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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: As we've been reporting, the Trump trade has been an

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Speaker 2: absolute boon for the stock market, the dollar, and bitcoin,

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Speaker 2: and these moves are reshaping the investment landscape. As Donald

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Speaker 2: Trumper turns to the White House in January with a

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Speaker 2: pro growth agenda, certain industry is seen as beneficiaries, like banks,

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Speaker 2: which are up just over fourteen percent since election day.

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Speaker 2: I'm pleased to now welcome Doug Bronstein, vice chairman of

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Speaker 2: Wells Fargo, former CFO of JP Morgan Chase. Doug joined

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Speaker 2: Wells Fargo in February with a mandate to expand the

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Speaker 2: bank's corporate finance.

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Speaker 3: And advisory business. Good to see you, great see you, Scarlett,

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Speaker 3: and remain great to be here, thank you.

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Speaker 2: So, as remain mentioned earlier, today's merger Monday, thirty five

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Speaker 2: billion dollars of deals announced across different sectors, including one

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Speaker 2: that Wells advised on quickly buying Summit materials for eleven

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Speaker 2: and a half billion dollars. Last week, well was advised

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Speaker 2: on bury buying Amcore.

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Speaker 3: To what extent are these deals.

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Speaker 2: Emblematic of what we might expect to see in the

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Speaker 2: months ahead.

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Speaker 4: So Scarlett It's a great question, and I think in

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Speaker 4: your opening you covered a number of the factors quite frankly,

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Speaker 4: that I think are going to drive M and A

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Speaker 4: activity both today and going forward into twenty twenty five.

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Speaker 4: And it really amounts to the factors that create confidence

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Speaker 4: for CEOs. And there's really four key ones here. The

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Speaker 4: first is the underlying economic environment. It feels increasingly comfortable

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Speaker 4: to folks that we've had a soft landing.

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Speaker 3: There's an expectation that we will.

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Speaker 4: Have a positive GDP.

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Speaker 3: For twenty twenty five and going forward.

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Speaker 4: The second is the robust support in the capital markets.

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Speaker 4: The debt markets, which we can talk about in a

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Speaker 4: little bit more detail, are wide open. We've actually had

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Speaker 4: a number of those capital markets with record issuance in

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Speaker 4: twenty twenty four, and credit spreads are at or near

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Speaker 4: for many of these categories multi year tights. The third

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Speaker 4: piece is the stock market. You've got sellers in the

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Speaker 4: public markets where there are stock prices actually performed really well,

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Speaker 4: and in particular the small and MidCap names in the

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Speaker 4: Russell remain that you talked about. Those comprise a lot

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Speaker 4: of sellers in the market, and when you're selling adder

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Speaker 4: near your fifty two week high. It's a much easier

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Speaker 4: discussion in the boarder room. And then finally the buyers,

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Speaker 4: with that their own stock prices at strong performance and

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Speaker 4: this access to capital, that makes for a very potent

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Speaker 4: M and A combination.

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Speaker 3: Yeah, that's quite the cocktail.

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Speaker 2: So I mentioned that you joined Wells Fargo in February

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Speaker 2: with this mandate to focus on expanding the investment bank operations.

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Speaker 2: There's a lot of excitement about M and A and

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Speaker 2: IPOs picking up. How does this influence your plans when

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Speaker 2: it comes to hiring for this build out of the

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Speaker 2: investment bank.

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Speaker 4: Yeah, so, Scarlet, Actually you also meant you know, in

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Speaker 4: the last two weeks, Wells has announced to ten billion

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Speaker 4: dollar plus transactions, one advising on the cell side, which

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Speaker 4: was Bury, one advising on the buyside.

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Speaker 3: Quick Creek today.

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Speaker 4: Those are I think representative of some of the investments

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Speaker 4: that Wells has already made. So over the course of

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Speaker 4: the last twenty four months, we've already hired over sixty

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Speaker 4: managing directors across our M and A business, our equity

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Speaker 4: and debt capital markets, and our coverage businesses. And as

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Speaker 4: you know, when when bankers join, it takes them time

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Speaker 4: to understand the systems of our big institution and to

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Speaker 4: resement those relationships with their clients. We expect to continue

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Speaker 4: to invest over the course of twenty twenty five in

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Speaker 4: more coverage efforts, and you're just beginning, i think, in

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Speaker 4: the last two weeks to see the benefits of those

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Speaker 4: investments we've made. And I think our expectation is we

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Speaker 4: need to be ready as a firm to take advantage

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Speaker 4: of what our clients are going to need, which is

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Speaker 4: advice and capital to do deals in twenty twenty five.

