State Farm is exiting the banking business and will enter a strategic alliance with  U.S. Bank, which will take over the insurance company’s existing deposit accounts and credit cards and offer its own deposit accounts and co-branded credit cards to customers through State Farm agents.

The companies are also exploring plans to offer vehicle loans and business banking to State Farm customers. 

"State Farm has been committed to helping people for nearly 98 years," Michael Tipsord, president and CEO of State Farm, said in a company release. "When we combine State Farm’s deep customer relationships with the scale and capabilities of companies like U.S. Bank, we can help significantly more people."

The transition of accounts is scheduled to begin after the deal closes later in 2020 and into 2021 and is subject to regulatory approval.

"We are excited about this new alliance with State Farm because it will help us reach more customers in the moments that matter most," Andy Cecere, chairman, president and CEO of U.S. Bank, said in the release. "It is a terrific opportunity to combine U.S. Bank products, services and digital capabilities with State Farm’s coast to coast network of agents." 

State Farm has 19,000 agents with more than 81 million insurance accounts and 2 million bank and investment planning accounts. U.S. Bank is the fifth-largest commercial bank in the U.S.