Document





UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


Date of Report (Date of earliest event reported): February 1, 2019


SVB Financial Group
(Exact name of registrant as specified in its charter)
Delaware
 
000-15637
 
91-1962278
(State or other jurisdiction
of incorporation)
 
(Commission File Number)
 
(I.R.S. Employer Identification No.)


3003 Tasman Drive, Santa Clara, CA 95054-1191
(Address of principal executive offices) (Zip Code)
 
Registrant’s telephone number, including area code: (408) 654-7400
 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.142-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o






Item 7.01    Regulation FD Disclosure.
Over the upcoming weeks, members of management will be presenting to or conducting one-on-one meetings with investors, analysts or other third parties about SVB Financial Group (the “Company”) and its latest financial results. A copy of the presentation slides, updated with the Company’s financial results for the 2018 fourth quarter and full-year, substantially in the form expected to be used in such presentations and meetings, is attached hereto as Exhibit 99.1 and is incorporated herein by reference. The information contained in this report and in the exhibit hereto is intended to be “furnished” and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section.

Item 9.01    Financial Statements and Exhibits.

(d)
Exhibits.

Exhibit No.
Description

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
Date: February 1, 2019
 
 
 
SVB FINANCIAL GROUP
 
 
 
 
 
 
 
 
By:
 
/s/ KAMRAN HUSAIN
 
 
 
 
Name:
 
Kamran Husain
 
 
 
 
Title:
 
Chief Accounting Officer and Principal Accounting Officer






q418irpresentation
Q4 and FY 2018 Corporate Overview and Financial Results February 1, 2019


 
Contents 3 Important information regarding forward-looking statements and use of non-GAAP financial measures 4 Glossary 5 About SVB 10 Overview of Results 17 2019 Outlook and Long-Term Financial Objectives 26 Financial Performance: Balance Sheet 40 Financial Performance: Income Statement 52 Capital 55 Regulatory 57 Non-GAAP Reconciliations Q4 and FY 2018 Corporate Overview and Financial Results February 1, 2019 2


 
Glossary Acronyms Other Measures Measures Non-GAAP The following termsareusedthroughoutthispresentationtoreferSVB-specific tocertain metrics: Q4 and FY 2018 Q4 andFY • • • • • • • • • • • • VC/PE – NCO – NCI – LIHTC – CRM – CCAR – Fixed Income Securities Total Client Funds– effectively donotreceive theeconomic benefitorcost. Thismeasureexcludestononcontrolling interest. interestsforapplicable, amountsattributable whichwe andcarried result ofexercised portfolio, when equitywarrantassets,gainsandlossesfromsalesofour AFS debtsecurities heldasa whichincludepublicequitysecurities gains andlossesfromournon-marketable andotherequitysecurities, NetofNon-ControllingGains (losses)onInvestment Securities, Interests typically subjecttomarket orotherconditions beyondourcontrol. andequitywarrantassets.Thisratioexcludesinvestment securities certainfinancialitemswhere performance is Ratio– Core OperatingEfficiency exchange andlending-related fees, inaggregate. Core Fee Income – to ourinabilityprovideaquantitativereconciliation tosuchmeasure. reconciliation ofCore EPStotheclosestcorresponding GAAPmeasureisnotavailable withrespecttofuturegoals due financial itemswhereperformance istypically subjecttomarket orotherconditions beyondourcontrol.A measure tobeausefulassessmentofourperformance asitrelatestoourcore businessbecauseitexcludes certain warrant assets,netoftax;dividedbydilutedaverage common sharesoutstanding. Ourmanagement believesthis Core EPS – Non-controlling interests Net charge-off Customer RelationshipManagement (system) Corporate andFinancial Results Overview Comprehensive CapitalAnalysis &Review Low income housingtaxcreditfunds Venture Equity Capital/Private Net income available andequity tocommon stockholderslessgainsorlossesoninvestmentsecurities (Please see non-GAAP reconciliations (Pleaseseenon-GAAP attheendofthispresentationfor moreinformation) Fees clientinvestments,creditcards,depositservicecharges, foreign fromlettersofcredit, The sumofon-balance sheetdepositsandoff-balance sheetclientinvestment funds. – available-for-sale ("AFS") heldonthebalance sheet. ("HTM")securities andheld-to-maturity Non-interest expense dividedbytotalrevenue, afteradjustingfor gainsorlosseson February 1, 2019 – Net gains on investment securities include Net gainsoninvestmentsecurities 3 SVB 2014 4:3


