S&P affirms ‘AA/A-1+’ Rating on Wells Fargo Securities LLC with Negative Outlook

October 11 00:00 2011

NEW YORK, October11 (RainbowNewsLine.com) – S&P Credit Rating Services affirms its ‘AA/A-1+’ rating on Wells Fargo Securities LLC on its long and short-term counterparty credit rating and in addition, it assigned a negative outlook.

Analyst Kenneth Frey of S&P mentions that they consider WFS as a core subsidy of Well Fargo & Co. Hence, the rating and outlook is assigned in line with group rating methodology. He adds, “This classification reflects WFS’ strategic, operational, and business integration with WFC’s other businesses as well as our expectations for WFS to maintain its satisfactory performance, in line with the overall group, and to continue to receive support from WFC.”

WFS is highly integrated with WFC and is a registered US broker-dealer which provides fixed income & equity sales & trading, advisory and underwriting. The year-end ‘10 statements depicted $37.6 billion in assets. However, the negative outlook on WFS is reflecting the stance on WFC, and expects the ratings of WFS to follow the trend of Well Fargo & Co. The analyst could lower the WFS rating even more if it maintains a period of weak operating performance or any indication that WFS is not a core subsidiary of WFC. Therefore, the analyst stands on a negative outlook that is in line with the holding company.