Wells Fargo no longer brags about its cross-selling prowess; for better or worse, that term has a taint in the wake of the bank’s fraudulent sales scandal.

Since the scandal broke, Wells has stopped reporting its fabled cross-selling ratio, and executives at the bank have spoken about moving from a sales-oriented culture to one that is more service-driven.

But one of the clearest messages from the embattled company’s investor day was that selling additional products to existing customers remains a key part of the bank’s strategy.

Top Wells executives crowed Thursday about steps they are taking to improve customer referrals from the bank’s sprawling branch network to its wealth management unit. And in what seemed like déjà vu, the bank’s head of consumer lending said that one of his key strategies for building the mortgage business is to attract more of Wells Fargo’s existing customers.

The subtext seemed to be: yes, we are making changes as a result of the scandal, but don’t think that we have forgotten why this firm consistently earns more than $20 billion in annual profits. "For all of the angst that the company has been through over the last seven or eight months, one of the things that I do think is an enduring differentiator is the way people work together from one part of the business to the other,” said David Carroll, the bank’s senior executive vice president for wealth and investment management.

Below are five takeaways from the San Francisco-based company’s day full of pitches to investors.

FOCUSING MORE ON AFFLUENT CONSUMERS
Mary Mack was a top executive in Wells Fargo’s wealth management business before she was tapped as head of the company’s retail banking unit last year, and her presentation touched on opportunities to sell more investment products to customers who walk into the company’s 6,000 branches.

Mack recently overhauled the incentive pay formula for employees in branches; the old formula was widely blamed for encouraging dishonest behavior, as many staffers opened fraudulent accounts in an effort to hit sales quotas.

Under the revised formula, individual employees are rewarded based on the performance of the entire branch. That measure of branchwide performance takes into account loans that get made, deposits that get collected and investment products that get sold, Mack said Thursday.

As a result, employees have an incentive to send customers to the branch colleague who can meet their specific needs. And well-heeled customers are one segment where Mack said the bank sees a particular opportunity.

“Our team is realizing that you get the customer with the banker who has the skills,” she said.

COST-CUTTING A PRIORITY, BUT SOME ANALYSTS WANT TO SEE MORE
Analysts’ big question before Thursday was: How much would the bank cut its expenses, on top of the $2 billion in cuts it had already promised by the end of 2018?

In that context, Wells Fargo’s new vow to cut an additional $2 billion by the end of 2019 was not unexpected.

The megabank said that some of the new savings would come from additional branch closings — its new target is 450 shutdowns in 2017 and 2018, up from a previous plan of 400. But even after those cuts, Wells Fargo is likely to have the nation’s largest branch footprint, and executives fielded questions about why the bank is not cutting more quickly.

In addition to branch closures, other ways that Wells expects to cut expenses include streamlining its processes for opening accounts, routing customer calls more efficiently and assigning more staffers to some managers.

“We intend to aggressively target these areas,” Chief Financial Officer John Shrewsberry said.

WELLS CATALOGED MORE OF THE SCANDAL'S DAMAGE
Since last fall, Wells has been publishing monthly reports that have shown big declines in the number of consumers opening new checking accounts and applying for credit cards. CEO Tim Sloan said Thursday that Wells Fargo will not release any more of those monthly reports. But his fellow executives did provide new details about the scandal’s impact.

Product sales in the consumer lending unit were reduced by roughly 3% in the first quarter as a result of the scandal, according to a company presentation. The impact was biggest for products, such as home-equity loans, that rely more heavily on branch referrals. “Three percent is the impact so far,” Codel said. “It appears to be stabilizing.”

Carroll, who heads the bank’s wealth management unit, also acknowledged the scandal’s toll. He said that referrals from the retail banking unit fell from $1 billion in investment assets per month to around $600 million, though referrals have since recovered to just over $800 million per month.

“We were obviously negatively impacted,” he said. “But we’re in recovery mode right now.”

CROSS-SELLING IS CONTINUING EMPHASIS IN MORTGAGE BUSINESS
The nation’s largest mortgage lender is building a digital mortgage application process, aiming to eliminate much of the hassle that has traditionally been associated with buying a home.

Franklin Codel, Wells Fargo’s senior executive vice president of consumer lending, acknowledged Thursday that other mortgage lenders are developing similar products. What will distinguish Wells Fargo’s digital mortgage application from those developed by competitors is all of the data that the $1.9 trillion-asset bank has on its existing customers, Codel said.

The company is wagering that it will be more convenient for folks who already have a bank account or an investment account at Wells Fargo to get their mortgages from the same company, since Wells will be able to fill out much of the application automatically, using data it already has on file.

“We have the opportunity in many cases to provide a unique Wells Fargo experience,” Codel said.

WELLS SEEKS TO REDUCE ITS RISK IN AUTO LENDING
Like some other banks, Wells Fargo has recently tapped the brakes in auto lending, amid mounting concerns about rising late-payment rates across the sector.

The bank’s volume of new auto loans fell from $7.6 billion in the third quarter of 2016 to $5.5 billion in the first quarter of this year. Codel said Thursday that Wells has become more wary as a result of the falling value of cars, as well as the spread of riskier loans as competition for borrowers has intensified.

“We wanted to take very clear action to stay ahead of the curve,” he said.

Still, he emphasized that Wells Fargo’s recent pullback is a response to current conditions in the auto lending market, and not a long-term decision to scale back its footprint.

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Kevin Wack

Kevin Wack

Kevin Wack is a California-based reporter for American Banker who covers the U.S. consumer finance industry.