 
Important information regarding forward-looking statements and use of non-GAAP financial measures  Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are neither historical facts nor assurances of future performance, and are subject to known and unknown risks and uncertainties, many of which may be beyond our control. You can identify these and other forward-looking statements by the use of words such as “becoming,” “may,” “will,” “should,” "could," "would," “predict,” “potential,” “continue,” “anticipate,” “believe,” “estimate,” “seek,” “expect,” “plan,” “intend,” the negative of such words, or comparable terminology. In this presentation, we make forward-looking statements discussing management’s expectations about, among other things: economic conditions; opportunities in the market; outlook on our clients' performance; our financial, credit, and business performance, including potential investment gains, loan growth, loan mix, loan yields, credit quality, deposits, noninterest income, and expense levels; our expected effective tax rate; and financial results, including the performance results of SVB Leerink for certain quarters in, and for the full year 2019, as well as 2020 and beyond. Although we believe that the expectations reflected in these forward-looking statements are reasonable, we have based these expectations on our current beliefs as well as our assumptions, and such expectations may prove to be incorrect.   We wish to caution you that such statements are just predictions and actual events or results may differ materially, due to changes in economic, business and regulatory factors and trends. Our actual results of operations and financial performance could differ significantly from those expressed in or implied by our management’s forward-looking statements. Important factors that could cause our actual results and financial condition to differ from the expectations stated in the forward-looking statements include, among others: market and economic conditions (including the general condition of the capital and equity markets, and IPO, M&A and financing activity levels) and the associated impact on us (including effects on client demand for our commercial and investment banking and other financial services, as well as on the valuations of our investments); changes in the volume and credit quality of our loans; the impact of changes in interest rates or market levels or factors affecting or affected by them, especially on our loan and investment portfolios; changes in the levels of our loans, deposits and client investment fund balances; changes in the performance or equity valuations of funds or companies in which we have invested or hold derivative instruments or equity warrant assets; variations from our expectations as to factors impacting our cost structure; changes in our assessment of the creditworthiness or liquidity of our clients or unanticipated effects of credit concentration risks which create or exacerbate deterioration of such creditworthiness or liquidity; variations from our expectations as to factors impacting the timing and level of employee share-based transactions; variations from our expectations as to factors impacting our estimate of our full-year effective tax rate; accounting changes, as required by Generally Accepted Accounting Principles (GAAP); and regulatory, tax or legal changes or their impact on us.   We refer you to the documents the Company files from time to time with the Securities and Exchange Commission, including (i) our latest Annual Report on Form 10-K; (ii) our latest Quarterly Report on Form 10-Q; and (iii) our most recent earnings release filed on Form 8-K. These documents contain and identify important risk factors that could cause the Company’s actual results to differ materially from those contained in our projections or other forward-looking statements. All forward-looking statements included in this presentation are made only as of the date of this presentation. We assume no obligation and do not intend to revise or update any forward-looking statements contained in this presentation, except as required by law. This presentation shall not constitute an offer or solicitation in connection with any securities.   Use of Non-GAAP Financial Measures To supplement our financial disclosures that are presented in accordance with GAAP, we use certain non-GAAP measures of financial performance (including, but not limited to, non-GAAP core fee income, non-GAAP noninterest income, non-GAAP net gains on investment securities, non-GAAP non-marketable and other securities, non-GAAP noninterest expense and non-GAAP financial ratios) of financial performance. These supplemental performance measures may vary from, and may not be comparable to, similarly titled measures by other companies in our industry. 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. A non-GAAP financial measure may also be a financial metric that is not required by GAAP or other applicable requirement.   We believe that these non-GAAP financial measures, when taken together with the corresponding GAAP financial measures (as applicable), provide meaningful supplemental information regarding our performance by: (i) excluding amounts attributable to non-controlling interests for which we effectively do not receive the economic benefit or cost of, where indicated, or (ii) providing additional information used by management that is not otherwise required by GAAP or other applicable requirements. Our management uses, and believes that investors benefit from referring to, these non-GAAP financial measures in assessing our operating results and when planning, forecasting and analyzing future periods. These non-GAAP financial measures also facilitate a comparison of our performance to prior periods. We believe these measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry. However, these non-GAAP financial measures should be considered in addition to, not as a substitute for or superior to, net income or other financial measures prepared in accordance with GAAP. Under the “Non-GAAP reconciliations” section at the end of this presentation, we have provided reconciliations of, where applicable, the most comparable GAAP financial measures to the non-GAAP financial measures used in this presentation, or a reconciliation of the non-GAAP calculation of the financial measure. Please refer to that section for more information. Additionally, from time to time, we may make reference to the non-GAAP financial metric of Core EPS in our earnings call and other investor presentations. Non-GAAP Core EPS consists of our net income available to common stockholders less gains or losses on investment securities and equity warrant assets, net of tax, divided by our diluted weighted average common shares outstanding. Our management believes this measure to be a useful assessment of our performance as it relates to our core business because it excludes certain financial items where performance is typically subject to market or other conditions beyond our control. A reconciliation of Core EPS to the closest corresponding GAAP measure is not available with respect to future goals due to our inability to provide a quantitative reconciliation to such measure. Q4 and FY 2018 Corporate Overview and Financial Results February 1, 2019 4


