SVB Financial Group Announces Selected Unaudited Preliminary Financial Results Expected...

SVB Financial Group Announces Selected Unaudited Preliminary Financial Results
Expected for First Quarter 2009; Company to Host Conference Call to Discuss
Preliminary Results

SANTA CLARA, Calif., April 7 /PRNewswire-FirstCall/ -- SVB Financial Group
(Nasdaq: SIVB), parent company of Silicon Valley Bank, announced selected
unaudited preliminary financial results expected for the first quarter of 2009
and an update to the company's outlook on credit quality for 2009.

Based on preliminary first quarter financial information, the company is
expecting to report a consolidated net loss applicable to common stockholders
for the first quarter of 2009 in the range of approximately $9.0 million to
$12.0 million and a diluted loss per common share in the range of $0.28 to
$0.36. As discussed below, the expected loss is generally attributable to the
impact of: (i) credit quality of certain specific loans, (ii) valuation
declines of venture capital/private equity investments, (iii) a lower than
expected net interest margin primarily due to deposit growth and low returns
on excess cash levels, and (iv) other items as discussed below.

"While the challenges of the current economy have affected us, resulting in a
loss for the consolidated company in the first quarter, our core business
continues to perform," said Ken Wilcox, president and CEO of SVB Financial
Group. "We expect to report a profitable first quarter for our primary
banking subsidiary, Silicon Valley Bank. Moreover, the holding company and
the bank continue to be well-capitalized. We have been proactively
strengthening our capital and liquidity position to help ensure we are there
to support our clients throughout this economic cycle."

Selected highlights of the company's unaudited preliminary financial results
expected for the first quarter of 2009 are as follows:

-- Provision for loan losses of approximately $40.0 million to $45.0
million. Factors that caused the provision to increase for the quarter
were primarily the following:

- Approximately $31.0 million of the provision was attributable to two
"Shared National Credit" ("SNC") loans in which the company
participated; and

- Consistent with management expectations, the remainder of the
provision was primarily attributable to certain loans to early stage
companies.

As of March 31, 2009, the company's portfolios for (i) SNC loans in
which the company participated totaled approximately $236.0 million;
(ii) SNC loans originated by the company totaled approximately $27.0
million; and (iii) early-stage loans totaled approximately $636.0
million. Additionally, as of March 31, 2009, the company's allowance
for loan losses is expected to be approximately 2.20% of total gross
loans, and 1.40% of total gross loans, exclusive of existing specific
reserves for impaired loans.

The provision was also impacted by other favorable factors, primarily
including:

- The reduction of general reserves by approximately $7.0 million due
to the decline in period-end loan balances from the fourth quarter
of 2008 to the first quarter of 2009; and

- The reversal of specific reserves by approximately $4.8 million due
to the repayment by affiliates of HRJ Capital, LLC ("HRJ") of
certain outstanding balances on capital call lines of credit during
the first quarter of 2009.

An independent asset management firm recently announced that it had
entered into a term sheet with HRJ to assume the management of HRJ's
funds of funds. The final transaction is subject to the execution
of definitive agreements between the parties and other closing
conditions. If the transaction closes based on the proposed terms,
the company does not expect that the transaction will have a
material impact on its net income and provision for loan losses.

-- Net losses on investment securities relating to the company's
consolidated investment funds and other venture capital/private equity
investments of approximately $36.0 million. Net of noncontrolling
interests (formerly referred to as minority interests), such net losses
are expected to be approximately $5.0 million. This expected net loss
is primarily attributable to the continuing effects of the downturn in
the overall economy, causing pressures on valuations of venture
capital/private equity investments.

A reconciliation of the company's net losses on investment securities,
net of noncontrolling interest, is provided under the section "Non-GAAP
Financial Measures" below.

-- Lower than expected net interest margin, on a fully taxable equivalent
basis, of approximately 3.95% to 4.00%, largely due to higher than
expected levels of interest-bearing deposits, which were primarily
invested in overnight funds with the Federal Reserve. As part of its
efforts to continue to strengthen its capital and liquidity, during the
fourth quarter of 2008, the company increased its client deposit
balances through the offering of its own on-balance sheet sweep
product. Upon completion of the company's analysis of its current
client loan and deposit activities and behaviors, the company expects
to invest a more significant portion of the excess cash in higher
yielding assets during the second quarter of 2009.

-- Loan to deposit ratio and loan and deposit balances are as follows:

- As of March 31, 2009: (i) a ratio of period-end loans (net of
unearned income) to deposits of approximately 59.0%, (ii) period-end
loans (net of unearned income) of approximately $5.0 billion, and
(iii) period-end deposits of approximately $8.5 billion.

