U.S. Bank Buys Bank of America Trust Businesses
U.S. Bank, National Association has agreed to buy two of the securitization and trust businesses of Bank of America, NA.
U.S. Bancorp, the Minneapolis-based parent company of U.S. Bank, said Monday that the bank intends to purchase Bank of America's domestic and European-based securitization and trust businesses.
In a presentation to investors, U.S. Bank said that the cash purchase price will be “up to $35 million” and that the acquisition will add more than $100 million in annual revenue.
Through the transaction, U.S. Bank's corporate trust services segment will acquire 2,153 active securitization and related transactions, more than 2.4 million residential mortgage files and 84,000 commercial files, $1.1 trillion in assets under administration, and four offices-two in the United States and two in Europe. The deal also will provide U.S. Bank with about $10.5 billion worth of deposits.
U.S. Bank said that one-time merger expenses are anticipated to total between $40 million and $45 million.
The transaction is expected to close next month. Going forward, the acquired businesses will operate under the U.S. Bank trade name.
“This transaction not only affirms U.S. Bank as a leader in the corporate trust industry, it strengthens its strong positions in collateralized debt obligations and commercial and residential mortgage-backed securitizations,” Terrance Dolan, vice chairman of wealth management and securities services at U.S. Bancorp, said in a statement. “The transaction also establishes a U.S. Bank Corporate Trust Services presence in Europe with offices in Ireland and London, England, while significantly enhancing the U.S. Bank corporate trust presence in Chicago.”
U.S. Bank now has 48 corporate trust offices across the country. It provides trustee, calculation agent, and custodial services for mortgage-backed, asset-backed, and collateralized debt obligation securitizations. U.S. Bank also serves as trustee and paying agent for the issuance of taxable and non-taxable securities, money market paying agent services, and escrow services.
U.S. Bancorp is Minnesota's largest bank holding company based on assets, which totaled $291 billion as of September 30. U.S. Bank operates 3,013 banking offices in 24 states.