Citizens Bank has set its sights on Silicon Valley – and beyond.
RBS Citizens, the commercial banking division of Citizens Financial Group, today announced that it would roll out its Technology and Services banking group nationally to complement the national expansion of its mid-corporate business.
The Technology and Services group, which is headed up by Managing Director William Egge, was established about five years ago and initially focused on the Greater Boston area, Egge told Banker & Tradesman. Until today, that specialty banking group had worked within Citizens’ current footprint.
Now, the bank hopes to cement more relationships with technology and services businesses in areas like Denver, Atlanta, Dallas, Austin and, of course, the West Coast.
"We’ve got a little bit of a head start on this announcement," Egge said, by way of explaining that Citizens already had a few relationships outside of its current footprint.
The Technology and Services banking group focuses primarily on four sectors: software and systems, business services, hardware and equipment, and media and communications.
Egge has more than 17 years of experience in the industry, as a banker specializing in technology and service businesses at Wachovia Securities and as an M&A and corporate finance professional for two private equity-backed technology companies.
"There are trends in the business that are unique to technology. It’s very much based on IT spending within corporate America," he said. "From a risk perspective within a bank, it’s wise to have the focus on that. These businesses are very attractive from a cash flow perspective, but they oftentimes do not have a lot of assets … You’re really focusing on the cash flow and the enterprise value of the business."
Software as a service, he said, is one area within the tech sector that has a lot of potential as an attractive cash generation business model. For as fast as technology moves today, it’s valuable to have specific industry expertise to lend in this space, he said.
"It’s really an evolving space. You do have to stay ahead of trends and have an understanding of the business models that are popping up."