- For the first quarter of 2009: (i) a ratio of average loans (net of
unearned income) to deposits of approximately 64.5%, (ii) average
loans (net of unearned income) of approximately $5.1 billion, and
(iii) average deposits of approximately $7.9 billion.

-- Included in the net loss applicable to common stockholders is
approximately $3.5 million related to dividends, and discount
amortization, in connection with the company's preferred stock issued
under the Capital Purchase Program.

-- Non-tax deductible charge of approximately $2.0 million to $3.0 million
relating to the impairment of goodwill associated with eProsper,
primarily due to the change in revenue outlook for that business.

-- Expected capital ratios for the company and Silicon Valley Bank as of
March 31, 2009 are:

SVB Financial Silicon Valley
Group Bank
Total risk-based capital
ratio 18.74% 16.25%
Tier 1 risk-based capital
ratio 13.65% 11.08%
Tier 1 leverage ratio 10.10% 8.28%
Tangible common equity to
tangible assets ratio (1)(2) 6.87% 7.94%
Tangible common equity to
risk-weighted assets ratio (1) 9.98% 11.08%

(1) Tangible common equity consists of total stockholders' equity
(excluding preferred equity, and unrealized gains and losses from the
company's fixed income investments) less acquired intangibles and
goodwill.
(2) Tangible assets represent total assets (excluding unrealized gains and
losses from the company's fixed income investments) less acquired
intangibles and goodwill.

Updated Outlook for the Year Ending December 31, 2009

The Company has updated its outlook on credit quality for the full year ending
December 31, 2009 and expects its full year 2009 net loan charge offs to be in
the range of 1.75% to 1.80% of total gross loans, which is (i) inclusive of
approximately $40.0 million in net charge offs expected in the first quarter
of 2009, but (ii) exclusive of any potential net charge offs related to loans
impaired as of March 31, 2009. For the second through fourth quarters of
2009, we expect quarterly net charge offs (annualized) of approximately 1.40%
of total gross loans, excluding any potential net charge offs related to loans
impaired as of March 31, 2009. This compares to the outlook provided on
January 22, 2009 related to net charge offs to total gross loans of 1.30%
(excluding any potential charge offs related to impaired loans as of December
31, 2008) for the full year 2009. All other updates to the company's outlook
for 2009 are expected to be updated by the company on April 23, 2009, to the
extent necessary.

The outlook statements above are, by their nature, forward-looking statements
and are subject to substantial risks and uncertainties which are discussed
below under the section "Forward-Looking Statements."

Conference Call Regarding Preliminary Results

On April 8, 2009, the company will host a conference call at 8:00 a.m.
(Pacific Time) to discuss its preliminary financial results expected for the
first quarter ended March 31, 2009. The conference call can be accessed by
dialing (877) 663-9523 or (404) 665-9482, and referencing the conference ID
"94107192". A live webcast of the audio portion of the call can be accessed on
the Investor Relations section of the company's website at www.svb.com. A
replay of the conference call will be available beginning at approximately
10:00 a.m. (Pacific Time) on Wednesday, April 8, 2009, through midnight on
Wednesday, April 22, 2009, by dialing (800) 642-1687 or (706) 645-9291 and
referencing conference ID number "94107192." A replay of the audio webcast
will also be available on www.svb.com for 12 months beginning Wednesday, April
8, 2009.

The company expects to host its regular quarterly earnings conference call on
April 23, 2009 to discuss the financial results for the first quarter ended
March 31, 2009. Details of the call will be announced at a later date.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. Forward-looking
statements are statements that are not historical facts, and can be identified
by the use of words such as "becoming," "may," "will, " "should," "predicts,"
"potential," "continue," "anticipates," "believes," "seeks," "expects,"
"plans," "intends," the negative of such words, or comparable terminology.
Throughout this release, management makes forward-looking statements about
expected financial results for the first quarter of 2009, as well as for the
year ending December 31, 2009 under the section "Updated Outlook for the Year
Ending December 31, 2009." Although management believes that the expectations
reflected in its forward-looking statements are reasonable and has based these
expectations on its beliefs and assumptions, such expectations may prove to be
incorrect. Actual results may differ. Factors that could cause actual results
to differ include, among others: (i) continued deterioration or other changes
in the state of the economy or the markets in which the company conducts
business or are served by the company, (ii) additional adjustments in the
company's calculation of financial results or the application of accounting
principles, including as a result of review of these preliminary estimates by
the company's independent auditors, (iii) discovery of new information by the
company which alters its expectations about its first quarter results or
impacts valuation methodologies underlying such results; (iv) errors in the
company's assessment of the creditworthiness or liquidity of its clients or
unanticipated effects of credit concentration risks which create or exacerbate
deterioration of such creditworthiness or liquidity; (v) other changes in
credit quality of the company's loan portfolio; (vi) changes in interest rates
or market levels or factors affecting them; (vii) changes in the performance
or equity valuations of companies in which the company has invested or hold
derivative instruments or equity warrant assets; (viii) variations from
management's expectations as to factors impacting the company's cost
structure; and (ix) accounting changes, as required by U.S. generally accepted
accounting principles. For additional information about factors that could
cause actual results to differ from the expectations stated in forward-looking
statements, please refer to the company's most recently-filed Annual Report on
Form 10-K for the year ended December 31, 2008. All subsequent written or oral
forward-looking statements attributable to the company or persons acting on
the company's behalf are expressly qualified in their entirety by these
cautionary statements. The forward-looking statements included in this report
are made only as of the date of this report. The company does not undertake
any obligation to update forward-looking statements.

