The Heinz deal may indicate that Wells Fargo, seeking to expand its securities unit, is willing to offer larger loans to win more profitable advisory fees, Moody’s analysts led by Allen Tischler wrote in the report. Clients often demand debt financing before signing banks up as advisers, Moody’s said.

“It is often this desire to win the coveted advisory business that leads to underwriting commitments larger than those in which a bank might ordinarily engage,” Moody’s said. There’s a risk the bank can’t unload the debt after taking it onto the balance sheet, the ratings firm said, adding that it doesn’t expect that to be the case.

Wells Fargo Chief Executive Officer John Stumpf, 59, is bolstering the San Francisco-based bank’s securities business as he looks to boost revenue beyond traditional lending. In December, the lender moved the first of 900 traders and salespeople into a newly built trading floor in Charlotte, North Carolina, as it expands bond trading. The bank ranked fourth last year in U.S. syndicated loans, and places the same this year, according to data compiled by Bloomberg.

Risk Management

Wells Fargo, with JPMorgan Chase & Co., agreed to provide $14.1 billion to help finance the buyout of Heinz by Warren Buffett’s Berkshire Hathaway Inc. and Jorge Paulo Lemann’s 3G Capital Inc., according to a Feb. 15 filing from the Pittsburgh- based maker of ketchup and other food products. Both banks also served as advisers. Berkshire is Wells Fargo’s largest shareholder.

“We do not agree with Moody’s assertion that participation in capital markets activities necessarily leads to a higher risk profile,” Jessica Ong, a Wells Fargo spokeswoman, said in an e-mailed statement. “Wells Fargo has strong risk-management practices and a strong credit underwriting discipline and this transaction is fully in keeping with these disciplines and with our customer-focused business model.”

Wells Fargo shares on Monday fell 2.9 percent to close at $34.79 in New York, the most since November. The shares have gained 1.8 percent this year, lagging the 3.4 percent advance of the 24- company KBW Bank Index.

Retail Strength

Wells Fargo may also expand trading businesses to better distribute the debt it underwrites, which would erode the strength provided by the bank’s branch network, Moody’s said. Clients look at a bank’s ability to distribute debt through secondary-market trading when choosing among underwriters, the ratings firm said.

“We expect that the incentive to better serve its clients will remain an enticement for Wells Fargo to grow its secondary- trading capabilities, which would dilute the credit strengths of its very large retail operations,” Moody’s said.

The ratings firm also said it assumes Wells Fargo and JPMorgan structured the Heinz transaction to guard against a widening of credit spreads that would wipe out fees.

Moody’s assigns an A2 credit rating to Wells Fargo’s long- term debt, with a negative outlook.