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Not quite a bank for the entire US, U.S. Bancorp is nonetheless one of the ten largest bank holding companies in the country. It owns U.S. Bank and other subsidiaries that provide consumer and commercial loans, deposits, and credit cards, as well as merchant processing, mortgage banking, trust and investment management, brokerage services, insurance, and corporate payments. The bank has more than 3,000 branches and 5,000 ATMs in some two dozen states in the Midwest and West, including one of the most extensive networks of branches inside grocery stores. California is its largest market.
U.S. Bancorp has grown in recent years by scooping up failed banks that were brought down by the economy and seized by regulators. The strategy has allowed the company to add branches, deposits, loans, and customers relatively cheaply, and have helped boost its bottom line. U.S. Bancorp reported record net income in 2010 and 2011, in addition to deposit and loan growth. The company was also able to reduce its amount of nonperforming assets as the US economy showed signs of improvement following the credit crisis.
U.S. Bancorp expanded in Tennessee through the 2012 acquisition of the banking operations of BankEast in an FDIC-assisted deal. In 2011 U.S. Bank established a presence in New Mexico through the acquisition of the banking operations of the failed First Community Bank. That FDIC-facilitated transaction, which added nearly 40 branches, did not include any assets of that company’s parent, First State Bancorporation. In 2010 U.S. Bancorp bought deposits and some branches in Nevada from BB&T, which had acquired the operations from the failed Colonial BancGroup.
In 2009 U.S. Bancorp acquired the nine banking subsidiaries of the failed FBOP Corporation; the deal, also facilitated by the FDIC, added some 150 locations in Arizona, California, and Illinois to U.S. Bank’s network. The company acquired the banking operations of the failed California-based banks Downey Savings & Loan and PFF Bank & Trust in FDIC-assisted transactions in late 2008.
U.S. Bancorp has also been expanding its fee-based services such as treasury management, corporate trust, institutional custody, merchant processing, and freight payment services. The company is also one of the largest providers of corporate credit cards and payment services to the US government. Its largest fee-gathering subsidiary is Elavon, a leading processor of merchant credit card transactions in the US, Canada, Latin America, and Europe. U.S. Bancorp has also been growing this business through acquisitions and is looking to expand internationally.
In 2009 U.S. Bank acquired the corporate trust bond administration business of AmeriServ Financial and the bond trustee business of First Citizens Bancshares. It bought the corporate trust administration business of F.N.B. Corporation and the securitization trust administration business of Bank of America the following year. The acquisitions raised the bank’s corporate trust assets under administration to around $3 trillion.
In 2012 U.S. Bank made a similar deal when it agreed to buy Union Bank’s institutional trust business, adding some 4,300 client relationships representing $42 billion in assets under administration. It also bought the Indiana-based corporate trust business of UMB Bank that year.
In 2011 U.S. Bancorp finalized the sale of its FAF Advisors asset management subsidiary to Nuveen Investments in exchange for a nearly 10% stake in Nuveen.
Warren Buffett’s Berkshire Hathaway owns about 4% of U.S. Bancorp. –