Declaring a need for a community bank in Northern California's East Bay area, San Jose's Heritage Bank of Commerce is adding a second branch in Fremont.

The $255 million-asset bank, founded in 1994, hopes to raise $5 million to $6 million through a stock sale to fund the new Fremont office. The goal is to attract the growing number of small-business customers moving to the East Bay, said Heritage president and chief executive officer John E. Rossell. He also wants to fill the void left when California Bancshares was sold to Oregon-based U.S. Bancorp in 1996.

U.S. Bancorp has since been sold to First Bank System, Minneapolis.

"We think a vacuum's been created by the departure of California Bancshares," Mr. Rossell said.

Heritage plans to form a one-bank holding company to operate the two Fremont branches. It is planning the stock sale for the first half of 1998.

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