$	349,947			5.90			15,408	$	315,055			6.23			14,622


FUNDING SOURCES
Deposits:
Interest-bearing checking	$	2,997			.35			8	$	2,512			.29			5
Market rate and other savings		121,048			.64			576		104,826			.68			533
Savings certificates		18,902			2.24			317		21,257			2.60			413
Other time deposits		29,510			1.25			275		25,052			1.24			233
Deposits in foreign offices		8,446			1.19			75		6,083			1.15			52

Total interest-bearing deposits		180,903			.92			1,251		159,730			1.03			1,236
Short-term borrowings		26,067			1.16			227		30,414			1.12			254
Long-term debt		66,976			2.31			1,160		52,141			2.61			1,020
Guaranteed preferred beneficial interests in Company’s subordinated debentures		—			—			—		3,210			3.69			88

Total interest-bearing liabilities		273,946			1.29			2,638		245,495			1.41			2,598
Portion of noninterest-bearing funding sources		76,001			—			—		69,560			—			—

Total funding sources	$	349,947			1.01			2,638	$	315,055			1.11			2,598

Net interest margin and net interest income on a taxable-equivalent basis (6)					4.89	%	$	12,770					5.12	%	$	12,024


NONINTEREST-EARNING ASSETS
Cash and due from banks	$	12,950							$	13,551
Goodwill		10,412								9,803
Other		32,340								36,800

Total noninterest-earning assets	$	55,702							$	60,154


NONINTEREST-BEARING FUNDING SOURCES
Deposits	$	78,099							$	77,446
Other liabilities		18,237								20,714
Stockholders’ equity		35,367								31,554
Noninterest-bearing funding sources used to fund earning assets		(76,001	)							(69,560	)

Net noninterest-bearing funding sources	$	55,702							$	60,154


TOTAL ASSETS	$	405,649							$	375,209



(income/expense in millions,	Community				Wholesale				Wells Fargo										Consolidated
average balances in billions)	Banking				Banking				Financial				Other (2					)	Company
Quarter ended September 30,	2004		2003		2004		2003		2004		2003		2004			2003			2004		2003

Net interest income (1)	$	3,173	$	2,990	$	531	$	556	$	715	$	599	$	(1	)	$	(3	)	$	4,418	$	4,142
Provision for credit losses		199		213		10		54		199		159		—			—			408		426
Noninterest income		2,079		2,379		723		707		93		97		5			8			2,900		3,191
Noninterest expense		3,143		3,603		678		629		398		343		1			—			4,220		4,575

Income before income tax expense		1,910		1,553		566		580		211		194		3			5			2,690		2,332
Income tax expense		664		488		203		208		74		73		1			2			942		771

Net income	$	1,246	$	1,065	$	363	$	372	$	137	$	121	$	2		$	3		$	1,748	$	1,561

Average loans	$	189.9	$	146.0	$	53.7	$	49.0	$	30.7	$	21.2	$	—		$	—		$	274.3	$	216.2
Average assets		303.7		290.2		77.4		75.7		32.5		22.9		6.0			6.2			419.6		395.0
Average core deposits		199.6		191.8		25.3		23.8		.1		.1		—			—			225.0		215.7

Nine months ended September 30,

Net interest income (1)	$	9,008	$	8,633	$	1,652	$	1,667	$	2,039	$	1,672	$	(5	)	$	(7	)	$	12,694	$	11,965
Provision for credit losses		626		656		51		154		575		448		—			—			1,252		1,258
Noninterest income		6,578		6,674		2,271		2,015		279		283		69			9			9,197		8,981
Noninterest expense		9,263		9,830		2,010		1,885		1,151		973		178			2			12,602		12,690

Income (loss) before income tax expense (benefit)		5,697		4,821		1,862		1,643		592		534		(114	)		—			8,037		6,998
Income tax expense (benefit)		1,968		1,638		666		580		214		202		(40	)		—			2,808		2,420

Net income (loss)	$	3,729	$	3,183	$	1,196	$	1,063	$	378	$	332	$	(74	)	$	—		$	5,229	$	4,578

