Silicon Valley Bank considers Md. branchKenneth P. Wilcox...

BANKING & FINANCE

October 28, 1993|By David Conn | David Conn,Staff Writer

Silicon Valley Bank considers Md. branch

Kenneth P. Wilcox, mixing and schmoozing with the best of them at the Mid-Atlantic Venture Fair earlier this week, could have been mistaken for any of the hundreds of venture capitalists.

But he's no venture capitalist -- he's a banker, one of the few who bothered to come to the fair. That's because Mr. Wilcox's company is the 10-year-old Silicon Valley Bank, based in Santa Clara, Calif. His interest in the Baltimore venture fair, which attracted companies from the Mid-Atlantic region, is an indication that the bank is considering opening a branch in Maryland.

Until recently, Silicon Valley Bank was about the only one in the nation that lended to small technology and venture-backed companies. Mr. Wilcox runs the company's East Coast operations in Wellesley, Mass., one of eight offices, including six in California and one in Beaverton, Ore.

"A number of the venture capitalists that operate in this area have encouraged us to come," he said this week. "We see a market opportunity here, and it appears to be even larger than we thought it would be."

He said Silicon Valley considered a new location here a year ago, but had neither the staff nor the customers to justify it. "But we've increased our head count," he said, and "we're beginning to build a book of business."

The lack of interstate banking reciprocity between Maryland and California is a problem, Mr. Wilcox acknowledged. But the company got around the same obstacle in Massachusetts by setting up what's known as a "non-bank bank" -- it makes loans, but deposits technically are made in the California bank. Speed-of-light electronic banking, however, has alleviated almost all practical problems for the company's 300-plus East Coast customers.

With assets of almost $1 billion, Silicon Valley has both the expertise and willingness to risk lending to start-up companies. Its presence here -- likely within a year, Mr. Wilcox predicts -- would be welcome news to the high-tech companies that can't get in the door of a traditional bank.

MNC shareholders left with cash, not stock

One of the last financial questions about NationsBank Corp.'s acquisition of MNC Financial Inc. was who would get NationsBank stock and who would be stuck with potentially taxable cash. Some stockholders faced a capital gain because they bought MNC's stock below the $15.17 per share merger price.

The answer didn't quite turn out the way MNC had predicted.

NationsBank said it would pay 50.1 percent of the $1.4 billion purchase price with its own stock, and 49.9 percent in cash. As it turned out, 69 percent of MNC shareholders requested stock, and only 27 percent wanted cash (4 percent didn't vote). So, 19 percent of the shareholders -- 3,800 in all, holding 17 million shares -- were paid in cash despite their wishes.

What rankled many was the fact that two MNC shareholders were given a privilege. Then-Chairman Alfred Lerner and Boston-based Fidelity Investments, by virtue of owning more than 5 million shares each, were guaranteed a stock exchange if they wanted it. That would allow them to better plan when and how they might dispose of NationsBank shares, or to hold on and avoid the tax bite altogether.

The tally, completed last week, comes as an added surprise because of what MNC officials had predicted. In June, when MNC shareholders voted to sell the company to NationsBank, Mr. Lerner predicted that the cash-or-stock question would be a non- issue.

The bank said it had commissioned a Morrow & Co. study that showed 44 percent of the shareholders would want stock, and 56 percent would ask for cash (presumably because they faced a capital loss).

Maybe someone misplaced a decimal point.

Provident Bank picks 2 managing directors

Meet some new faces -- and a familiar one -- in financial circles:

vTC * Provident Bank of Maryland has two new managing directors. Richard J. Oppitz has been hired from Bank of Maryland as director of credit administration. Nancy C. Robertson, who worked at Metropolitan Life Insurance Co., and Maryland National Bank before that, joined Provident as director of commercial banking.

* Legg Mason Inc. has fortified its tax-exempt research capability by hiring Kimberly P. Forsyth, formerly of Putnam Investments in Boston, as senior vice president and director of tax-exempt research. Ms. Forsyth, who wrote the book on Maryland county and hospital bonds (two books, actually), will provide research for Legg's Fund Advisor and Capital Management subsidiaries.

* Jeff Salkin, familiar to viewers of WBAL-TV (where he used to be a reporter and weekend anchor) and Maryland Public Television (where he is a reporter and host of "State Circle") has been found lately in the public affairs office of the Washington-based National Association of Securities Dealers.

Last week, Mr. Salkin was named executive producer of MPT's soon-to-be-launched early morning business program, which will be co-produced with Bloomberg Business News. The 15-minute

program for financial professionals airs in January.

* Executive Sounding Board Ltd., a Baltimore mergers and acquisitions consulting firm, an nounced that its president, Paul T. Reamer, has been named chairman of the Institute of Merger & Acquisition Professionals.

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