U.S. Bancorp is joining the banking industry’s consolidation rush with a nearly $8 billion deal to purchase MUFG Union Bank, which chiefly operates in West Coast states.

With the purchase, U.S. Bank, which has 148 offices in Washington, including 68 in King, Pierce and Snohomish counties, will increase its retail market share in the state to about 11%, just behind Wells Fargo.

Union Bank has 14 offices in King, Pierce and Snohomish, according to Federal Deposit Insurance Corp. data.

Overall, the purchase will increase the size of U.S. Bank’s loans and deposits by about 20% and sharply increase its market presence in California, where it will rise to fifth place from tenth in retail banking market share.

“The acquisition of Union Bank meaningfully increases our scale at a time when scale is as important as it’s ever been for the industry, and it adds market share in the demographically attractive California and other West Coast markets,” Andy Cecere, U.S. Bancorp’s chief executive, told investors and analysts this morning.

It’s the largest deal by the Minneapolis-based banking company since its $21 billion merger with Firstar Corp. in 2001 made it one of the nation’s ten largest banks. It’s also the first purchase of another banking operation by U.S. Bank since 2014.

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The deal comes as merger activity re-accelerates in the banking industry, driven in part by rising technology costs and the efficiency of serving more customers. The pandemic and recession last year dropped the number of deals by more than half in both volume and value.

But last year’s deals included one of Minnesota’s largest and best-known banking brands, TCF, which was acquired by Ohio’s Huntington Bancshares Inc. And 2020’s largest deal in banking was an $11.6 billion purchase by PNC Financial Services Group, the Pittsburgh banking firm that is close to U.S. Bancorp in size, of BBVA USA Bancshares.

With the MUFG Union Bank deal, U.S. Bank will pick up about 1 million consumer customers and 190,000 small business customers, chiefly in California, Oregon and Washington. It will add $58 billion in loans to a base of $294 billion. It also gets $90 billion in deposits, lifting its base of $429 billion.

Mitsubishi UFG Financial Group, the Tokyo-based parent of MUFG Union, will retain its global corporate and investment bank.

In a statement, Kevin Cronin, chief executive of MUFG’s U.S. operation, said the company was “very pleased” to reach a deal with U.S. Bank. MUFG will add people and resources to its wholesale bank business in North America, focusing chiefly on corporate bank services.

U.S. Bank will pay MUFG $5.5 billion in cash and 44 million of its shares, which had a value of $2.45 billion at Monday’s closing price of $55.68. When the deal is done, MUFG will hold a nearly 3% stake in U.S. Bancorp.

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U.S. Bank executives said they’ve identified about $900 million in cost savings that can be had after the merger. They said they are committed to retaining all of MUFG Union Bank’s front-line branch employees.

“We will not be exiting any markets or reducing availability to branches or banking services in any low and moderate income neighborhoods,” Terry Dolan, U.S. Bank’s chief financial officer, said.

Cecere called U.S. Bank’s approach to acquisitions “disciplined.”

“Union Bank is the right deal at the right time for the right price,” he said. “It adds scale, provides significant opportunity to optimize the combined distribution network, and it meaningfully increases our market share and demographically attractive markets.”

The deal has been approved by the boards of both companies and executives aim to complete it in the first half of next year.

Seattle Times staff contributed to this report.