 
Q4 and FY 2018 Q4 andFY About SVB Corporate andFinancial Results Overview February 1, 2019 5 SVB 2014 4:3


 
SVB: A unique financial services company Over 35 years of focus on innovation companies, investors and influencers Strong market position Robust client funds franchise Diversified revenue streams $58B assets Global presence $27B loans $134B total client funds Average balances for Q4'18 Q4 and FY 2018 Corporate Overview and Financial Results February 1, 2019 6


 
(Early Stage) Accelerator Revenue <$5M Q4 and FY 2018 Q4 andFY Technology +LifeHealthcare Sciences Corporate andFinancial Results Overview $5M-$75M Growth Revenue February 1, 2019 Innovation Economy We serve theglobal Corp Fin Corp Revenue >$75M Venture Capital Private Equity Investors Investors, Executives Entrepreneurs, Individuals Influencers: 7 SVB 2014 4:3


 
Serving innovative companies and the investors and individuals behind them Silicon Valley SVB Private SVB Capital Bank Private venture Bank/Wealth SVB Leerink Global commercial investing Advisory Investment banking banking expertise, oversight Private banking and services focused on for innovators, and fund management investment strategies for healthcare and life enterprises influencers in the science companies and investors innovation ecosystem Q4 and FY 2018 Corporate Overview and Financial Results February 1, 2019 8


