What is the primary purpose of this 8-K filing?

This 8-K filing primarily announces the closing of U.S. Bancorp's public offering of $500 million in Trust Preferred Securities and details the structure of the transaction, including the guarantee and the underlying debentures.

What is the risk associated with these Trust Preferred Securities for investors?

The key risk for investors is that the U.S. Bancorp guarantee is subordinated. This means that in the event of a bankruptcy or liquidation, holders of the Trust Preferred Securities would be paid only after senior creditors of U.S. Bancorp have been satisfied.

How does this offering affect U.S. Bancorp's capital structure?

This offering represents a method for U.S. Bancorp to raise long-term capital. By issuing junior subordinated debentures to a trust which then issues preferred securities, the company effectively enhances its capital base, likely for regulatory or operational purposes, while incurring a fixed interest expense.

What is the maturity date of the investment for the purchasers of these securities?

The Trust Preferred Securities themselves represent preferred interests in the trust. The underlying investment is in 6.625% junior subordinated debentures due 2039. Therefore, the economic maturity for the capital invested is effectively tied to the 2039 maturity of the debentures.

US BANCORP \DE\ 8-K SEC Disclosure

Summary

U.S. Bancorp (USB) announced on December 10, 2009, the successful closing of a public offering of $500 million in aggregate principal amount of 6.625% Trust Preferred Securities. These securities, issued by a statutory trust (USB Capital XIII), represent preferred beneficial interests in the trust and are fully and unconditionally guaranteed on a subordinated basis by U.S. Bancorp. The proceeds from this offering, along with the sale of the trust's common securities, were used by the trust to purchase 6.625% junior subordinated debentures due 2039 issued by U.S. Bancorp. This transaction represents a form of capital raising for the company, utilizing a trust preferred securities structure. Investors should note the subordinated nature of the guarantee and the long-term maturity of the underlying debentures.

Key Highlights

1U.S. Bancorp closed a $500 million public offering of Trust Preferred Securities.
2The Trust Preferred Securities carry a coupon of 6.625% and mature in 2039 (via underlying debentures).
3The securities were issued by USB Capital XIII, a statutory trust.
4U.S. Bancorp provided a full, irrevocable, and unconditional subordinated guarantee for the securities.
5Proceeds were used by the trust to purchase 6.625% junior subordinated debentures issued by U.S. Bancorp.
6The transaction was underwritten by Morgan Stanley & Co. Incorporated, Credit Suisse Securities (USA) LLC, and U.S. Bancorp Investments, Inc.
7The securities and guarantee are registered under the Securities Act of 1933.

US BANCORP \DE\ 8-K Report, Corporate Update (Dec 10, 2009)

Summary

Key Highlights

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