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Speaker 1: So is the desire though, to do these bigger deals

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Speaker 1: like what we're saying with quick Break, the billion dollar

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Speaker 1: deals or more into the middle market areas that has

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Speaker 1: really been kind of the sweet spot.

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Speaker 3: For Wells for a while. Yeah. So, I mean it's

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Speaker 3: actually it's a great question.

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Speaker 4: You want to do both in order to be a

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Speaker 4: leading franchise. And one of the things that's really attractive

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Speaker 4: that attracted me to Wells is Wells has a deep,

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Speaker 4: strong relationship base with companies across the middle market through

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Speaker 4: the commercial bank and through the wholesale their corporate investment bank,

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Speaker 4: the larger companies and in order to have over time

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Speaker 4: a world class both.

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Speaker 3: M and A and capital markets practice. You need to

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Speaker 3: do both.

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Speaker 4: You need to have a strong presence in the middle market,

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Speaker 4: mostly to sell companies, and you need a strong presence

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Speaker 4: in the larger cap hopefully to advise.

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Speaker 3: On buying and on financing. Why don't think why don't

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Speaker 3: you think we saw that before?

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Speaker 1: Because there has been criticism that Wells didn't have a

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Speaker 1: big presence at least in the top end of the market.

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Speaker 1: But there was also criticism that with the middle market

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Speaker 1: companies that they weren't saying that as those companies grew

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Speaker 1: into bigger companies that they would then leave for you know,

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Speaker 1: JP Morgan or one of the other bigger banks.

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Speaker 4: Yeah. Well, you know again, I'm eight months since the

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Speaker 4: job and couldn't be happier the company itself, right, Charlie

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Speaker 4: Sharff came in five years ago, has built a whole

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Speaker 4: new management team. We've, as I mentioned, added significant talent

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Speaker 4: across the bank, and I think really.

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Speaker 1: Having trouble getting that talent specifically for those roles.

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Speaker 3: No, we're not. Actually.

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Speaker 4: I think it's in part because when people from the

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Speaker 4: outside look at the platform, we have this very long standing,

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Speaker 4: deep and wide relationship base with small, mid and large

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Speaker 4: cap companies, and what we're adding is that capability and

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Speaker 4: expertise to execute for them not only in their commercial

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Speaker 4: banking product needs, but across the entire spectrum of investment banking.

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Speaker 4: And so I think Romayne, you're just beginning to see

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Speaker 4: what has been a relatively recent investment start to pay off.

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Speaker 3: And you know, but it will take.

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Speaker 4: You know, relationship building, investment banking capabilities, those those products

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Speaker 4: take time, and we are absolutely committed to take the

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Speaker 4: time and make the investments necessary to be successful.

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Speaker 2: What are your thoughts on the overall hiring environment right

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Speaker 2: now for those senior bankers. How does it look to you?

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Speaker 4: You know, it is it's a good time to be

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Speaker 4: a very high quality banker because I think there's a

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Speaker 4: scarcity of those individuals.

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Speaker 3: In the marketplace.

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Speaker 4: The good news is, we think are franchise and the

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Speaker 4: platform and the opportunity set for people who are looking

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Speaker 4: over the next five to ten to twenty years and

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Speaker 4: really want to have an impact on the business that

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Speaker 4: they help bring in. I think we're a great platform

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Speaker 4: and as I said, we've already attracted a very large

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Speaker 4: number of senior professionals.

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Speaker 2: So I'm glad that remain touched on the middle market relationships,

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Speaker 2: relationships you have with middle market clients. Other firms with

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Speaker 2: large commercial banks like Bank America or JP Morgan are

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Speaker 2: trying to tap those kinds of businesses for fees as well.

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Speaker 2: It's very lucrative obviously, and Golden Sacks has also been

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Speaker 2: pretty aggressive. Is this because it's just a really big opportunity,

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Speaker 2: Doug or is this a reflection of how competitive it's

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Speaker 2: become or even hyper competitive?

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Speaker 4: So, Scarlett, there are really only three banks in the

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Speaker 4: US that have a sort of a national commercial bank footprint.

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Speaker 3: You mentioned two of them, Wells is the third.

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Speaker 4: Those relationships go back from many of these companies. They

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Speaker 4: were we provided them their first loan, so they are long.

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Speaker 3: And they're deep.

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Speaker 4: That part of the market is an incredibly important part

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Speaker 4: of the wallet share for all of the corporate finance products.

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Speaker 3: So if you want to be a leading.

