U.S. Bancorp Gains on Snapping Up MUFG Union Bank’s Retail Business By Investing.com
By Dhirendra Tripathi
Investing.com – U.S. Bancorp stock (NYSE:) traded 2.5% higher Tuesday as it agreed to acquire MUFG Union Bank’s core retail banking operations from Japan’s Mitsubishi UFJ Financial Group (NYSE:) to expand its presence on the West Coast.
U.S. Bancorp has agreed to purchase MUFGUnion Bank for $8 billion. This includes $5.5 billion cash and 44 million shares U.S. Bancorp stock.
MUFG will have a 2.9% share in American bank after the closing of the transaction. The transaction excludes the purchase of MUFG Union Bank’s global corporate & investment bank, certain middle and back-office functions, and other assets, a note by U.S. Bancorp said.
U.S. Bancorp will gain an additional 1 million customers, 190,000. small-business customers along the West Coast and approximately $58 billion worth of loans.
U.S. Bancorp claims that the merger will result in earnings growth of 6% by 2023. It expects to also incur $1.2 billion in merger fees. According to the bank, the transaction should close by the end of the first quarter 2022.
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