 
Chief Operations Officer, Mike Dreyerwhowill retire inApril. 10,* OnJanuary 2019, weannounced theappointment ofPhilCox (effective1,2019) asthenewChiefOperationsOfficer April toreplace ourcurrent A strong, seasoned management team • • Q4 and FY 2018 Q4 andFY Diverse experience andskillsets to helpdirectourgrowth Average tenureof13years atSVB 2 years atSVB CHIEF RISKOFFICER Laura Izurieta 6 years atSVB CHIEF MARKETINGOFFICER Michelle Draper 23 years atSVB HEAD OFTECHNOLOGY BANKING John China 2 years atSVB CHIEF FINANCIALOFFICER Dan Beck Corporate andFinancial Results Overview February 1, 2019 3 years atSVB CHIEF OPERATIONS OFFICER Mike Dreyer 10 years atSVB PRESIDENT OFTHEUKBRANCH HEAD OFEMEAAND Phil Cox years26 atSVB SVB FINANCIALGROUP PRESIDENT ANDCEO Greg Becker * * 5 years atSVB GENERAL COUNSEL Michael Zuckert 15 years atSVB OFFICER CHIEF HUMANRESOURCES Chris Edmonds-Waters 13 years atSVB SILICON VALLEY BANK PRESIDENT Mike Descheneaux 27 years atSVB CHIEF CREDIT OFFICER Marc Cadieux 9 SVB 2014 4:3


 
Q4 and FY 2018 2018 Corporate andFinancial ResultsQ4 andFY Q4 andFY Overview Results Overview of Corporate andFinancial Results Overview February 1,2019 February 1, 2019 10 SVB 2014 4:3


 
StrongQ4'18 Market market Factors tailwinds contributed to record results throughout 2018 Strong Liquidity Higher Interest Rates Lower Taxes & • Record VC investment of • Fed Funds +100 bps Regulatory Relief $131B (Mar, Jun, Sep, Dec) • Tax Cuts & Jobs Act • Strongest pace of U.S. VC- • 1M LIBOR +96 bps passed December 2017 backed, Tech/Life Science • 3M LIBOR +110 bps • CCAR threshold lifted IPOs since 2014 • 5Y Treasury +26 bps June 2018 • Healthy valuation trends in private markets Q4 and FY 2018 Corporate Overview and Financial Results February 1, 2019 11


 
2018 takeaways EPS: $18.11 Net Income: $974M • Outstanding Growth (vs. 2017) • Warrant gains: $89M – Average total client funds: +30.6% • Investment gains, net of NCI: $50M – Average loans: +21.1% • Efficiency ratio: +45.0% – Net interest income: +33.3% • Return on equity: 20.57% (12.38% – Core fee income: +36.1% in 2017) • Stable credit quality • Non-interest expense: +17.6% • Bank Tier 1 Leverage ratio: 8.10% (vs. 2017) (+54 bps vs. 2017) – Investments in people, – Infrastructure investments to support our growth – Enhancements to our risk and compliance infrastructure Q4 and FY 2018 Corporate Overview and Financial Results February 1, 2019 12


 
Q4'18 takeaways EPS: $4.96 Net Income: $266 million • Outstanding Growth (vs. Q3'18) • Return on equity: 20.61% – Average total client funds: +4.3% • Efficiency ratio: +43.9% – Average loans: +4.4% • Stable credit quality – Net interest income: +4.3% • Bank Tier 1 Leverage ratio: 8.10% (+28 – Core fee income: +10.9% bps) • Non-interest expense: -0.6% (vs. Q3'18) • Leerink acquisition announced on • Warrant gains: $16.7M 11/13/2018 (closed 1/4/2019) • Investment gains, net of NCI: $1.8M, • Repurchased $147M of $500M authorized impacted by Q4 volatility in public markets share repurchase program Challenges • Public market volatility • Impact of market liquidity on valuations and technology loan growth • Achieving right balance of on- vs. off-balance sheet client fund mix • Market anxiety over U.S. - China trade war and weakening global economic indicators • Competition from banks, non-banks and market liquidity Q4 and FY 2018 Corporate Overview and Financial Results February 1, 2019 13


