Posted by: Ben Steverman on June 16, 2008
Wall Street might begin to feel the impact of the devastating and tragic flooding in the Midwest. And I’m not just talking about indirect effects, like damage to Midwestern states’ economies and higher food prices.
The San Francisco-based bank was the second largest underwriter of crop insurance by market share for the last three years. Wells Fargo’s 16.7% market share in 2007 was second only to ACE Ltd. (ACE), Stifel analysts say. Rounding out the top five crop insurers are NAU Country Insurance Co. (a private company), American Financial Insurance Group (AFG) and the German-owned Allianz Insurance Group.
It will take some time to find out if any or all of these firms have serious exposure to the flooded areas in Iowa and elsewhere. On Monday afternoon, none of these firms’ stock prices seemed affected by the possible danger. In fact, Wells Fargo shares were up more than 2% at one point Monday.