Can U.S. Bancorp (USB) Acquire Its Way to Megabank Status?

Outside the Midwest
If the search is expanded beyond the Midwest region, lots of possibilities emerge. Acquiring SunTrust Banks, Inc. (NYSE:STI) would add $173.4 billion in assets  to the balance sheet, as well as expand U.S. Bancorp’s reach to the Southeast United States. Adding M&T Bank Corporation (NYSE:MTB) would add $83 billion in total assets, as well as extend U.S. Bancorp into New England because of M&T Bank’s acquisition of Hudson City Bancorp last year. This combined entity would have over $610 billion in total assets, still far behind Wells Fargo and its $1.4 trillion in total assets.

What this all means
Going into this, I truly thought U.S. Bancorp could somehow approach the total assets of the four largest banks without much difficulty simply by acquiring other banks. Instead, this silly experiment further backed up my belief that the megabanks are entirely too big in their present state. The “smallest” of the four, Wells Fargo, still has over four times the amount of total assets that U.S. Bancorp does, and the discrepancy gets even larger as you move further up the list. Because it will be so difficult for U.S. Bancorp to join the ranks of “too big to fail,” I think it should simply continue doing what it does and be the best regional bank in the country.

The article Can U.S. Bancorp Acquire Its Way to Megabank Status? originally appeared on Fool.com and is written by Robert Eberhard.

Fool contributor Robert Eberhard has no position in any stocks mentioned. The Motley Fool recommends Wells Fargo. The Motley Fool owns shares of Bank of America, Citigroup, Fifth Third Bancorp, JPMorgan Chase, and Wells Fargo.

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