Wells Fargo’s David Carroll, key leader in 2008 crisis, to retire next month

Wells Fargo executive David Carroll, who played a key role in leading Wachovia through the financial crisis, will retire next month, giving Charlotte one less high-ranking executive at the No. 3 U.S. bank.

As a top leader at Charlotte-based Wachovia, Carroll worked closely with then-CEO Bob Steel to find a buyer for the struggling company in the fall of 2008. After forging a deal with Wells, he remained in Charlotte as head of the company’s wealth and investment management unit, becoming the face of the newly merged bank in the city.

Carroll, 60, will be replaced July 1 by Jonathan Weiss, head of Wells Fargo Securities, who will remain based in New York, the bank said Thursday. Carroll will stay with the company until the end of July to help with the transition, Wells said.

In an interview with the Observer Thursday, Carroll described age 60 as an “inflection point.”

“There are things I want to do in life, and now is a good time to do them while I’m still healthy and crazy enough to still do them,” said Carroll, who plans to stay in Charlotte. Those plans include becoming more active with a private-investment business he started with his sons a couple of year ago, hiking the Appalachian Trail and becoming fluent in Spanish, he said.

For Charlotte, it means the loss of a direct report to CEO Tim Sloan, who will now have just two top executives in the city reporting to him. The remaining top leaders are Mary Mack, who took over Wells’ community banking operation right before the bank became mired in a sales scandal in September, and chief auditor David Julian.

In a statement, Sloan praised Carroll’s roughly 38-year career with Wells Fargo and Charlotte predecessor companies Wachovia and First Union, which combined in a 2001 merger. Wells Fargo acquired Wachovia seven years later, establishing Charlotte as its biggest employment hub.

“David has devoted his entire career to our company, managing through intricate mergers and every possible economic cycle with an inspiring vision, prudent judgment and the highest integrity,” Sloan said.

Turbulent times

Carroll’s first job after graduating from UNC-Chapel Hill was as personal banker for Winston-Salen-based Wachovia in 1979, opening accounts and making loans in Greensboro. Two years later, he moved to Charlotte-based First Union.

Two decades later, when First Union merged with Wachovia, Carroll was tapped to lead the transition before eventually becoming head of the unit that included the brokerage business. Once seen as a possible CEO candidate, his career took a turn in 2008 when Wachovia verged on collapse in the financial crisis.

Steel joined Wachovia that summer looking to fix a company weighed down by bad mortgage and commercial loans, but quickly turned to selling the bank to a more stable institution. Carroll joined in merger discussions and even approached Berkshire Hathaway’s Warren Buffett about a possible investment.

The sale to Wells Fargo meant the city lost the headquarters of one of its two big banks, but it helped preserve thousands of banking jobs and kept investors from potentially absorbing even bigger losses. In October 2008, shortly after the agreement with Wells, Carroll had surgery to rebuild a heart valve, and in 2011 he led a major fundraiser for the Greater Charlotte American Heart Association.

“I think about it pretty frequently,” Carroll said in 2013 about those turbulent times. “It has colored my view on things like risk management, how you run your business and thinking about what you don’t know on any given day. So I would say it had a pretty big impact on me.”

In Charlotte, Carroll has been as a key local figure for Wells Fargo, serving with other local business leaders in a group called the Charlotte Executive Leadership Council, which tackles issues such as economic mobility and education. Carroll has also been a regular participant in the Charlotte Chamber of Commerce’s annual economic outlook luncheon held each December.

On Thursday, Carroll said he remains on the leadership council but plans to recommend to Sloan that someone from Wells Fargo take his seat.

Securities leadership to be named

Under Carroll, the wealth management unit has pushed to get business from affluent customers being served by the community banking division, a strategy that has yielded new investments.

But Carroll was also among eight executives the bank’s board stripped of 2016 cash bonuses and a portion of 2014 stock awards following allegations Wells employees opened as many as 2 million fake accounts in order to meet high-pressure sales goals. The board said the compensation actions were not related to any findings of improper behavior by the executives, but were designed to promote accountability following the scandal.

Despite the forfeitures, Carroll’s total compensation for last year rose to $9.2 million, compared with about $9 million the year before, thanks to a rise in base salary and stock awards.

Carroll said he didn’t have any interest in “retroactively speculating” about the sales scandal, which he described as “terrible activity.”

“I will say this: Bad things can happen to good companies, and the effect washes over the whole company,” he said. “The measure, I think – one guy’s opinion – is how the company responds and follows up.”

Charlotte, home to about 24,000 Wells employees, is not expected to lose other executives as a result of Thursday’s announcement, said bank spokeswoman Kathleen Leary. Wells Fargo Securities leaders in Charlotte include Rob Engel, head of investment banking and capital markets; Walter Dolhare, head of the markets division; Mary Katherine Dubose, co-head of asset-backed finance; and Phil Smith, head of government and institutional banking. Wells said Thursday it will announce new leadership for the securities operation prior to Weiss’ transition to his new role.

In a tribute to Carroll, the bank said the lights outlining uptown’s Duke Energy Center, which Wells Fargo owns, would be lit Thursday night in the bank’s red and yellow colors.

This story was originally published June 1, 2017 at 10:32 AM with the headline "Wells Fargo’s David Carroll, key leader in 2008 crisis, to retire next month."