Wells Fargo & Company is a diversified financial services company with $1.3 trillion in assets. Founded in 1852 and headquartered in San Francisco, we provide banking, insurance, trust and investments, mortgage banking, investment banking, retail banking, brokerage services and consumer and commercial finance through more than 9,000 stores, 12,000 ATMs, the internet and other distribution channels to individuals, businesses and institutions in all 50 states, the District of Columbia (D.C.) and in other countries. With approximately 264,000 active full-time equivalent team members, we serve one in three households in America and ranked No. 23 on Fortune’s 2011 rankings of America’s largest corporations. We ranked fourth in assets and first in the market value of our common stock among our large bank peers at September 30, 2011.

Our Vision and Strategy

Our vision is to satisfy all our customers’ financial needs, help them succeed financially, be recognized as the premier financial services company in our markets and be one of America’s great companies. Our primary strategy to achieve this vision is to increase the number of products our customers buy from us and to offer them all of the financial products that fulfill their needs. Our cross-sell strategy, diversified business model and the breadth of our geographic reach facilitate growth in both strong and weak economic cycles, as we can grow by expanding the number of products our current customers have with us, gain new customers in our extended markets, and increase market share in many businesses.

Our retail bank household cross-sell was 5.91 products per household in third quarter 2011, up from 5.68 a year ago. We believe there is more opportunity for cross-sell as we continue to earn more business from our customers. Our goal is eight products per customer, which is approximately half of our estimate of potential demand for an average U.S. household. One of every four of our retail banking households has eight or more products. Business banking cross-sell offers another potential opportunity for growth, with cross-sell of 4.21 products in our Western footprint in third quarter 2011 (including legacy Wells

Fargo and converted Wachovia customers), up from 3.97 a year ago.

Our pursuit of growth and earnings performance is influenced by our belief that it is important to maintain a well controlled operating environment as we complete the integration of the Wachovia businesses and grow the combined company. We manage our credit risk by establishing what we believe are sound credit policies for underwriting new business, while monitoring and reviewing the performance of our loan portfolio. We manage the interest rate and market risks inherent in our asset and liability balances within established ranges, while ensuring adequate liquidity and funding. We maintain strong capital levels to facilitate future growth.

Expense management is important to us, but we approach this in a manner intended to help ensure our revenue is not adversely affected. Our current company-wide expense management initiative, project Compass, is focused on removing unnecessary complexity and eliminating duplication as a way to improve the customer experience and the work process of our team members. With this initiative and the completion of merger-related activities, we are targeting quarterly noninterest expense of approximately $11 billion by fourth quarter 2012. The target reflects expense savings initiatives that will be executed over the upcoming quarters. Quarterly expense trends may vary due to cyclical or seasonal factors, particularly in the first quarter of each year when higher incentive compensation and employee benefit expenses typically occur. In addition, we will continue to invest in our businesses and add team members where appropriate.

Financial Performance

Our third quarter 2011 results were strong despite continued economic volatility during the period, with solid growth in loans, deposits, investment securities and capital, along with improved credit quality and lower expenses. Wells Fargo net income was a record $4.1 billion in third quarter 2011, up 21% from a year ago, and diluted earnings per common share were $0.72, up 20%. Our net income growth from a year ago was primarily driven by a lower provision for credit losses and lower noninterest

expenses, which more than offset lower revenues. Net income growth from a year ago included contributions from each of our three business segments: Community Banking (up 20%); Wholesale Banking (up 20%); and Wealth, Brokerage and Retirement (up 14%). Return on average assets was 1.26% for third quarter 2011 compared with 1.09% a year ago. Our return on equity was 11.86% this quarter, up from 10.90% a year ago.

On a year-over-year basis, revenue was down 6% in third quarter 2011, reflecting decreased interest income on securities available for sale and loans due to lower yields as market rates declined, a decline in mortgage banking income and lower trading revenue. Noninterest expense was down 5% from a year ago reflecting the benefit of reduced personnel costs, reduced core deposit amortization, reduced integration costs and lower operating losses.

