U.S. Bank Institutional Trust & Custody has entered into a definitive agreement to sell its 401(k) business to Great-West Life & Annuity. The unit has only 195,000 participants, and to be profitable, a defined contribution business needs at least two million participants, the bank said.
“U.S. Bank remains firmly committed to the institutional trust, custody and health savings account businesses,” said Diane Thormodsgard, president of the bank. “The acquisition of the Wachovia institutional custody business demonstrates our commitment and willingness to invest in this business. The sale of the 401(k) business allows us to concentrate our focus and resources on businesses where we have significant scale and/or opportunity for growth.”
The transaction is expected to close by the end of the month.