The Most Powerful Women in Finance: No. 15, Kara McShane, Wells Fargo

As global head of commercial real estate for Wells Fargo , Kara McShane faces industry disruption on a daily basis.

High interest rates have raised financing costs, leading to a decline in transaction volume for real estate. There also has been a decline in the issuance of commercial mortgage-backed securities.

Despite stiff headwinds, McShane has found opportunities to grow market share for Wells Fargo and stay a step ahead of the risks.

Under her guidance, Wells Fargo became No. 1 in real estate investment banking for the first time, achieving a market share of 15.2%, according to Dealogic. Helping drive success was Wells Fargo's recognition of a gap between public company and private real estate valuations, which led to increased M&A transactions, though the gap closed over the summer.

McShane and her team also made progress over the last year on reducing the bank's exposure to office space, considered among the riskier sectors of commercial real estate coming out of the COVID-19 pandemic. She implemented a series of "deep-dive" management routines that gave her team real-time insights into the bank's commercial real estate portfolio, allowing her team to better anticipate and manage risks.

The routines involve a loan-by-loan analysis into areas of the portfolio where the bank believes it has the most risk, McShane said. "For those loans, we take the extra step to determine what we think the underlying value of the property is every quarter. We do a thorough analysis to determine how an owner would value the property today, how much capital they would need to invest in order to stabilize the asset and what return would they need on their investment."

McShane sees additional progress in how well the $1.9 trillion-asset bank is improving the client coverage experience. "We've listened to our clients and changed our approach to how we deliver for them in a more cohesive way across all of our products and services," she said.

McShane also has tweaked her approach to recruiting and interviewing for her leadership team, resulting in greater diversity. Her operating committee is more than 60% gender and racially diverse, up from 10% when she became head of commercial real estate.

The results stem from her efforts to search outside the usual places for talent. That includes a look further down the organizational chart and a willingness to give chances to up-and-coming leaders who are ready for more, as well as support for efforts to broaden the pipeline of talent coming into Wells Fargo. She works regularly to engage with historically Black colleges and universities and Hispanic-serving institutions.

"For me, it is and always has been about finding the best person for the job and doing the right thing," said McShane, who is executive sponsor of the diversity, equity and inclusion council for Wells Fargo's corporate and investment bank.

McShane also is on the board of Breaking Ground, a nonprofit that provides housing and other services to homeless and other vulnerable populations in New York City. In 2023, the nonprofit recognized her, alongside New York Gov. Kathy Hochul, for her contributions and volunteer work