U.S. Bancorp in no hurry for bank deals in 'buyer's market'

U.S. Bancorp, the Minneapolis-based bank that has acquired failed lenders, doesn't need to rush into more acquisitions given "a buyer's market," said Chief Executive Officer Richard Davis.

"Waiting, for us, is the best thing possible, because it only gets more attractive," Davis said today during a New York investor conference sponsored by Bank of America Corp. "Why would we take on a whole company transaction, with all of the risks that we can only guess about, when there are potentially FDIC deals with loss-sharing?"

The FDIC describes loss-sharing this way: "Under loss sharing, the FDIC agrees to absorb a significant portion of the loss--typically 80 percent--on a specified pool of assets while offering even greater loss protection in the event of financial catastrophe, and the acquiring bank is liable for the remaining portion of the loss."

Davis, 52, oversaw the lender's purchases of failed banks and thrifts with assistance from the Federal Deposit Insurance Corp. in 2008 and 2009, adding $35 billion of assets and more than 200 offices. The fifth-largest U.S. commercial bank by assets can grow without big deals because it hired employees and upgraded technology during the credit crisis, he said.

Smaller banks that didn't prepare for the recession will fail and will eventually become available in government-backed deals, Davis said. "It will be a buyer's market," he said.

U.S. Bancorp fell 22 cents, or less than 1 percent, to $24.72 as of 4:30 p.m. in New York Stock Exchange composite trading. It has climbed about 10 percent this year.

The bank had $291 billion in assets as of September, and 3,013 branches, primarily in the U.S. Midwest and West, data compiled by Bloomberg show.