Silicon Valley Bank to establish an Irish presence – US$100m of new lending

19 Jun 2012

A major Silicon Valley Bank is to establish a presence in Ireland with US$100m of new lending facilities for innovative companies. A partnership has been forged with the National Pensions Reserve Fund.

Silicon Valley Bank, which last week opened a branch in London, will complete two independent transactions as part of its partnership with the National Pensions Reserve Fund.

In the first transaction, Silicon Valley Bank expects to deploy US$100m of new lending commitments to fast-growing Irish technology, life sciences, clean-tech, private equity and venture capital businesses over five years, subject to its usual lending criteria.

The bank will, either directly or through one of its group affiliates, also add a local representative to work with these businesses in Ireland as they grow. The NPRF will help Silicon Valley Bank identify potential clients in these niche sectors.

In a separate transaction, the NPRF has made a commitment to invest in technology-focused funds managed by SVB Capital.

“Building on the momentum we’ve seen in the UK with our recently opened UK branch and our aspirations to support our innovative clients around the world, we are really looking forward to bringing our knowledge and global network to entrepreneurs in Ireland,” Greg Becker, president and CEO of Silicon Valley Bank, said.

“We’d like to thank the Irish Government and particularly the NPRF for their proactive approach and support of our efforts to enter the market.”

Innovative companies need banks that understand them

The move is particularly important for the innovative companies in Ireland who are key to the nation’s financial recovery.

The latest ISME Quarterly Bank Watch Survey, issued Monday, shows that while demand for bank credit is steady at 37pc, the refusal rate has risen again to 54pc, after slight improvements in the previous two quarters.

In effect, bailed-out banks in Ireland aren’t lending as they should – this means that innovative companies with world-beating ideas are highly unlikely to be understood on a local level.

Paul Carty, chairman of the National Pensions Reserve Fund Commission, said: “Bringing Silicon Valley Bank’s expertise and understanding of emerging and high-growth companies to Ireland will have a significant and positive impact on the ability of our vibrant innovation sector to reach its long-term growth potential.”

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years