U.S. Bank, one of the leading credit card issuers in the country, is further increasing its credit card portfolio. The bank has been all over the news recently for its credit cards. These stories include the devaluing of FlexPerks and the removal of existing FlexPerks cards for two new Altitude Credit cards. The bank continues its credit maneuvering, this time taking over State Farm credit cards and key banking services.
U.S. Bank’s Increasing Banking Portfolio
U.S. Bank’s acquisition of State Farm’s essential banking portfolio is the latest step in the ongoing exit of State Farm from the banking sector. State Farm, which offers currently several credit cards, will also turn over their banking deposit operations.
The move sees U.S. Bank take over $16.9 billion in banking assets from State Farm. Those assets were enough to make State Farm the 100th largest bank in the country as of 2019, although considerably behind U.S. Bank’s $500 billion in assets.
While the acquisition of State Farm banking operations by U.S. Bank isn’t a big deal financially, it does increase the banking profile of the Minneapolis-based bank. U.S. Bank currently operates in 26 states. By capturing the banking operations of State Farm, however, the bank increases its banking presence nationwide.
“Mostly About Innovation”
Tim Welsh, vice chairman of consumer and business banking for U.S. Bancorp, says the move is all about the customers. “This is mostly about innovation, trying to do things in new and different ways for customers,” he said in a statement.
State Farm Spokesman Roszell Gadson also echoed many of the same sentiments. “The financial-services industry is highly competitive and rapidly changing. Combining our deep customer relationships with the scale and capabilities of other financial organizations provides us the opportunity to help significantly more customers,” he said.
Business as Usual for State Farm Credit Cardholders
If financial regulators approve the banking alliance, U.S. Bank will take over State Farm deposits and credit card accounts starting in the Fall of 2020. The plan is for U.S. Bank and State Farm to issue dual-branded credit cards. This likely means that existing State Farm cardholders won’t have anything to worry about.
State Farm currently offers four credit cards:
- Rewards Visa
- Good Neighbor Visa
- Student Visa
- Business Visa
About U.S. Bank
U.S. Bank is the fifth-largest bank in the United States, with over $500 billion in assets. The bank provides banking services for businesses and consumers. These services include investments, mortgages, trusts, and payment services. The bank also offers credit cards for businesses and consumers, including dozens of co-branded U.S. Bank credit cards with names like Kroger, Korean Air, and Radisson.
About State Farm
State Farm is the largest property and casualty insurer in the U.S, as well as the nation’s largest auto insurer. The company, with its headquarters in Bloomfield, Illinois, currently features over 19,000 agents in 343 claims offices across the country.
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