Silicon Valley Bancshares has hired a senior ranking executive from CIBC Oppenheimer to head its nascent corporate finance unit.
The Santa Clara, Calif., company said late Tuesday that James E. Anderson would succeed James F. Forrester, who resigned after 13 years with the high technology-oriented bank to pursue employment outside of commercial banking.
Mr. Anderson, who is slated to begin his duties Monday, is the managing director for technology investment banking at CIBC Oppenheimer's Menlo Park, Calif., office.
He was also named to Silicon Valley's five-person executive committee. Financial terms of his contract were not disclosed.
Mr. Anderson, who has more than 15 years of commercial and investment banking experience, said he sees his new position as a "significant opportunity to expand the breadth of corporate services to Silicon Valley Bank's clients."
"I've known this bank since it was founded (in 1983). I like the culture and the company," he said.
Silicon Valley, which targets early-stage and middle-market companies in the high-tech sector, formed its corporate finance unit in July as a pilot. The division acts as a financial adviser to emerging companies and helps them raise equity and debt through private sources. Silicon Valley will also begin investing its own capital in these companies, Mr. Anderson said.
Analysts said it is too early to predict if the move will pay off for Silicon Valley, which has lost some of its luster in recent months. The $3.1 billion-asset bank recently reported that its fourth-quarter earnings could be as much as 50% below analysts' estimates. The bank said it plans to charge off $7 million in loans and take a loan-loss provision of $16 million to $20 million because of problems in its bridge loan product and unsecured investments in companies at early stages of product development.
Joseph K. Morford 3d, a bank analyst at San Francisco-based Van Kasper & Co., said that it seems logical to hire an investment banker to head the division.
"Jim Forrester was instrumental in developing this niche for the bank, but it makes sense at this point to turn it over to someone with direct investment banking experience," Mr. Morford said.
Unlike start-up financing, private debt deals are less risky and are typically considered an intermediary form of financing before a company goes public.
Under the initiative, the company issues debt up to $10 million. Silicon Valley hopes the program breaks even this year and turns a profit in 2000, analysts said.