(By Balaseshan) U.S. Bancorp (NYSE: USB) said lead bank U.S. Bank is strengthening its position in the pre-paid market by acquiring Florida-based prepaid card processing company FSV Payment Systems for an undisclosed sum.
FSV, founded in 1999, is known for its expertise managing a broad range of prepaid programs for companies, governments and other financial institutions. Upon completion of the acquisition, FSV will operate under U.S. Bank's Elan Financial Services brand.
U.S. Bank continues to grow its business across multiple pre-paid market segments, including corporate, consumer, government and campus. Some of the pre-paid products that U.S. Bank offers include payroll, general purpose reloadable (GPR), government disbursements, gift, incentives, reward, and campus cards.
The acquisition combines U.S. Bank's payments strength and prepaid expertise with FSV's platform which will position the combined entity as one of the few financial institutions in the industry capable of providing efficient end-to-end pre-paid programs and services for its clients.
The programs and services that FSV clients currently use will continue uninterrupted through the transition, and in the future they will benefit from new developments and innovations that the combined business will provide.
"We believe FSV's strong leadership team, experienced staff, and integrated platform will complement our existing payments services. Combining U.S. Bank's strength in payments with FSV's scalable platform will accommodate our current volume as well as our future growth in the prepaid arena," said Kevin Morrison, senior vice president of U.S. Bank Retail Payment Solutions.
The acquisition is expected to close in December, pending regulatory approval.
The company operates 3,086 banking offices in 25 states and 5,080 ATMs and provides a comprehensive line of banking, brokerage, insurance, investment, mortgage, trust and payment services products to consumers, businesses and institutions.
USB is trading down 0.66 percent at $32.17 on Tuesday. The stock has been trading between $24.45 and $35.46 for the past 52 weeks.