We believe strong loan and deposit growth are positioning us for continued financial performance improvement. Total loans were $760.1 billion at September 30, 2011, up from $757.3 billion at December 31, 2010. The net growth in loans from December 31, 2010, includes a $16.8 billion decrease in our non-strategic and liquidating portfolios. Our average core deposits grew 8% from a year ago to $836.8 billion at September 30, 2011. Average core deposits were 111% of total average loans in third quarter 2011, up from 102% a year ago. We continued to attract high quality core deposits in the form of checking and savings deposits, which on average totaled $769.2 billion, up 12% from a year ago as we added new customers and deepened our relationships with existing customers.

Credit Quality

We continued to experience improvement in our credit portfolio with lower net charge-offs, lower nonperforming assets (NPAs) and stable delinquency trends from second quarter 2011. The rate of improvement moderated in some portfolios in the quarter, consistent with our expectations at this point in the credit cycle. The improvement in our credit portfolio was due in part to the continued decline in balances in our non-strategic and liquidating loan portfolios (primarily from the Wachovia acquisition), which decreased $5.2 billion from second quarter 2011, and $74.3 billion in total since the beginning of 2009, to $116.5 billion at September 30, 2011.

Reflecting the continued improved performance in our loan portfolios, the $1.8 billion provision for credit losses for third quarter 2011 was $1.6 billion less than a year ago. The provision for credit losses was $800 million less than net charge-offs in third quarter 2011 and $650 million less than net charge-offs in the third quarter a year ago. Absent significant deterioration in the economy, we expect future allowance releases. Third quarter 2011 marked the seventh consecutive quarter of decline in net charge-offs and the fourth consecutive quarter of reduced NPAs. Net charge-offs decreased to $2.6 billion in third quarter 2011 from $2.8 billion in second quarter 2011 and $4.1 billion a year ago. NPAs decreased to $26.8 billion at September 30, 2011, from $27.9 billion at June 30, 2011, and $34.4 billion a year ago. Loans 90 days or more past due and still accruing (excluding government insured/guaranteed loans) increased slightly to $1.9 billion at September 30, 2011, from $1.8 billion at June 30, 2011, but decreased from $3.2 billion a year ago. In

addition, the portfolio of purchased credit-impaired (PCI) loans acquired in the Wachovia merger continued to perform better than expected at the time of the merger.

Capital

We continued to build capital in third quarter 2011, with total equity up $11.4 billion to $139.2 billion from December 31, 2010. In third quarter 2011, our Tier 1 common equity ratio grew 19 basis points to 9.34% of risk-weighted assets under Basel I, reflecting strong internal capital generation. Under current Basel III capital proposals, we estimate that our Tier 1 common equity ratio was 7.41% at the end of third quarter 2011. Our other regulatory capital ratios remained strong with a Tier 1 capital ratio of 11.26% and Tier 1 leverage ratio of 8.97% at September 30, 2011. Additional capital requirements applicable to certain systemically important global financial institutions, including Wells Fargo, are under consideration by the Basel Committee. See the “Capital Management” section in this Report for more information regarding our capital, including Tier 1 common equity.

In third quarter 2011 we called for redemption $5.8 billion of trust preferred securities that were redeemed in October 2011, repurchased 22 million shares of our common stock and entered into a $150 million private forward repurchase transaction that will settle in fourth quarter 2011 for an estimated 6 million shares of common stock. We also paid a common stock dividend of $0.12 per share.

Wachovia Merger Integration

On December 31, 2008, Wells Fargo acquired Wachovia, one of the nation’s largest diversified financial services companies. Our integration progress continued to be on track, and business and revenue synergies have exceeded our expectations since the merger was announced. To date we have converted 3,083 Wachovia retail banking stores and over 38 million customer accounts, including mortgage, deposit, trust, brokerage and credit card accounts. With the North Carolina retail bank store conversions completed in October 2011, all our retail bank store conversions are complete. Our remaining integration activities are expected to be completed in first quarter 2012, including certain deposit, brokerage and Wholesale Banking conversion events.

