SAN FRANCISCO - Rumblings in the technology-laden Nasdaq market notwithstanding, the race to plumb the new wealth segment of Silicon Valley has several of the country's largest private bankers pumping up their operations in Northern California.
The planned initiatives include advertising campaigns by Northern Trust Corp. of Chicago and Bank of America Corp. of Charlotte, N.C., each aimed specifically at affluent California residents.
Meanwhile, U.S. Trust Co. of New York will launch its own ads in the market to highlight new capabilities made possible by its acquisition by the San Francisco electronic brokerage Charles Schwab Corp.
Bank of America, which already runs an office in Palo Alto and has substantial roots in the market because it used to be based in San Francisco, said it will open two private banking offices in Silicon Valley on August 15, even as it plans to scale back substantially in other areas. First Republic Bank of San Francisco plans to open a new regional banking center in Palo Alto, Calif. - the heart of Silicon Valley - within a year.
These companies follow a host of others that have been expanding in the region, including J.P. Morgan & Co. and Chase Manhattan Corp.
Private bankers say they still rely on well-placed contacts with other service providers to the wealthy, like accountants, lawyers, and real estate agents, for most referrals, but are increasingly ensuring their physical appearance catches the attention of the right audience.
For its new Menlo Park location on Sand Hill Road, the nucleus of tech-oriented venture capital activities, Bank of America will offer special features like modem lines, real-time ticker quotes and Bloomberg terminals for its waiting customers - for a look that is a first for its private banking offices. "When you come through the door, it feels very techy," said Kathy Gallagher, a senior vice president at the bank.
Bank of America also is expanding a small San Jose office and converting it for private banking. It plans to hire 10 more private bankers to staff the offices.
First Republic, a longtime specialist in private banking, does 85% of its business in California and has offices in three Silicon Valley cities - Menlo Park, San Mateo and Burlingame. Its decision to open a fourth regional banking center, along the lines of its New York or San Francisco centers, will make room for a bigger presence in the area, said Katherine August-deWilde, the bank's chief operating officer and executive vice president.
Over time the new office will have "three or four times" the number of bankers currently staffing its Menlo Park office, now at about 10, she said.
Private banking executives said the moves are partly defensive. Gregory F. Sanford, president and chief executive officer of U.S. Trust N.A, the California affiliate of the New York company that just opened its own office in Silicon Valley, said "The list of financial services firms that are in this area grows every year and will continue to grow."
But advertising, even in the typically hush-hush world of private banking, still has its place in distinguishing one institution's services from the next.
Northern Trust is taking its "Trust Northern" campaign to California. The bank has used a similar campaign, featuring local business, sport and arts celebrities, for Chicago and other markets.
A Bank of America campaign titled "Invest in the West," will include private banking ads, similar to those already appearing in national print publications, which will appear in local California publications this month and in fall.
U.S. Trust, which thus far has kept its name and marketing completely independent from its new parent Schwab, is planning new ad campaigns "that are broader than what U.S. Trust has done in the past," said Mr. Sanford, without being more specific.