If the talk on the street is true that Morgan Stanley is the next takeover candidate, then will California-based Wells Fargo be a likely buyer? They acquired Wachovia, a small investment banking operation and have fared decently in the middle market and are the fourth largest U.S. bank. [pullquote] …the lure of Wall Street[/pullquote]
However, Wells Fargo has never been perceived as a big Wall Street power firm. Should they decide to make this “leap” and take over Morgan Stanley, it would bring a top-notch investment bank which was once among the Wall Street elite into its folds, thus becoming the country’s largest brokerage.
But, like Bank of America-Merrill Lynch, there would be issues, largely centered on cultural differences and the need to expand their trading operation and global outreach which means capital output and increased risk.
Wells Fargo just may not want the hassle in view of BofA Merrill’s problems, but then again it may depend on “the lure of Wall Street.”