As a result of PCI accounting for loans acquired in the Wachovia merger, the Company’s ratios, including the growth rate in NPAs since December 31, 2008, may not be directly comparable with periods prior to the merger or with credit-related ratios of other financial institutions. In particular:

Helping Our Customers and the Economy

While the economic recovery remains uneven, we have not wavered from our commitment to do all we can to help our customers and the overall economy. We remain committed to helping homeowners stay in their homes. Since 2009, we have participated in more than 600 home preservation workshops, opened 27 home preservation centers, and arranged over 716,000 active trial or completed mortgage modifications. Within our Pick-a-Pay portfolio alone we have forgiven $4 billion of principal since we acquired this portfolio from Wachovia and modified approximately one-third of our total Pick-a-Pay loans as we strive to give customers an affordable, sustainable payment. As the number one small business lender for nine consecutive years (Community Reinvestment Act government data, 2010), we are committed to helping small businesses succeed by actively lending. We made over $10 billion in new loan commitments to our small business customers in the first nine months of 2011, up 8% from the same period a year ago. We are also the number one lender to mid-sized companies and we have had 14 consecutive months of loan growth to middle market commercial customers.

In addition to serving the financial needs of our business and individual customers, we also help our communities in many other ways. We employ one in every 500 working Americans and last year we contributed $219 million to 19,000 nonprofits across the United States and The Chronicle of Philanthropy named us “America’s Third Most Generous Cash Donor” for 2011. Our team members throughout the country are active volunteers in the communities where they live and work, volunteering over 900,000 hours during the first nine months of 2011.

So, while we are operating in a difficult environment with significant economic and regulatory challenges, we remain focused on helping our customers succeed financially and supporting our communities.

Wells Fargo net income for third quarter 2011 was $4.1 billion ($0.72 diluted per common share) compared with $3.3 billion ($0.60 diluted per common share) for third quarter 2010. Net income for the first nine months of 2011 was $11.8 billion, up 31% from the same period a year ago. Our September 30, 2011, quarterly and year-to-date earnings, compared with the same periods a year ago, reflected strong execution of our business strategy in a difficult economic environment with a diversified loan portfolio, balanced net interest and fee income, diversified sources of fee income, increased loans and deposits, lower operating costs, improved credit quality and generally higher capital levels.

Revenue, the sum of net interest income and noninterest income, was $19.6 billion in third quarter 2011 compared with $20.9 billion in third quarter 2010. Revenue for the first nine months of 2011 was $60.3 billion, down 5% from the same period a year ago. The decline in revenue in the third quarter and first nine months of 2011 was predominantly due to lower net interest income, mortgage banking and trading revenue. However, many businesses generated double-digit year-over-year quarterly revenue growth, including government and institutional banking, asset-backed finance, commercial real estate, international, debit card, global remittance, asset management, capital finance and real estate capital markets. Net interest income of $10.5 billion in third quarter 2011 declined 5% from a year ago and reflected a 41 basis point decline in the net interest margin and a 1% decline in average loans. The decline in average loans from third quarter 2010 reflected expected reductions in the non-strategic/liquidating portfolios. Continued success in generating low-cost deposits enabled the Company to grow assets by funding loan and securities growth while reducing long-term debt.

Noninterest expense was $11.7 billion (59% of revenue) in third quarter 2011, compared with $12.3 billion (59% of revenue) a year ago. Noninterest expense was $36.9 billion for the first nine months of 2011 compared with $37.1 billion for the same period a year ago. The third quarter and first nine months of 2011 included $376 million and $1.3 billion, respectively, of merger integration costs (down from $476 million in third quarter 2010 and $1.4 billion in the first nine months of 2010), and $780 million and $3.3 billion, respectively, of employee benefits expense (down from $1.1 billion in third quarter 2010 and $3.5 billion in the first nine months of 2010).

