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U.S. Bank to Acquire the Corporate Trust and Institutional Custody Business from Wachovia

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 businesses."

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 expect.

"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 usbank.com.

Forward-Looking Statements

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
OR
U.S. Bank Investor Relations
Judith Murphy, 612-303-0783

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding U.S. Bancorp's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.



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