Average loans	$	185.4	$	136.7	$	52.0	$	49.4	$	28.3	$	19.3	$	—		$	—		$	265.7	$	205.4
Average assets		293.4		271.8		76.3		76.1		29.9		21.1		6.0			6.2			405.6		375.2
Average core deposits		195.6		184.1		25.3		21.8		.1		.1		—			—			221.0		206.0

Wells Fargo & Company and Subsidiaries
FIVE QUARTER OPERATING SEGMENT RESULTS



	Quarter ended
	Sept. 30		,	June 30		,	Mar. 31		,	Dec. 31		,	Sept. 30		,
(income/expense in millions, average balances in billions)	2004			2004			2004			2003			2003


COMMUNITY BANKING
Net interest income	$	3,173		$	2,989		$	2,846		$	2,864		$	2,990
Provision for credit losses		199			213			214			236			213
Noninterest income		2,079			2,359			2,140			2,544			2,379
Noninterest expense		3,143			3,126			2,994			3,385			3,603

Income before income tax expense		1,910			2,009			1,778			1,787			1,553
Income tax expense		664			693			611			605			488

Net income	$	1,246		$	1,316		$	1,167		$	1,182		$	1,065

Average loans	$	189.9		$	185.9		$	180.3		$	162.7		$	146.0
Average assets		303.7			298.8			277.4			278.5			290.2
Average core deposits		199.6			198.9			188.3			186.3			191.8

WHOLESALE BANKING
Net interest income	$	531		$	559		$	562		$	561		$	556
Provision for credit losses		10			18			23			23			54
Noninterest income		723			720			828			750			707
Noninterest expense		678			663			669			694			629

Income before income tax expense		566			598			698			594			580
Income tax expense		203			213			250			212			208

Net income	$	363		$	385		$	448		$	382		$	372

Average loans	$	53.7		$	52.1		$	50.3		$	49.8		$	49.0
Average assets		77.4			75.8			75.7			74.8			75.7
Average core deposits		25.3			25.9			24.7			23.6			23.8

WELLS FARGO FINANCIAL
Net interest income	$	715		$	680		$	644		$	638		$	599
Provision for credit losses		199			209			167			176			159
Noninterest income		93			84			102			96			97
Noninterest expense		398			387			366			370			343

Income before income tax expense		211			168			213			188			194
Income tax expense		74			63			77			69			73

Net income	$	137		$	105		$	136		$	119		$	121

Average loans	$	30.7		$	28.2		$	25.8		$	23.5		$	21.2
Average assets		32.5			29.8			27.4			25.3			22.9
Average core deposits		.1			.1			.1			.1			.1

OTHER (1)
Net interest income	$	(1	)	$	(2	)		(2	)	$	(19	)	$	(3	)
Provision for credit losses		—			—			—			30			—
Noninterest income		5			37			27			11			8
Noninterest expense		1			177			—			51			—

Income (loss) before income tax expense (benefit)		3			(142	)		25			(89	)		5
Income tax expense (benefit)		1			(50	)		9			(30	)		2

Net income (loss)	$	2		$	(92	)	$	16		$	(59	)	$	3

Average loans	$	—		$	—		$	—		$	—		$	—
Average assets		6.0			6.1			6.1			6.1			6.2
Average core deposits		—			—			—			—			—

CONSOLIDATED COMPANY
Net interest income	$	4,418		$	4,226		$	4,050		$	4,044		$	4,142
Provision for credit losses		408			440			404			465			426
Noninterest income		2,900			3,200			3,097			3,401			3,191
Noninterest expense		4,220			4,353			4,029			4,500			4,575

Income before income tax expense		2,690			2,633			2,714			2,480			2,332
Income tax expense		942			919			947			856			771

Net income	$	1,748		$	1,714		$	1,767		$	1,624		$	1,561

Average loans	$	274.3		$	266.2		$	256.4		$	236.0		$	216.2
Average assets		419.6			410.5			386.6			384.7			395.0
Average core deposits		225.0			224.9			213.1			210.0			215.7

Wells Fargo & Company and Subsidiaries
FIVE QUARTER CONSOLIDATED MORTGAGE SERVICING (1)



