U.S. Bancorp (NYSE:USB) has announced that it will acquire the debt-servicing and securities custody services client portfolio from Japanese bank Mitsubishi UFJ Financial Group (OTC:MBFJ.F) for an undisclosed amount.
The portfolio includes roughly 600 client relationships and $320 billion in assets under custody and administration.
Gunjan Kedia, vice chair of U.S. Bancorp's wealth management and investment services division, said: "This transaction is a great fit for U.S. Bank. We are thrilled to have the opportunity to increase our presence on the West Coast and solidify our position as a leading provider of corporate trust, institutional trust, and fund custody services."
Custody services include the settlement, storage, and reporting of a client's securities and cash, and can enable clients to make additional income on their assets by loaning them out to approved borrowers.
U.S. Bancorp's investment services division has more than $7.7 trillion in assets under custody and administration globally.
The portfolio from Mitsubishi UFJ will help boost the bank's noninterest income revenue, which performed well in 2020 primarily because of mortgage banking fees from the refinancing boom.
U.S. Bancorp has now done a few deals in which it bought specific loan or business portfolios. Earlier in 2020, the bank acquired $1.2 billion of credit card loans as part of a new partnership with State Farm.
The deal is expected to close in the first quarter of 2021.