U.S. Bancorp to Buy Deutsche Bank’s Bond Trustee Biz
U.S. Bancorp said Monday that it has agreed to buy the municipal bond trustee business of Deutsche Bank—a deal that will add roughly $57 billion to the more than $3 trillion in assets already under administration within the corporate trust division of its commercial banking subsidiary, U.S. Bank.
Financial terms of the deal, which is expected to close in the third quarter of this year, were not disclosed.
U.S. Bank Global Corporate Trust Services serves public and private companies, government and tax-exempt entities, and financial services companies. It operates a network of 48 domestic offices and three international locations—in Buenos Aires, Argentina; London; and Dublin, Ireland.
U.S. Bancorp said that it now has about 125,000 trust and agency contracts, and the Deutsche Bank deal will add an additional 1,100. The acquisition will build on its trust business in California, Mississippi, New York, Tennessee, and Texas.
“This transaction complements the existing U.S. Bank municipal bond trustee business and will further strengthen our position as the number one provider of municipal trustee and agency services in the nation,” Bryan Calder, president of U.S. Bank Global Corporate Trust Services, said in a statement. “This acquisition is consistent with U.S. Bank’s ongoing commitment to continued strategic business investments and its commitment to corporate trust services.”
According to Bloomberg, U.S. Bancorp CEO Richard Davis has said that part of the company’s acquisition strategy will focus on its payments and trust business. U.S. Bancorp added about $25 billion in hedge-fund assets under administration through its November purchase of AIS Fund Administration, which provides fund administration and related services to alternative investment managers.
In 2012, U.S. Bancorp’s trust and investment-management fees increased 5.5 percent to $1.06 billion, as compared to 2011.
U.S. Bancorp is Minnesota’s largest bank-holding company based on assets, which totaled $351.3 billion as of December 31.