 
2) 1) Return onaverage assets equity Return onaverage SVBFG stockholders’ Effective taxrate Net charge-offs /Average total grossloans ratio operatingefficiency GAAP Non-interest expense controlling interests non-interestincome,Non-GAAP netofnon- non-interestincomeGAAP Net interestincome Net interestmargin Average fixed-income securities Change Average off-balancesheetclient inv. funds Change Average deposits Change Average loans Change Average assets stockholders Net income available tocommon Diluted earnings pershare Annual highlights 2017 is$37.6M ofadditional income taxexpense duetotherevaluation ofdeferred tax assetsandinvestmentsinlowincome housingtaxcreditfunds following taxreform. Our effectivetaxrate iscalculatedbydividingincome taxexpense by the sumofincome before income taxexpense tononcontrolling andnetincome interests.Included in attributable Please seenon-GAAP reconciliations atend of thispresentationfor more information Q4 and FY 2018 Q4 andFY 2 1 Corporate andFinancial Results Overview $856.6M $700.7M $263.9M $352.5M $572.2M 49.04% 10.46% 41.02% $30.0B $33.0B $16.6B 0.80% $28.3B 44.4% $11.5B 24.0% 42.0% 0.32% 23.0% 2.81% $5.31 2014 February 1, 2019 $1,006.4M $780.0M $343.9M $472.8M $441.1M 39.95% 52.73% 11.18% $40.8B $14.8B $36.3B $39.2B 0.84% 0.30% $22.3B 30.6% 28.2% 28.3% 2.57% 23.9% $6.62 2015 $1,150.5M $448.5M $456.6M $859.8M $382.7M 10.90% 53.50% 39.55% $44.0B $43.4B $38.8B 0.46% $18.3B $21.5B 0.87% 23.8% 10.5% 2.72% 6.8% 2016 $7.31 7.7% $1,420.4M $1,010.7M $490.5M $527.8M $557.2M 42.02% 12.38% $48.4B 51.11% $22.4B $42.7B $51.5B $21.2B 3.05% 10.0% 0.27% 18.8% 1.01% 10.3% 15.7% $9.20 2017 $1,894.0M $1,188.2M $745.0M $707.0M $973.8M 45.02% 20.57% 26.52% $24.8B $48.1B $25.6B $55.2B $75.1B 0.22% $18.11 45.7% 1.76% 3.57% 14.2% 12.5% 21.1% 2018 14 SVB 2014 4:3


 
Quarterly highlights 2) 1) Return onaverage assets(annualized) (annualized) Return onaverage SVBFG stockholders’equity Effective taxrate (annualized) Net charge-offs /Average totalgross loans Non-interest expense controlling interests non-interest income,Non-GAAP netofnon- non-interest incomeGAAP Net interestincome Net interestmargin Average fixed income securities Change Average off-balancesheetclient investment funds Change Average deposits Change Average loans Change Average assets Net income available tocommon stockholders Diluted earnings pershare reform. Q4'17 included$37.6M ofadditionalincometaxexpense duetotherevaluationof deferred taxassetsandinvestments inlowincomehousingtaxcredit fundsfollowingtax Our effective taxrateiscalculated bydividingincometaxexpense bythesumofincomebefore incometaxexpenseandnet attributabletononcontrolling interests. This isanon-GAAP measure.Pleaseseenon-GAAP reconciliations atendofthispresentationformoreinformation. Q4 and FY 2018 Q4 andFY 2 Corporate andFinancial Results Overview 1 February 1, 2019 $264.0M $144.5M $393.7M $152.3M $117.2M 53.54% 11.09% $44.8B $50.8B $22.4B $57.6B $23.8B 0.92% 0.23% 3.20% Q4'17 $2.19 4.0% 2.0% 8.1% 1.7% $419.9M $265.4M $195.0M $142.5M $155.5M 27.50% 18.12% $64.4B $24.0B $46.1B $52.4B $23.8B 0.15% 3.38% 1.51% 11.8% Q1'18 $3.63 3.0% 6.1% 3.1% $466.4M $305.7M $237.8M $183.2M $192.7M 20.82% 24.53% $48.0B $54.4B $24.9B $25.2B $71.3B 0.22% 3.59% 10.8% 1.75% $4.42 Q2'18 4.0% 4.4% 3.8% $309.4M $203.4M $493.2M $274.8M $210.1M 22.46% 25.75% $79.6B $49.1B $56.5B $26.3B $25.5B 0.30% 3.62% 1.93% 11.6% Q3'18 $5.10 5.9% 3.9% 2.3% $307.6M $266.3M $186.7M $514.5M $177.9M 20.61% 28.28% $85.0B $49.1B $24.5B $57.6B 0.20% $27.5B 3.69% 1.83% $4.96 Q4'18 4.4% 6.9% 1.9% —% 15 SVB 2014 4:3


