Silicon Valley Bank, a lender to high-tech companies, is referring clients to two other companies for trust and investment services.
The $2.1 billion-asset bank, which has seven offices in California and Massachusetts for private clients, says it has no desire to become a money manager or trustee.
"We've chosen not to do that," said senior vice president Jean Whitney Blomberg. Instead, Silicon Valley prefers to send clients to "specialists," she said.
East Coast clients are being referred to State Street Corp., Boston, and West Coast clients to Van Kasper Advisers, San Francisco, for their trust needs.
Santa Clara, Calif.-based Silicon Valley boasts an executive banking division with 500 clients who are coming out of debt. Ms. Blomberg's group interviewed over 100 investment advisers, looking for those best suited to serving such customers.
The bank considered whether a firm would compete for their personal or business loans, looked at investment managers' track records, and checked if the advisers had experience managing investments for clients who are asset-rich but cash-poor.
"These two firms matched up with those criteria really well," Ms. Blomberg said. "We feel they're the best."
Silicon Valley's private client division hopes to continue a strategy of piggybacking on the success of the bank's core commercial banking business. In the past few years the bank has expanded to Atlanta; Austin, Tex.; Beaverton, Ore.; Bellevue, Wash.; Boulder, Colo.; Phoenix; and Rockville, Md.
As it develops more private clients in those locales, Silicon Valley plans to refer them to State Street and Van Kasper for asset management. Both companies draw investors from the technology sector.
Van Kasper Advisers, the investment management arm of Van Kasper & Co., an investment banking and brokerage firm, manages more than $350 million for people and institutions. It is based in San Francisco and has seven other offices in the state.
With its focus on emerging growth companies, Van Kasper already had informal ties with the bank.
"Our target client is similar," said Leon A. Wiatrak, director of Van Kasper Advisers. "We're not in a competitive position with the bank or vice versa."
State Street, a global custodian and institutional money manager, has a private client group in New England that manages over $8 billion of assets. Its trust and investments division opened a San Francisco office this month and plans to set up shop in Naples, Fla., later this fall.
State Street's special investors group uses quantitative analysis to diversify clients' assets that are often tied up in one security.
"Certainly the folks building wealth through technology understand the value technology can bring," said Roberta G. Sydney, a vice president with State Street.