The preliminary expected results for the first quarter discussed in this
release are based on information available at this time and are subject to
change due to a variety of factors, including among others: (i) management's
finalization of its quarterly closing of its financial reporting processes,
and (ii) as a result of review by the company's independent auditors. These
results could differ from the company's actual reported quarterly results
expected to be announced on April 23, 2009 and in its Quarterly Report on Form
10-Q for the first quarter ended March 31, 2009, which the company expects to
file in May 2009.

About SVB Financial Group

For over 25 years, SVB Financial Group and its subsidiaries, including Silicon
Valley Bank, have been dedicated to helping entrepreneurs succeed. SVB
Financial Group is a financial holding company that serves companies in the
technology, life science, venture capital/private equity and premium wine
industries. Offering diversified financial services through Silicon Valley
Bank, SVB Analytics, SVB Capital, SVB Global and SVB Private Client Services,
SVB Financial Group provides clients with commercial, investment,
international and private banking services. The Company also offers funds
management, broker-dealer services and asset management, as well as the added
value of its knowledge and networks worldwide. Headquartered in Santa Clara,
California, SVB Financial Group operates through 27 offices in the U.S. and
international operations in China, India, Israel and the United Kingdom. More
information on the Company can be found at www.svb.com. (SIVB-F)

Banking services are provided by Silicon Valley Bank, the California bank
subsidiary and commercial banking operation of SVB Financial Group, and a
member of the FDIC and the Federal Reserve. SVB Private Client Services is a
division of Silicon Valley Bank. SVB Financial Group is also a member of the
Federal Reserve.

Non-GAAP Financial Measures

To supplement the company's selected unaudited preliminary financial results
for the first quarter of 2009 presented in accordance with generally accepted
accounting principles in the United States ("GAAP") in this press release, the
company uses a certain non-GAAP measure of financial performance which
excludes from its expected GAAP net loss for the first quarter of 2009:

-- Income and expense that are attributable to noncontrolling interests -
As part of its funds management business, the company recognizes the
entire income or loss from funds where it owns significantly less than
100%. The company is required under GAAP to consolidate 100% of the
results of the funds that it is deemed to control or have a majority
ownership. The relevant amounts attributable to investors other than
the
company are reflected under "Net Losses Attributable to
Noncontrolling Interest" below. The company's net loss as
reported in that section includes only the portion of income or loss
that is attributable to its ownership interest.

Non-GAAP financial measures are not in accordance with, or an alternative for,
GAAP. Generally, a non-GAAP financial measure is a numerical measure of a
company's performance that either excludes or includes amounts that are not
normally excluded or included in the most directly comparable measure
calculated and presented in accordance with GAAP. The company believes that
this non-GAAP financial measure, when taken together with the corresponding
GAAP financial measures, provide meaningful supplemental information regarding
its performance by excluding amounts attributable to noncontrolling interests,
where indicated, or certain items that do not occur in every reporting period
of its core business, operating results or future outlook. Management uses,
and believes that investors benefit from referring to, this non-GAAP financial
measure in assessing its operating results and when planning, forecasting and
analyzing future periods. This non-GAAP financial measure should be considered
in addition to, not as a substitute for or superior to, net loss, or other
financial measures prepared in accordance with GAAP. In the financial table
below, the company has provided a reconciliation of the most comparable GAAP
financial measure to the non-GAAP financial measure used in this press
release.

Net Losses Attributable to Noncontrolling Interest

Non-GAAP net losses on investment securities, Three Months
net of noncontrolling interest Ended
(Dollars in millions) March 31, 2009

GAAP net losses on investment securities $36.0
Less: losses attributable to noncontrolling interests,
including carried interest $31.0
Non-GAAP net losses on investment securities, net of
noncontrolling interest $5.0

SOURCE SVB Financial Group

Meghan O'Leary, Investor Relations of SVB Financial Group, +1-408-654-6364