 
$ Millions $ Billions Key performance indicators $ $ $ $ $ $ $ $ $ $ $ 2 1 1 1 1 2 3 1 $ 1 2 $ 1 $ $ , , , Q4 and FY 2018 Q4 andFY , , , 0 0 0 0 5 5 5 0 0 4 6 6 8 8 2 n 0 0 0 0 0 0 0 0 e 0 0 0 0 0 0 0 0 N t $ 2 1 0 o e A 1 1 f 2 t $ . 4 v 5 0 8 u I e 5 1 n n 4 r $ 7 2 Corporate andFinancial Results Overview t a 1 e 0 e $ 4 g a 1 2 1 . r 5 8 e , r 0 e 0 n 1 s 0 L 5 e $ 2 t 6 o 1 0 d 8 $ I a 1 2 1 n . 6 i n 0 3 , n 1 c 1 s 5 o c 6 , $ 2 1 o m 2 0 $ 1 m 2 1 1 e . 0 , 7 2 4 e 1 2 7 $ 0 2 2 0 $ 5 2 1 1 . 0 , 8 6 8 1 9 8 4 February 1, 2019 $ Millions $ Billions $ $ $ $ $ $ $ $ $ $ $ 4 5 2 3 4 1 $ 5 2 3 1 1 0 A 0 0 0 0 5 5 $ 5 5 5 5 5 0 0 0 0 0 0 0 0 0 0 0 0 0 v e C l r i e $ $ $ a 2 2 $ C n 3 5 2 0 0 2 t g 0 o 8 8 i 1 1 1 n e . . . 0 r 4 4 v 0 3 3 . e T f u o $ $ $ n F 2 2 $ d 3 3 7 2 0 0 t e s 6 9 5 a 6 1 1 e . . . 5 5 5 l 5 2 3 I C n $ $ $ 2 l 2 $ 4 c 3 i 8 0 0 3 e 8 3 o 2 1 1 1 . . n . 6 6 6 m 8 4 2 t D e e F $ $ $ 2 $ 2 p 9 4 5 u 0 3 o 0 4 s 1 2 7 1 1 n i . 9 . t . 7 7 5 s 7 2 d s $ $ 2 $ $ 2 1 4 0 7 5 0 2 5 8 1 1 1 3 6 . 8 . 8 . 1 1 2 $ Millions $ $ 0 4 5 2 3 1 1 1 $ $ $ $ , % % % % % % , 0 4 6 8 2 2 0 0 0 0 0 0 N $ 0 0 0 0 0 0 0 o 2 2 n . 0 8 N i 2 $ 1 1 n 0 7 % 4 e t 0 1 t e 4 1 2 r I 2 . $ 2 e 0 5 n 7 0 7 1 s t 8 % 5 1 e t 0 5 r E e 2 $ 2 2 x . 8 s 0 0 7 p 6 t 2 1 1 e 6 0 % 6 M n $ 2 1 a 3 s 0 2 , . e r 0 0 0 1 g 1 7 5 1 1 i % 7 $ n 2 1 0 , 3 1 2 1 . 8 8 0 5 8 7 1 % 8 16 SVB 2014 4:3


 
Q4 and FY 2018 2018 Corporate andFinancial ResultsQ4 andFY Q4 andFY Overview Term Financial Targets 2019 Outlook andLong- Corporate andFinancial Results Overview February 1,2019 February 1, 2019 17 SVB 2014 4:3


