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2 Minnesota banks to share Visa windfall
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Accountants sometimes giveth. Other times, they taketh away.
Two big banks in Minnesota are about to discover the joy of receiving after suffering the pain of giving.
Welcome news in tough financial times: Wells Fargo & Co. and U.S. Bancorp soon will be showered with cash to compensate for a couple of fourth-quarter charges.
Both banks own a slice of Visa International, the credit card company.
In the fourth quarter, that was bad news. To pay the costs of an industrywide settlement in a lawsuit against Visa, Wells Fargo made a $203 million write-off and U.S. Bancorp took a $215 million hit. Wells recorded a $95 million operating loss tied to the Visa litigation in 2006.
This week, owning a piece of Visa was more pleasant.
In a wildly successful initial public offering, Visa raised $18 billion. Wells' take from the offering amounts to $295 million, while $298 million will go to U.S. Bancorp, according to the prospectus filed with the SEC.
No word yet on how bank executives plan to use the windfall. Paying down Visa balances, perhaps?
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