Regulatory and Agency Capital Requirements

3 Months Ended

Mar. 31, 2019

Banking and Thrift [Abstract]

Regulatory and Agency Capital Requirements

Note 23: Regulatory and Agency Capital Requirements

The Company and each of its subsidiary banks are subject to regulatory capital adequacy requirements promulgated by federal bank regulatory agencies. The Federal Reserve establishes capital requirements for the consolidated financial holding company, and the OCC has similar requirements for the Company’s national banks, including Wells Fargo Bank, N.A. (the Bank).

Table 23.1 presents regulatory capital information for Wells Fargo & Company and the Bank using Basel III, which increased minimum required capital ratios, and introduced a minimum Common Equity Tier 1 (CET1) ratio. We must report the lower of our CET1, tier 1 and total capital ratios calculated under the Standardized Approach and under the Advanced Approach in the assessment of our capital adequacy. The Standardized Approach applies assigned risk weights to broad risk categories, while the calculation of risk-weighted assets (RWAs) under the Advanced Approach differs by requiring applicable banks to utilize a risk-sensitive methodology, which relies upon the use of internal credit models, and includes an operational risk component. The Basel III capital rules are being phased-in effective January 1, 2014, through the end of 2021. Beginning January 1, 2018, the requirements for calculating CET1 and tier 1 capital, along with RWAs, became fully phased-in. Accordingly, the information presented reflects fully phased-in CET1 capital, tier 1 capital, and RWAs, but reflects total capital still in accordance with Transition Requirements.

The Bank is an approved seller/servicer of mortgage loans and is required to maintain minimum levels of shareholders’ equity, as specified by various agencies, including the United States Department of Housing and Urban Development, GNMA, FHLMC and FNMA. At March 31, 2019, the Bank met these requirements. Other subsidiaries, including the Company’s insurance and broker-dealer subsidiaries, are also subject to various minimum capital levels, as defined by applicable industry regulations. The minimum capital levels for these subsidiaries, and related restrictions, are not significant to our consolidated operations.

Table 23.1:Regulatory Capital Information

	Wells Fargo & Company									Wells Fargo Bank, N.A.
	March 31, 2019						December 31, 2018			March 31, 2019			December 31, 2018
(in millions, except ratios)	Advanced Approach			Standardized Approach			Advanced Approach	Standardized Approach		Advanced Approach	Standardized Approach		Advanced Approach	Standardized Approach
Regulatory capital:
Common equity tier 1	$	148,124		148,124			146,363	146,363		145,091	145,091		142,685	142,685
Tier 1	169,611			169,611			167,866	167,866		145,091	145,091		142,685	142,685
Total	199,851			208,042			198,798	207,041		158,074	165,836		155,558	163,380
Assets:
Risk-weighted assets	$	1,176,360		1,243,125			1,177,350	1,247,210		1,056,290	1,143,763		1,058,653	1,154,182
Adjusted average assets (1)	1,854,367			1,854,367			1,850,299	1,850,299		1,647,785	1,647,785		1,652,009	1,652,009
Regulatory capital ratios:
Common equity tier 1 capital	12.59		%	11.92		*	12.43	11.74	*	13.74	12.69	*	13.48	12.36	*
Tier 1 capital	14.42			13.64		*	14.26	13.46	*	13.74	12.69	*	13.48	12.36	*
Total capital	16.99			16.74		*	16.89	16.60	*	14.97	14.50	*	14.69	14.16	*
Tier 1 leverage (1)	9.15			9.15			9.07	9.07		8.81	8.81		8.64	8.64
	Wells Fargo & Company									Wells Fargo Bank, N.A.
	March 31, 2019						December 31, 2018			March 31, 2019			December 31, 2018
Supplementary leverage: (2)
Total leverage exposure	$	2,180,614					2,174,564			1,951,217			1,957,276
Supplementary leverage ratio	7.78				%		7.72			7.44			7.29

*Denotes the lowest capital ratio as determined under the Advanced and Standardized Approaches.

(1) The leverage ratio consists of Tier 1 capital divided by quarterly average total assets, excluding goodwill and certain other items.

(2) The supplementary leverage ratio consists of Tier 1 capital divided by total leverage exposure. Total leverage exposure consists of the total average on-balance sheet assets, plus off-balance sheet exposures, such as undrawn commitments and derivative exposures, less amounts permitted to be deducted from Tier 1 capital.

Table 23.2 presents the minimum required regulatory capital ratios under Transition Requirements to which the Company and the Bank were subject as of March 31, 2019, and December 31, 2018.

Table 23.2:Minimum Required Regulatory Capital Ratios – Transition Requirements (1)

	Wells Fargo & Company			Wells Fargo Bank, N.A.
	March 31, 2019		December 31, 2018	March 31, 2019	December 31, 2018
Regulatory capital ratios:
Common equity tier 1 capital	9.000	%	7.875	7.000	6.375
Tier 1 capital	10.500		9.375	8.500	7.875
Total capital	12.500		11.375	10.500	9.875
Tier 1 leverage	4.000		4.000	4.000	4.000
Supplementary leverage	5.000		5.000	6.000	6.000

(1) At March 31, 2019, under transition requirements, the CET1, tier 1 and total capital minimum ratio requirements for Wells Fargo & Company include a capital conservation buffer of 2.500% and a global systemically important bank (G-SIB) surcharge of 2.000%. Only the 2.500% capital conservation buffer applies to the Bank at March 31, 2019.