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Living Wells Is the Best Revenge

By

After 21 years at Norwest/Wells Dick Kovacevich has accumulated enough personal wealth to qualify has a Big Fish in whatever pond in which he'd choose to swim.

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In a market dominated by debates over whether or not Blackstone's (BX) Steve Schwarzman "deserves" the enormous windfall from his IPO and what, on earth, the people who bought that IPO when it opened for trading did to deserve the pain they are feeling, there's a headline getting almost no play that deserves some attention. Here are some hints: It's in the financial space. It involves a major bank, deeply involved in the mortgage business. It concerns the resignation of a CEO who has been compensated beyond most men's wildest dreams.

If you guessed that the story is the retirement of Wells Fargo (WFC) CEO Dick Kovacevich you probably either work for Wells Fargo or you're rather unhealthily concerned with the inner pages of your newspaper's business section.

Kovacevich (pronounced: ko-VAH-suh-vich) has a story worth telling. Hell, I'm biased for reasons we'll get to but I think Dick has a story any good capitalist with a soul should not only know but wrap themselves in like a child's blanket, in order to ward off the ugliness, pettiness and cruel fates of the financial world before the darkness worm its way into your heart, causing terminal cynicism. It's the story of a born winner, crushed and cast into financial Siberia, who came back ended up with the money, the reputation and a kick-ass tan.


Exile

I met Kovacevich and his family in 1987, shortly after they had moved to Minnesota so Dick could take the top job at Norwest Bank. He hardly seemed a broken man but the backstory on how Dick arrived in Minnesota is that he'd been fast-tracking to the top of Citigroup (C) before losing a power-struggle that cost him his job. After he'd left Citi and taken the Norwest job, Dick and his family had moved from Greenwich, Connecticut to Wayzata, Minnesota. Greenwich is internationally regarded as the leafy community where hedge fund managers and big, swinging NYC bankers make their homes. Wayzata is best known as being where the Walsh twins lived before moving to Beverly Hills 90210 (and the 90210 producers never bothered to teach Shannon Doherty how to pronounce it; the city is "WHY-zet-ah" not "way-ZAT-A").

Now, Wayzata and Greenwich are both gorgeous communities with nice schools, good looking kids etc. The point isn't to bag on my homeland. Let's just say this: I'm sure Siberia has it's selling points but when Russian dissidents arrive there from Moscow I doubt that even the Siberian locals consider it a personal or professional upgrade.


A Dish Best Served "Cool"

Lesser men and lesser bankers would have accepted the exile and gone quietly into that lucrative but obscure goodnight. They'd have gotten a nice house on one of Minnesota's 10,000 lakes and been a large fish in a much smaller pond. Instead of going that route, Dick turned Norwest into a juggernaut. He focused on the customer service experience in the bank branches, insisting on calling them "stores" and demanding that customers be treated not as "assets" but rather human beings with a choice as to where they did their banking. It shouldn't have been a revolutionary idea but, as it turns out, it was.

In 1998 Dick and Norwest stepped out of the regionals and into the financial Big Leagues by purchasing Wells Fargo. The folks at Citi and the rest of the New York banking crew may look down their noses at Wells or anyone else without a Manhattan home-base but consider that Wells has about half a trillion dollars in assets, a market value of $117 bln or so, over 6,000 stores and is the 19th most profitable company in the world. According to Barron's, Wells is also the 12th most admired company in the world.

After 21 years at Norwest/Wells Dick has accumulated enough personal wealth to qualify as a Big Fish in whatever pond in which he'd choose to swim. While he'd be the first to tell you it's not about the money, he was paid $29-million last year and has collected enough stock options over the years to buy a small country; certainly enough to buy whatever kind of place he'd like in Greenwich, if he ever got crazy enough to want to leave San Francisco. He oversaw the purchase of a bank with more than 150 years of history and is leaving it a much better place than when he found it. He's going to be fully retired at 65 with good friends, a great family and the reputation and wherewithal to do whatever he wants with the rest of his life.

What he mostly has is self-respect, dignity and success. In corporate America, where everyone seems to end up fired or humiliated in some form or another, Dick Kovacevich is a winner and someone I'm proud to call a friend.

From where I'm sitting, his is a story that deserves to be told as Dick rides off into the sunset.

No positions in stocks mentioned.

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