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Speaker 4: Player, you have to compete in that segment of the market.

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Speaker 4: And for us, it's a place we've had long standing

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Speaker 4: relationships and we're now beginning to bring to those relationships

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Speaker 4: that world class execution capability.

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Speaker 3: So every part of.

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Speaker 4: The market, large and smallest competitive, but we think we

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Speaker 4: have some unique relationship capabilities and advantages that hopefully will

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Speaker 4: allow us to move quickly in that arena.

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Speaker 1: Doug, I have to ask you about what's going on

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Speaker 1: in Washington, particularly what the new administration coming in. He

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Speaker 1: I mean, what's your relationship like right now with folks

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Speaker 1: in Washington and b Do you think there's going to

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Speaker 1: be a material change in the approach that regulators have taken,

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Speaker 1: not just with the banking sector.

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Speaker 3: Are overall, but specifically with Wells Fargo. Yeah, so we.

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Speaker 4: As I talked about the M and A marketplace, I

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Speaker 4: would say the underlying backdrop for fundamentals remain are really strong.

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Speaker 4: You now add to that what the market believes to

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Speaker 4: be two things reflected in the new administration. One is

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Speaker 4: the fact that there's going to be a decrease in

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Speaker 4: the regulatory burden, both for industries on the whole and

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Speaker 4: as it relates to the FTC right, and so that removes,

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Speaker 4: quite frankly, a significant concern and impediment for a number

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Speaker 4: of CEOs that have deferred their action. The second thing

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Speaker 4: is that the market clearly believes that this will be

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Speaker 4: a pro growth agenda on balance, again giving confidence to

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Speaker 4: CEOs So when you look at both the market training

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Speaker 4: levels today as well as the underlying growth in M

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Speaker 4: and A transactions and the growing backlog, I think that

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Speaker 4: reflects a reasonably high degree of confidence that this administration

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Speaker 4: is going to be supportive of that activity.

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Speaker 1: So you have a high degree in confidence that Wells

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Speaker 1: Fargo is going to be able to grow with that

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Speaker 1: I e. Is that asset cap goun to still be

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Speaker 1: there because you're talking about a lot of opportunities, because

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Speaker 1: I'm sure you know there is a constraint to just

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Speaker 1: how much you can take advantage of those.

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Speaker 4: Yeah, I would leave you know, we have a lot

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Speaker 4: of public statements on that. I'm going to leave the

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Speaker 4: specifics of those comments to Charlie and Mike. What I

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Speaker 4: would say is that since I've been at the company,

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Speaker 4: in every decision that we make, we place the importance

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Speaker 4: of prudence and responsible decision making at the very heart

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Speaker 4: of how we address the needs of our clients, and

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Speaker 4: so I'm confident that we're going to be able to

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Speaker 4: prosper in the environment going forward.

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Speaker 2: So, Doug, we started with M and A, I kind

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Speaker 2: of want to go back to M and A come

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Speaker 2: full circle. Obviously, that feeds into other things like debt financing,

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Speaker 2: like equity financing as well. To what extent do you

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Speaker 2: plan to use M and A as an in to

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Speaker 2: those other feed generating businesses.

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Speaker 4: Yeah, So, Scarlett, the M and A business in many

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Speaker 4: ways drives some of the most important and quite frankly,

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Speaker 4: most profitable parts of the capital markets business. So today,

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Speaker 4: for example, we announced a buyside transaction where we are

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Speaker 4: helping that company to do the financing, as you've reported,

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Speaker 4: and that's a really important part of what we believe.

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Speaker 3: We brings capabilities, whether that's.

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Speaker 4: Debt or equity financing to our partners, and as one

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Speaker 4: of the country's largest banks, we have a significant amount

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Speaker 4: of capacity to help facilitate those transactions on the equity side,

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Speaker 4: both as a financing matter for our customers as well

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Speaker 4: as an alternative exit for parties who are thinking about

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Speaker 4: monetizing their investment. The opening up of the equity capital markets.

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Speaker 4: You know, there's been an increase in IPO volume this

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Speaker 4: year of almost fifty percent over last year.

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Speaker 3: We're still below.

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Speaker 4: Ten year trends, but again we think the opportunity set

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Speaker 4: for our customers, particularly in the commercial bank, to tap

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Speaker 4: those markets is going to be a significant factor into

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Speaker 4: twenty twenty five.

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Speaker 2: Doug, such a pleasure to have you on. Thank you

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Speaker 2: so much. Doug Bronson as vice chairman at Lallas Fargo,

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Speaker 2: also a prodlum of Cornell