US Bank 2001 Annual Report Download - page 62

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The adequacy of the accrued liabilities is reviewed reÖect a lower utilization of beneÑts by aÅected staÅ,
regularly taking into consideration actual and projected changes in initial assumptions as a result of subsequent
payments. Adjustments are made to increase or decrease mergers and alterations of business plans.
these accruals as needed. Reversals of expenses can
The following table presents a summary of activity with respect to the merger of Firstar and USBM:
Severance Lease Systems
and Cancellation Balance Conversions
Employee- Investment and Related Sheet and
(Dollars in Millions) related Banker Fees WriteoÅs Restructurings Integration Other(a) Total
Balance at December 31, 2000 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ Ì $ Ì $ Ì $ Ì $ Ì $ Ì $ Ì
Provision charged to operating expense ÏÏ 268.2 66.2 48.7 457.6 208.1 118.4 1,167.2
Cash outlays ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (175.6) (65.7) (5.2) Ì (208.1) (77.9) (532.5)
Non-cash write-downs and other ÏÏÏÏÏÏÏÏÏ (4.3) .3 (10.4) (455.5) Ì (40.5) (510.4)
Balance at December 31, 2001 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 88.3 $ .8 $ 33.1 $ 2.1 $ Ì $ Ì $ 124.3
(a) Other accruable merger and restructuring-related items included charitable contributions of $76.0 million, a branch sale gain of ($62.2) million, $20.0 million to consolidate and
rationalize the branch network, capitalized software impairments of $81.7 million, and other charges of $2.9 million.
The components of the merger and restructuring-related In connection with the merger of Firstar and USBM,
accruals for all acquisitions were as follows: management estimates the Company will incur pre-tax
merger-related charges of approximately $271.1 million in
December 31
(Dollars in Millions) 2001 2000 2002. These are currently estimated to include $14.0 million
in employee-related costs, $170.9 million for conversions of
Severance ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $106.3 $13.8
Other employee-related costs ÏÏÏÏÏÏÏÏ 4.7 6.8 systems and consolidation of operations, $57.8 million in
Lease termination and facility costs ÏÏÏ 64.3 8.4 occupancy and equipment charges (elimination of duplicate
Contracts and system write-oÅs ÏÏÏÏÏÏ 18.3 7.4 facilities and write-oÅ of equipment) and $28.4 million in
OtherÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 11.8 13.4 other merger-related costs (including legal fees, balance
Total ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $205.4 $49.8 sheet restructuring charges and other costs).
With respect to the NOVA acquisition, the Company
The merger and restructuring-related accrual by signiÑcant expects to incur approximately $68.3 million of merger-
acquisition or business restructuring was as follows: related charges through 2003. The Piper Restructuring was
December 31 substantially completed by December 31, 2001. In addition,
(Dollars in Millions) 2001 2000 the Company anticipates an additional $15.1 million of
USBMÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $124.3 $ Ì merger-related expenses in 2002 as a result of other
NOVA ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 48.4 Ì acquisitions.
Piper JaÅray Companies, Inc. ÏÏÏÏÏÏÏÏ 20.8 15.0
PaciÑc Century Bank ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 3.1 Ì Restrictions on Cash and Due from
Lyon Financial Services, Inc. ÏÏÏÏÏÏÏÏÏ 1.0 2.7
Banks
Western BancorpÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì 5.1
Scripps Financial Corporation ÏÏÏÏÏÏÏÏ Ì 4.6 Bank subsidiaries are required to maintain minimum average
Bank of CommerceÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì 4.1
reserve balances with the Federal Reserve Bank. The
Peninsula Bank ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì 3.0
Other acquisitions ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 7.8 15.3 amount of those reserve balances was approximately
$916 million at December 31, 2001.
Total ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $205.4 $49.8
U.S. Bancorp
Note 5
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