Alternatives might be refinancing the loan or postponing one or more payments.  The bank makes decisions to change loan terms on a case-by-case basis. If a mortgage has been sold to outside investors, the bank must get their agreement to rewrite terms, Stumpf noted. In 2006, Wells Fargo made $27.9 billion in subprime mortgages, loans to borrowers who couldn't meet credit standards for traditional mortgages, according to Inside Mortgage Finance, a trade publication. Lending experts say that Wells' policy appears flexible, but the message is sometimes not getting to employees, some of whom are taking hard lines with borrowers.

"What's happening on the ground is not 100 percent consistent with policy," said Kevin Stein, associate director of the California Reinvestment Coalition. "They have a lot of people in loan servicing and it's not clear that all of them understand what Mr. Stumpf told you." Responsibility for mortgage abuses is widely shared, Stumpf said. But he defended Wells' policies, stressing the bank's refusal to make some of the most problem-ridden types of loans, such as those with starter rates so low that principal increased rather than got paid down. "We've been responsible and we didn't do certain things," Stumpf said. "Our teasers were not very tantalizing compared to the industry." On other matters, Stumpf said the August national employment report released Friday, which showed U.S. payrolls shrinking by 4,000 jobs, means there is a 70 to 80 percent chance that the Federal Reserve will trim short-term interest rates at its policy meeting later this month.