US Bank 2008 Annual Report Download - page 122

Company Information
General Business Description U.S. Bancorp is a multi-state
financial services holding company headquartered in
Minneapolis, Minnesota. U.S. Bancorp was incorporated in
Delaware in 1929 and operates as a financial holding
company and a bank holding company under the Bank
Holding Company Act of 1956. U.S. Bancorp provides a full
range of financial services, including lending and depository
services, cash management, foreign exchange and trust and
investment management services. It also engages in credit
card services, merchant and ATM processing, mortgage
banking, insurance, brokerage and leasing.
U.S. Bancorp’s banking subsidiaries are engaged in the
general banking business, principally in domestic markets.
The subsidiaries range in size from $52 million to
$172 billion in deposits and provide a wide range of
products and services to individuals, businesses, institutional
organizations, governmental entities and other financial
institutions. Commercial and consumer lending services are
principally offered to customers within the Company’s
domestic markets, to domestic customers with foreign
operations and within certain niche national venues. Lending
services include traditional credit products as well as credit
card services, financing and import/export trade, asset-
backed lending, agricultural finance and other products.
Leasing products are offered through bank leasing
subsidiaries. Depository services include checking accounts,
savings accounts and time certificate contracts. Ancillary
services such as foreign exchange, treasury management and
receivable lock-box collection are provided to corporate
customers. U.S. Bancorp’s bank and trust subsidiaries
provide a full range of asset management and fiduciary
services for individuals, estates, foundations, business
corporations and charitable organizations.
U.S. Bancorp’s non-banking subsidiaries primarily offer
investment and insurance products to the Company’s
customers principally within its markets and mutual fund
processing services to a broad range of mutual funds.
Banking and investment services are provided through a
network of 2,791 banking offices principally operating in
24 states in the Midwest and West. The Company operates a
network of 4,897 branded ATMs and provides 24-hour,
seven day a week telephone customer service. Mortgage
banking services are provided through banking offices and
loan production offices throughout the Company’s markets.
Consumer lending products may be originated through
banking offices, indirect correspondents, brokers or other
lending sources, and a consumer finance division. The
Company is also one of the largest providers of Visa»
corporate and purchasing card services and corporate trust
services in the United States. A wholly-owned subsidiary,
Elavon, Inc. (“Elavon”), provides merchant processing
services directly to merchants and through a network of
banking affiliations. Affiliates of Elavon provide similar
merchant services in Canada and segments of Europe. These
foreign operations are not significant to the Company.
On a full-time equivalent basis, as of December 31,
2008, U.S. Bancorp employed 57,904 people.
Competition The commercial banking business is highly
competitive. Subsidiary banks compete with other
commercial banks and with other financial institutions,
including savings and loan associations, mutual savings
banks, finance companies, mortgage banking companies,
credit unions and investment companies. In recent years,
competition has increased from institutions not subject to
the same regulatory restrictions as domestic banks and bank
holding companies.
Government Policies The operations of the Company’s
various operating units are affected by state and federal
legislative changes and by policies of various regulatory
authorities, including those of the numerous states in which
they operate, the United States and foreign governments.
These policies include, for example, statutory maximum
legal lending rates, domestic monetary policies of the Board
of Governors of the Federal Reserve System, United States
fiscal policy, international currency regulations and
monetary policies, U.S. Patriot Act and capital adequacy and
liquidity constraints imposed by bank regulatory agencies.
Supervision and Regulation As a registered bank holding
company and financial holding company under the Bank
Holding Company Act, U.S. Bancorp is subject to the
supervision of, and regulation by, the Board of Governors of
the Federal Reserve System.
Under the Bank Holding Company Act, a financial
holding company may engage in banking, managing or
controlling banks, furnishing or performing services for
banks it controls, and conducting other financial activities.
U.S. Bancorp must obtain the prior approval of the Federal
Reserve Board before acquiring more than 5 percent of the
outstanding shares of another bank or bank holding
company, and must provide notice to, and in some situations
obtain the prior approval of, the Federal Reserve Board in
connection with engaging in, or acquiring more than
5 percent of the outstanding shares of a company engaged
in, a new financial activity.
Under the Bank Holding Company Act, U.S. Bancorp
may acquire banks throughout the United States, subject
only to state or federal deposit caps and state minimum age
requirements.
120 U.S. BANCORP