	Quarter ended
	Sept. 30		,	June 30		,	Mar. 31		,	Dec. 31		,	Sept. 30		,
(in millions)	2004			2004			2004			2003			2003


Mortgage servicing rights:
Balance, beginning of quarter	$	10,100		$	8,270		$	8,848		$	7,589		$	6,375
Originations		465			597			338			674			1,377
Purchases		261			466			268			410			874
Amortization		(411	)		(431	)		(511	)		(459	)		(572	)
Write-down		—			—			(169	)		—			(492	)
Other (includes changes in mortgage servicing rights due to hedging)		(848	)		1,198			(504	)		634			27

Balance, end of quarter	$	9,567		$	10,100		$	8,270		$	8,848		$	7,589


Valuation allowance:
Balance, beginning of quarter	$	1,588		$	2,173		$	1,942		$	1,824		$	2,554
Provision (reversal of provision) for mortgage servicing rights in excess of fair value		211			(585	)		400			118			(238	)
Write-down of mortgage servicing rights		—			—			(169	)		—			(492	)

Balance, end of quarter	$	1,799		$	1,588		$	2,173		$	1,942		$	1,824


Mortgage servicing rights, net	$	7,768		$	8,512		$	6,097		$	6,906		$	5,765


Ratio of mortgage servicing rights to related loans serviced for others		1.18	%		1.37	%		1.00	%		1.15	%		1.03	%

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


Media		Investors
Janis Smith		Bob Strickland
(415) 396-7711		(415) 396-0523



	Nine months ended Sept. 30					,
(in millions)	2004			2003

Balance, beginning of period	$	34,469		$	30,319
Net income		5,229			4,578
Other comprehensive income (loss), net of tax:
Change in foreign currency translation adjustments		4			20
Change in valuation allowance related to:
Investment securities and other retained interests		(16	)		(77	)
Derivative instruments and hedging activities		(12	)		(347	)
Common stock issued		1,045			587
Common stock issued for acquisitions		9			6
Common stock repurchased		(1,909	)		(1,289	)
Preferred stock released to ESOP		210			192
Preferred stock dividends		—			(3	)
Common stock dividends		(2,337	)		(1,764	)
Other, net		(12	)		111

Balance, end of period	$	36,680		$	32,333


Selected Financial Information	Third Quarter									Nine months ended Sept. 30								,
							%									%
Earnings	2004			2003			Change			2004			2003			Change
Diluted earnings per share	$	1.02		$	.92			11		$	3.05		$	2.70			13
Net income (in millions)		1,748			1,561			12			5,229			4,578			14
Asset Quality
Net charge-offs (in millions)	$	407		$	424			(4	)	$	1,201		$	1,254			(4	)
Nonperforming assets as % of total loans		.56	%		.75	%		(25	)		.56	%		.75	%		(25	)
Other
Revenue (in millions)	$	7,318		$	7,333			—		$	21,891		$	20,946			5
Average loans (in billions)		274.3			216.2			27			265.7			205.4			29
Average core deposits (in billions)		225.0			215.7			4			221.0			206.0			7

(1)		The efficiency ratio is defined as noninterest expense divided by total revenue (net interest income and noninterest income).
(2)		Core deposits consist of noninterest-bearing deposits, interest-bearing checking, savings certificates and market rate and other savings.
(3)		The September 30, 2004 ratios are preliminary.

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

(1)		Our average prime rate was 4.42% and 4.00% for the quarters ended September 30, 2004 and 2003, respectively. The average three-month London Interbank Offered Rate (LIBOR) was 1.75% and 1.13% 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.

(1)		Our average prime rate was 4.14% and 4.16% for the nine months ended September 30, 2004 and 2003, respectively. The average three-month London Interbank Offered Rate (LIBOR) was 1.39% and 1.23% 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.

(1)		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. In general, Community Banking has excess liabilities and receives interest credits for the funding it provides to other segments.
(2)		The other income and expense items principally relate to Corporate level equity investment activities, and other separately identified transactions recorded at the enterprise level, including for the second quarter of 2004, a $176 million loss on debt extinguishment. Average assets consist of unallocated goodwill held at the enterprise level.