MINNEAPOLIS--(BUSINESS WIRE)--Jan. 27, 2012--
U.S. Bancorp (NYSE: USB) announced today that, effective immediately,
its lead bank, U.S. Bank National Association, has acquired the banking
operations of BankEast, a subsidiary of BankEast Corporation, from the
Federal Deposit Insurance Corporation (FDIC). BankEast is based in
U.S. Bank will receive approximately $272 million of assets and assume
$268 million of insured and uninsured deposits of BankEast.
“This acquisition extends U.S. Bank's banking franchise in the
attractive Tennessee market,” said John Elmore, executive vice president
of community banking at U.S. Bank. “It is a great fit for both companies
since U.S. Bank and BankEast share a similar community banking model
which includes local decision making, strong community involvement and
leadership combined with the consumer and business banking products and
services of the nation’s fifth largest bank.”
Elmore noted that BankEast’s 10 branches in the Knoxville area will
bring U.S. Bank’s total branch count in Tennessee to 91, and that U.S.
Bank intends to continue to expand organically in the state. BankEast
customers will soon benefit from U.S. Bank’s extensive mix of products
U.S. Bank already employs more than 1,100 people in the Knoxville area,
primarily through its customer service center for its merchant
processing subsidiary, Elavon.
The acquisition of the banking operations of BankEast is structured as a
whole bank purchase and assumption transaction without a loss share
agreement. U.S. Bank conducted extensive credit due diligence, and
purchased BankEast for an asset discount of approximately $67.5 million.
The transaction is expected to exceed all internal hurdles for financial
returns with conservative loan loss assumptions.
All BankEast branches will continue to operate under their current name
and will be re-branded as U.S. Bank branches in the near future.
BankEast customers should continue to conduct their banking as they have
in the past. U.S. Bank will soon be providing additional information to
customers about this transaction. BankEast customer deposits are now
backed by the financial strength and security of U.S. Bank.
If BankEast customers have any questions regarding their accounts
involved in this transaction, they should contact their local branch,
or use their typical customer service channels.
U.S. Bancorp (NYSE: USB), with $340 billion in assets as of Dec. 31,
2011, is the parent company of U.S. Bank, the fifth-largest commercial
bank in the United States. The company operates 3,085 banking offices in
25 states and 5,053 ATMs, and provides a comprehensive line of banking,
brokerage, insurance, investment, mortgage, trust and payment services
products to consumers, businesses and institutions. U.S. Bancorp and its
employees are dedicated to improving the communities they serve, for
which the company earned the 2011 Spirit of America Award, the highest
honor bestowed on a company by United Way. Visit U.S. Bancorp on the web
The following information appears in accordance with the Private
Securities Litigation Reform Act of 1995:
This press release contains forward-looking statements about U.S.
Bancorp. Statements that are not historical or current facts, including
statements about beliefs and expectations, are forward-looking
statements and are based on the information available to, and
assumptions and estimates made by, management as of the date made. These
forward-looking statements cover, among other things, anticipated future
revenue and expenses and the future plans and prospects of U.S. Bancorp.
Forward-looking statements involve inherent risks and uncertainties, and
important factors could cause actual results to differ materially from
those anticipated. Global and domestic economies could fail to recover
from the recent economic downturn or could experience another severe
contraction, which could adversely affect U.S. Bancorp's revenues and
the values of its assets and liabilities. Global financial markets could
experience a recurrence of significant turbulence, which could reduce
the availability of funding to certain financial institutions and lead
to a tightening of credit, a reduction of business activity, and
increased market volatility. Continued stress in the commercial real
estate markets, as well as a delay or failure of recovery in the
residential real estate markets, could cause additional credit losses
and deterioration in asset values. In addition, U.S. Bancorp's business
and financial performance is likely to be negatively impacted by effects
of recently enacted and future legislation and regulation. U.S.
Bancorp's results could also be adversely affected by continued
deterioration in general business and economic conditions; changes in
interest rates; deterioration in the credit quality of its loan
portfolios or in the value of the collateral securing those loans;
deterioration in the value of securities held in its investment
securities portfolio; legal and regulatory developments; increased
competition from both banks and non-banks; changes in customer behavior
and preferences; effects of mergers and acquisitions and related
integration; effects of critical accounting policies and judgments; and
management's ability to effectively manage credit risk, residual value
risk, market risk, operational risk, interest rate risk and liquidity
risk. Finally, there can be no assurance that we will realize the
anticipated benefits of the BankEast acquisition.
For discussion of these and other risks that may cause actual results to
differ from expectations, refer to U.S. Bancorp's Annual Report on Form
10-K for the year ended December 31, 2010, on file with the Securities
and Exchange Commission, including the sections entitled "Risk Factors"
and "Corporate Risk Profile" contained in Exhibit 13, and all subsequent
filings with the Securities and Exchange Commission under Sections
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934.
Forward-looking statements speak only as of the date they are made, and
U.S. Bancorp undertakes no obligation to update them in light of new
information or future events.
Source: U.S. Bancorp
Tom Joyce (Media), 612-303-3167
Murphy (Analysts), 612-303-0783