Net Interest Income

Net interest income is the interest earned on debt securities, loans (including yield-related loan fees) and other interest-earning assets minus the interest paid for deposits, short-term borrowings and long-term debt. The net interest margin is the average yield on earning assets minus the average interest rate paid for deposits and our other sources of funding. Net interest income and the net interest margin are presented on a taxable-equivalent basis in Table 1 to consistently reflect income from taxable and tax-exempt loans and securities based on a 35% federal statutory tax rate.

Net interest income and the net interest margin are significantly influenced by the mix and overall size of our earning asset portfolio and the cost of funding those assets. In addition, some sources of interest income, such as loan prepayment fees and collection of interest on nonaccrual loans, can vary from period to period. Net interest income on a taxable-equivalent basis was $10.7 billion and $32.4 billion in the third quarter and the first nine months of 2011, compared with $11.3 billion and $34.2 billion, respectively, for the same periods a year ago. The net interest margin was 3.84% and 3.96% in the third quarter and first nine months of 2011, respectively, down from 4.25% and 4.30% for the same periods a year ago. The decline in net interest income and the net interest margin was largely due to repricing of the balance sheet as higher-yielding loan and security runoff was partially offset by investment portfolio purchases and growth in short-term investments. The decline in earning asset income was mitigated by a reduction in funding costs resulting from disciplined deposit pricing, debt maturities, and calls of higher yielding trust preferred securities.

Compared to second quarter 2011, net interest income on a taxable-equivalent basis was down $137 million due to the repricing of the balance sheet. About half of the decline in interest income for securities available for sale was due to runoff offset by new purchases at lower yields. The remainder of the decline was from other sources, including a decline in interest income relating to certain asset-backed securities for which the expected cash flows and resulting yields are adjusted periodically. Within the commercial and industrial loan portfolio more than half of the decline in interest income was from lower variable sources, including prepayment fees and interest recoveries, with the remainder due to repricing of the portfolio offset by the benefit of growth. The majority of the decline in the net interest margin in third quarter 2011 was due to robust deposit growth from June 30, 2011. Much of this growth in deposits was invested in short-term assets, which had the effect of diluting the net interest margin.

Soft consumer loan demand and the impact of liquidating certain loan portfolios reduced average loans in third quarter 2011 to 67% (69% in the first nine months of 2011) of average earning assets from 71% in third quarter 2010 (73% in the first nine months of 2010). Average short-term investments and trading account assets were 12% of earning assets in both the third quarter and first nine months of 2011, up from 9% and 8%, respectively, for the same periods a year ago.

Core deposits are an important low-cost source of funding and thus impact both net interest income and the net interest margin. Core deposits include noninterest-bearing deposits, interest-bearing checking, savings certificates, certain market rate and other savings, and certain foreign deposits (Eurodollar sweep balances). Average core deposits rose to $836.8 billion in third quarter 2011 ($813.9 billion in the first nine months of 2011) from $772.0 billion in third quarter 2010 ($764.3 billion in the first nine months of 2010) and represented funding for average loans of 111% in the third quarter and 108% for the first nine months of 2011 (102% and 98% for the same periods of 2010.) Average core deposits increased to 75% and 74% of

average earning assets in the third quarter and first nine months of 2011, respectively compared with 72% for each respective period a year ago. The cost of these deposits declined significantly as the mix shifted from higher cost certificates of deposit to checking and savings products, which were also at lower yields relative to the third quarter and first nine months of 2010. About 92% of our average core deposits are in checking and savings deposits, one of the highest percentages in the industry.

In third quarter 2011, we called for redemption $5.8 billion of trust preferred securities with an average coupon rate of 8.45% that were redeemed in October 2011. Net interest income in fourth quarter 2011 is expected to benefit from the redemption of this high cost funding source.