This transaction expands U.S. Bank's footprint and distribution in rapidly growing and demographically attractive community markets in western Colorado and adds to the company's existing base in Denver. U.S. Bank has a history of very successful fill-in market acquisitions of this type and management views the integration related to this acquisition as low risk. U.S. Bank and WestStar Bank have similar community banking models that will help ensure a smooth transition.
John R. Elmore, executive vice president of community banking for U.S. Bank, said, "The addition of 23 WestStar Bank branches, which will be renamed as U.S. Bank branches in December 2006, strengthens our presence and provides an entry into important fast-growing communities in western Colorado. Customers will continue to use their same checks and credit cards, unless otherwise notified, and bank at the same branch locations. Customers will be served by the same familiar banking professionals who helped them with their financial needs in the past."
To ensure a seamless transition, E.B. Chester, the former chairman of Vail Banks, Inc., will serve as the head of U.S. Bank's Western Slope regional advisory board. The new combined regional advisory board will include all former WestStar Bank markets, excluding Denver, and current U.S. Bank markets in the Western Slope area of Colorado.
Terms of the agreement included a total cash purchase price of approximately $98.6 million, or $17.00 for each share of Vail Banks, Inc. common stock, which represents a premium to core deposits of 13.7 percent.
"We will be communicating directly with our new customers as we introduce U.S. Bank products and expanded services to WestStar Bank customers," noted Elmore. "In addition to introducing our strong focus on customer service, U.S. Bank customers throughout our new western Colorado markets will begin to benefit from a host of new consumer, commercial and trust financial services and products."
Historically, WestStar Bank was a small and middle market commercial bank primarily focused on commercial real estate, construction and small business lending. The 23 WestStar Bank branches consist of 20 locations in the Western Slope region of Colorado and three branches in the Denver area.
This acquisition includes 21 WestStar Bank ATM locations that will increase U.S. Bank's ATM network in Colorado to more than 250 convenient locations. The 23 WestStar Bank locations, which will be converted to U.S. Bank offices are located in following 19 Colorado communities: Aspen, Avon, Breckenridge, Cedaredge, Delta, Denver (three locations), Dillon, Edwards, Estes Park, Frisco, Fruita, Glenwood Springs, Granby, Grand Junction, Gypsum, Montrose, Norwood, Telluride and Vail (two locations). U.S. Bank now has 135 branch locations and total deposits of approximately $7 billion in Colorado with the completion of this acquisition.
U.S. Bancorp, with assets of $213 billion, is the 6th largest financial holding company in the United States. The company operates 2,434 banking offices and 4,966 ATMs, and provides a comprehensive line of banking, brokerage, insurance, investment, mortgage, trust and payment services products to consumers, businesses and institutions. U.S. Bancorp is the parent company of U.S. Bank. Visit U.S. Bancorp on the web at www.usbank.com.
This news release contains forward-looking statements about U.S. Bancorp. Statements that are not historical or current facts, including statements about beliefs and expectations, are forward-looking statements. These statements often include the words "may," "could," "would," "should," "believes," "expects," "anticipates," "estimates," "intends," "plans," "targets," "potentially," "probably," "projects," "outlook" or similar expressions. These forward-looking statements cover, among other things, anticipated future revenue and expenses and the future plans and prospects of U.S. Bancorp. Forward-looking statements involve inherent risks and uncertainties, and many factors could cause actual results to differ materially from those anticipated, including those described in U.S. Bancorp's Annual Report on Form 10-K for the year ended December 31, 2005, which you should read carefully, as well as the company's other filings with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made, and U.S. Bancorp undertakes no obligation to update them in light of new information or future events.