Wells Fargo & Co said on Tuesday former Chief Executive Dick Kovacevich will retire as chairman on January 1 and current Chief Executive John Stumpf will take on the added role.

Kovacevich, who will be leaving after 23 years with the San Francisco-based bank, last year agreed to stay on as chairman for an interim period past his retirement age while Wells dealt with its acquisition of troubled bank Wachovia Corp.

The bank's board in November granted an exception to its mandatory retirement age of 65 for senior executives to allow Kovacevich to stay on -- he will be 66 next month -- and said at the same time that Stumpf would replace him on his retirement.

Stumpf, 56, became chief executive two years ago and oversaw the acquisition of Charlotte, North Carolina-based Wachovia on December 31.

Shares in Wells Fargo were up $1.11 or 3.9 percent at $29.40 in afternoon trading on the New York Stock Exchange.

(Reporting by Elinor Comlay, editing by Leslie Gevirtz)