WFC Wells Fargo and Company

By James R. Hagerty 

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (July 22, 2017).

As chief executive of Wells Fargo & Co., Carl Reichardt said he thought of himself "not as a banker but as a businessman who happens to be running a bank."

The typical banker, he said in a 1994 interview with the Los Angeles Times, "has the mind-set of a civil servant, in terms of cost control and having a guaranteed income for life."

Not for him were other bankers' palatial offices or private-jet jaunts to mingle with princes and pop stars.

Mr. Reichardt, CEO from 1983 to 1994, declared war on costs in ways big and small. He sold the corporate jet and at one meeting demanded to know why it was necessary to put the documents being discussed into ring binders when paper clips would do. He banished potted plants and underperforming employees.

After pulling the bank out of Latin American lending and other overseas entanglements, Mr. Reichardt focused on California, which he called "the best banking market in the world." When he retired at the end of 1994, the bank calculated that its total returns to shareholders during his reign had been more than four times the S&P 500 average. Warren Buffett's Berkshire Hathaway became a major shareholder on his watch.

Colleagues said Mr. Reichardt excelled at assessing credit risks. It helped that he got up early -- often after sleeping only five hours or so. Though he could be gruff, underlings knew where they stood.

Mr. Reichardt died July 13 of what his family said was a long illness. He was 86.

Carl Edwin Reichardt was born July 6, 1931, in Houston, where his father worked as a hotel manager. By age 12, Carl was working in a lumber yard. He enlisted in the Navy during the Korean War and was stationed in Long Beach, Calif., then earned an economics degree at the University of Southern California.

One of his early banking jobs was at Union Bank of California, headed by Harry J. Volk. "Harry called me in one day," Mr. Reichardt said in a 1989 interview with the New York Times, "and he told me, 'Carl, you may be a great banker, but you've got to learn to sell.' Most bankers had the idea, you sit there and customers come in and you sort of judge them. Harry said that was all wrong, that you had to go out and drag them in."

In 1970, he joined Wells Fargo, where he rose to president in 1979 and CEO in 1983. The bank's 1986 acquisition of Crocker National Corp. for $1.1 billion was a chance to slash costs by eliminating overlaps.

Heavy lending to commercial real-estate companies led to a plunge in profit in the early 1990s when California's property market tanked. The bank survived that storm, and analysts said it had been more careful than many rivals in sizing up loan risks.

On weekends, Mr. Reichardt brought work home in a cardboard box that he called "my Gucci." During the energy crisis of the 1970s, he urged his children to switch off lights promptly and promised to share with them any savings in the electric bill.

Mr. Reichardt yearned to take over another California bank, First Interstate Bancorp, but executives there rebuffed him. "I was out there on the dance floor with my rouge on, but nobody came out," he said in a 1994 interview.

In 1996, after he retired, Wells Fargo finally acquired First Interstate in a hostile takeover, then struggled to combine the two operations, losing some customers annoyed by poor service during the integration. In 1998, a bruised Wells Fargo merged with Norwest Corp.

Some of Mr. Reichardt's imprint remains. Tim Sloan, Wells Fargo's current CEO, said his office still contains some of the "same ratty chairs" that were there in the early 1990s. "When we talk about changing furniture, I think, if Carl was here, he'd be fine with" the old furnishings, said Mr. Sloan.

Mr. Reichardt's retirement was interrupted in 2001 when he became vice chairman of Ford Motor Co., where he spent about two years helping to sort out the auto maker's consumer-credit business.

In his spare time, he read about history. He is survived by his wife of 63 years, Patricia, three children and six grandchildren.

"Work is not a pejorative," he often said.

Write to James R. Hagerty at bob.hagerty@wsj.com

(END) Dow Jones Newswires

July 22, 2017 02:47 ET (06:47 GMT)

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