US Bancorp to Accept California IOUs
MINNEAPOLIS (
) --
US Bancorp
(USB) - Get Report
said Friday it will accept IOUs from California, following the lead of bigger competitors earlier in the week.
The Minneapolis-based bank will accept the registered warrants starting on Tuesday, through Oct. 9.
"U.S. Bank is pleased that a budget resolution has been passed so that we can all focus on helping the state and our national economy get back on its feet and poised for growth in the months ahead," Joseph Otting, a US Bancorp vice chairman of commercial banking who is based in Los Angeles, said in a statement.
California had said in July that it would be unable to pay interest on municipal bonds until a budget crisis was resolved. Banks had refused to accept the IOUs until earlier this week, after the state indicated that those interest payments would resume earlier than expected.
Bank of America
(BAC) - Get Report
and
Wells Fargo
(WFC) - Get Report
said earlier in the week that they, too, would start accepting the warrants despite earlier resistance. Other banks like
JPMorgan Chase
(JPM) - Get Report
and
Citigroup
(C) - Get Report
also have exposure to the debt. Ironically, JPMorgan is issuing California a loan that will help the state in part to make more timely interest payments.
-- Written by Lauren Tara LaCapra in New York
.
