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Wells Fargo's John McCune Ready to Call It Quits After 40 Years

CHICAGO - John McCune, the longtime head of Wells Fargo Institutional Brokerage and Sales, is ready to travel, hit the golf course and hang out with his grandkids after a 40-year career spent at the firm that was propelled into the top 10 with its acquisition late last year of Wachovia Corp.

McCune's departure comes as the firm has merged the broker-dealer practices of Wachovia Securities and Wells Fargo Brokerage Services and earlier this month launched its operations under the Wells Fargo Securities name with plans to expand its securities-related business.

"I would tell people at age 55 I planned to be retired, but by 60, I don't know what happened," McCune said in an interview ahead of his Aug. 14 retirement.

The Nebraska native who is based in Minnesota said he was tempted to stick around and play a role in the firm's latest chapter.

But, he said, "at 64, I am more interested in traveling to Ireland in September to play golf and then have a trip to Europe planned in November" with his wife Connie, a nurse, and entertaining his three young grandchildren.

McCune's longevity at one firm - though its name has evolved - is a rarity in the investment banking business. McCune was modest in reflecting on his success. "Wells Fargo has always been the acquirer," he said, adding that advice from his mentor to "never trade a bond that is smarter than you are" also helped.

After graduating from the University of Nebraska, he went to work for the National Bank of Omaha, which became Norwest Corp., focusing on credit analysis for the corporate lending department to agricultural borrowers.

In 1977, he was asked to help start a bond department. "I said 'I don't know anything about bonds,' but they said 'you know the names of every bank president,'" he recalled.

In 1981, he relocated to Minneapolis to become the sales manager and in 1991 took over as president of Norwest Investment Services Inc.

The firm, which built its business around the middle markets, grew significantly after the merger between the Minnesota-based Norwest and San Francisco-based Wells Fargo's in 1998 and McCune continued to manage the group. The fixed-income sales and trading teams manage more than 10,000 middle-market institutional customers and the public finance division has investment bankers in 13 states.

During his career he served on the Municipal Securities Rulemaking Board from 1994 to 1997, during which the agency established its Rule G-37 strictly limiting campaign contribution from municipal officials to politicians that influence bonding picks and G-38 requiring underwriters to report their use of consultants. He also worked on efforts to win federal approval in the 1980s to expand commercial banks' ability to sell municipal debt.

"John is leaving a lasting legacy at Wells Fargo," said his manager, John Shrewsberry. "He will be missed both personally and professionally. We want to thank him for his service and leadership and wish him the very best in the next chapter of his life."

The firm's brokerage was well-positioned for the acquisition and to manage through the financial crisis beginning last year with little exposure to the subprime mortgage market.

During his four decades in the business, McCune said he's witnessed a number of financial and market crisis, but none as jolting as the current one. He, like others, sees a return to more conservative standards and focus on underlying credit standards.

"We will be the better for it," he said.

The firm does faces challenges. Wells Fargo Bank and Wachovia Bank were both downgraded to AA from AA-plus and given negative outlooks by Standard & Poor's last month. The bank retains its top short-term marks.

The firm also said in May that the Federal Reserve had asked it to raise $13.7 billion by Nov. 9 due to the results of the government's bank stress tests. Wells Fargo was forced to write down $37.2 billion of Wachovia's loan book.

But the acquisition of Wachovia also greatly expands its investment banking platform and the firm is expanding its securities business as it seeks greater profits.

McCune believes the merger so far has gone smoothly as there was not significant overlap. Wells' operations were concentrated in Midwest, West and Southwest and Wachovia concentrated in the East, South and Midwest.

Although McCune won't be on hand to participate in the merged firms' next chapter, he believes it is well-poised to cement its place among top-tier firms.

Combined, the two firms ranked third overall among letter of credit providers since 2004 and now each offers enhanced distribution capabilities. Among senior managers, the firm ranks 10th for the first half of 2009 with 2.4% of the market share, according to Thomson Reuters.

As a result of the merger, the firm moved in January the brokerage business from the asset management group managed by Mike Niedermeyer to the securities investment group under Shrewsberry. Phil Smith is the municipal manager.

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