U.S. Bancorp continued the push to expand its trust business Friday, unveiling a deal for the municipal bond trust business of ABN Amro Holding NV's LaSalle Bank Corp. in Chicago.
The Minneapolis banking company said in a press release that the deal, which is expected to close by yearend, would build its corporate trust presence in the Midwest by adding about 2,875 client bond issues and assets under administration of $30 billion. It did not say how much it would pay.
In an interview Friday, Diane Thormodsgard, the president of U.S. Bancorp's corporate trust and institutional trust and custody services, said the deal "complements and strengthens our corporate trust business" in Michigan and Illinois. After the closing, U.S. Bancorp's corporate trust division would have $2.5 trillion of assets under administration, 725,000 bondholders, and more than 95,500 client bond issues.
U.S. Bancorp completed in September its purchase of SunTrust Banks Inc.'s municipal and corporate trust business, which added assets of $123 billion under administration and about 4,700 client bond issues. Several months earlier it bought Wachovia Corp.'s corporate trust unit.
In a report Friday Scott Siefers of Sandler O'Neill & Partners LP reiterated his "buy" rating on U.S. Bancorp, saying the deal is consistent with the company's desire "to increase its penetration in certain fee-based businesses (particularly payments and fiduciary businesses)." "Additionally, the overall size is certainly digestible," he wrote, "and USB has successfully integrated similar deals in the past."
