MINNEAPOLIS, Nov 29, 2005 (BUSINESS WIRE) -- U.S. Bancorp (NYSE:USB) announced today that its lead
bank, U.S. Bank, N.A., has entered into a definitive agreement to
purchase the corporate trust and institutional custody businesses of
Wachovia Corporation (NYSE:WB). As a result of this transaction, U.S.
Bank Corporate Trust Services will acquire approximately 14,100 new
client issuances and $410 billion in assets under administration and
U.S. Bank Institutional Trust & Custody will acquire approximately
1,700 new clients and $570 billion in assets under administration.
Jerry Grundhofer, chairman and chief executive officer of U.S.
Bancorp, noted, "This transaction solidifies U.S. Bank as a top
corporate bond trustee and makes us more competitive by increasing our
existing scale and leveraging our industry leading technology and
operational platforms. It is consistent with U.S. Bancorp's
acquisition strategy of purchasing fee-based niche businesses.
Further, this transaction illustrates our dedication to expanding the
distribution and product offerings in the payments and fiduciary
This transaction clearly affirms U.S. Bank as a leader in the
corporate trust industry - the largest trustee in the area of
tax-exempt debt, the second largest in the area of asset-backed and
mortgage-backed securities, and the third largest in new corporate
bond issuances. The acquisition of the institutional custody business
provides U.S. Bank with significant scale and makes U.S. Bank the
ninth-largest institutional custody provider.
Under the terms of the agreement, the transaction has a $720
million initial cash purchase price with up to an additional $80
million payable within one year based on business retention levels.
The transaction enhances the corporate trust offices in six current
locations and adds 19 new corporate trust offices and institutional
custody offices primarily in the mid-Atlantic and southeastern states.
With U.S. Bank's history of successful mergers, the company is
committed to ensuring a smooth transition. Conversion and integration
risks are minimized since U.S. Bank and Wachovia utilize similar
technology platforms and employ many of the same key vendors.
Following the receipt of regulatory clearances and consummation of the
transaction, U.S. Bank is committed to providing its new customers
with the same high level of quality services that current U.S. Bank
corporate trust and institutional custody customers have come to
"U.S. Bank has a strong, proven track record in this business and
will continue to provide outstanding services to our corporate trust
and institutional custody clients," said David Carroll, president of
Wachovia's Capital Management Group.
U.S. Bank currently has 31 corporate trust offices across the
country and offers a complete line of trust services. U.S. Bank serves
as trustee and paying agent for the issuance of taxable and
non-taxable securities, including the review of documents and
indentures, registration, and authentication of bonds, receipts and
disbursement of bond sale proceeds, successor trusteeships, escrow
account services and transfer and paying agency services. Also, U.S.
Bank provides mortgage-backed and asset-backed securitizations, money
market paying agency services, bond and tax administration and
document custody services.
U.S. Bank currently has 36 institutional trust & custody offices
in 24 states focusing on trust and custody services, retirement,
investment and health savings accounts for institutional clients. Its
product offerings include retirement plans (401(k), profit sharing or
money purchase pension plans and defined benefit), institutional trust
and custody, master trust services and health savings accounts.
Additional information regarding this transaction can be found on
U.S Bancorp's website. To access the information, go to usbank.com and
click on "About U.S. Bancorp" and then "Investor/Shareholder
Information." The link to a slide presentation can be found under both
"Press Releases" and "Webcasts and Presentations."
U.S. Bancorp, with assets of $207 billion, is the 6th largest
financial holding company in the United States. The company operates
2,411 bank offices and 4,999 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 is the home of the Five Star Service Guarantee which
assures customers of certain key banking benefits and services or
customers will be paid for their inconvenience. U.S. Bancorp is the
parent company of U.S. Bank. Visit U.S. Bancorp on the web at
This press release contains forward-looking statements. Statements
that are not historical or current facts, including statements about
beliefs and expectations, are forward-looking statements. These
statements often include the words "may," "could," "would," "should,"
"believes," "expects," "anticipates," "estimates," "intends," "plans,"
"targets," "potentially," "probably," "projects," "outlook" or similar
expressions. These forward-looking statements cover, among other
things, anticipated future revenue and expenses and the future
prospects of the Company. Forward-looking statements involve inherent
risks and uncertainties, and important factors could cause actual
results to differ materially from those anticipated, including the
following, in addition to those contained in the Company's reports on
file with the SEC: (i) general economic or industry conditions could
be less favorable than expected, resulting in a deterioration in
credit quality, a change in the allowance for credit losses, or a
reduced demand for credit or fee-based products and services; (ii)
changes in the domestic interest rate environment could reduce net
interest income and could increase credit losses; (iii) inflation,
changes in securities market conditions and monetary fluctuations
could adversely affect the value or credit quality of the Company's
assets, or the availability and terms of funding necessary to meet the
Company's liquidity needs; (iv) changes in the extensive laws,
regulations and policies governing financial services companies could
alter the Company's business environment or affect operations; (v) the
potential need to adapt to industry changes in information technology
systems, on which the Company is highly dependent, could present
operational issues or require significant capital spending; (vi)
competitive pressures could intensify and affect the Company's
profitability, including as a result of continued industry
consolidation, the increased availability of financial services from
non-banks, technological developments, or bank regulatory reform;
(vii) changes in consumer spending and savings habits could adversely
affect the Company's results of operations; (viii) changes in the
financial performance and condition of the Company's borrowers could
negatively affect repayment of such borrowers' loans; (ix)
acquisitions may not produce revenue enhancements or cost savings at
levels or within time frames originally anticipated, or may result in
unforeseen integration difficulties; (x) capital investments in the
Company's businesses may not produce expected growth in earnings
anticipated at the time of the expenditure; and (xi) acts or threats
of terrorism, and/or political and military actions taken by the U.S.
or other governments in response to acts or threats of terrorism or
otherwise could adversely affect general economic or industry
conditions. Forward-looking statements speak only as of the date they
are made, and the Company undertakes no obligation to update them in
light of new information or future events.
SOURCE: U.S. Bancorp
U.S. Bank Media Relations
Steve Dale, 612-303-0784
U.S. Bank Investor Relations
Judith Murphy, 612-303-0783