 
Assumes nointerest rate increases 2019 5) 4) 3) 2) 1) 2019 full-year outlook Non-interest expense (excluding expenses Outlook doesnotassumeanyfuturerateincreases change, andactualresultsmaydiffer, basedonourperformancerelativetointernaltargets. Our outlookfornoninterestexpenseispartlybasedonmanagement's currentforecastofperformance-basedincentivecompensationexpenses.Suchforecastsaresubjectto investors. See"UseofNon-GAAP Financial Measures"attheendofourquarterlyearningsreleaseforfurtherinformationregardingcalculationandlimitationsthismeasure. noninterest expenseforfiscal2017isincludedinthispresentation, aswebelievesuchreconciliationwouldimplyadegreeofprecisionthatbeconfusingormisleadingto presented withoutunreasonable efforts, noreconciliationfortheoutlookofnon-GAAP noninterestexpense(excludingexpenses relatedtononcontrollinginterests)GAAP to noncontrollinginterests. As weareunabletoquantifysuch line itemsthatwouldberequiredtoincludedinthecomparable GAAP financialmeasureforthefutureperiod Noninterest expense(excludingexpenses relatedtononcontrollinginterests)isanon-GAAP measure,whichrepresentsnoninterestexpense,but excludesexpensesattributable release forfurtherinformationregarding thecalculationandlimitationsofthismeasure. believe suchreconciliationwould implyadegreeofprecisionthatwouldbeconfusingormisleading toinvestors.See"UseofNon-GAAP Financial Measures"attheendofthis presented withoutunreasonable efforts, noreconciliationfortheoutlookofnon-GAAP corefeeincometoGAAP noninterestincomeforfiscal2017isincludedinthisrelease, aswe conditions beyondourcontrol. As weareunabletoquantifysuch lineitemsthatwouldberequiredtoincludedinthecomparable GAAP financialmeasureforthefutureperiod Core feeincomeisanon-GAAP measure,whichrepresentsnoninterestincome, butexcludescertainlineitemswhereperformanceistypically subject tomarketorother described under the section"Forward-LookingStatements". cash intoinvestment securities.Suchforecastsare subjecttochange,andactualresults maydiffer, basedonmarketconditions, actualprepaymentratesand otherfactors Our outlookfornet interestincomeandnet marginisbasedprimarilyonmanagement's currentforecastofaverage depositandloanbalances anddeploymentofsurplus Core fee incomeinvestment with banking Allowance for loanlossesfor totalgross Non-performing loans/totalgrossloans Non-performing Current fullyear 2019 outlookcompared to2018results,includingexpected resultsofSVB Leerinkreflectiveofthecompleted Non-interest expense (excluding expenses Non-interest expense investment with performing loansasa%oftotalgross performing 3) 2) 1) related tonon-controlling interests) Q4 and FY 2018 Q4 andFY related tonon-controlling interests) 4, 2019. Current fullyearoutlookfor2019 comparedtofull-year2018results,includingexpectedresultsofSVB LeerinkreflectiveofthecompletedacquisitiononJanuary Non-GAAP measure. complete informationonmanagement's assumptionsandforecastsregardingthisoutlook. As of 1/24/2019 Net loancharge-offs Net interestincome Net interestmargin banking activities Effective Tax Rate Average deposits performing loans performing Preliminary Core fee income Business Driver Average loans Corporate andFinancial Results Overview activities Net loancharge-offs Net interestincome ; comparedtofull-year2018results; assumesnorateincreases;pleaseseeourmostrecentFinancial Releaseandearningscalltranscriptfor Business Driver Average deposits Core fee income Average loans 3 2 3 2 2019 FullYear Outlookvs. 2018FullYear February 1, 2019 Increase atapercentage rateinthehigh Increase atapercentage rateinthemid outlook acquisition on January 4, 2019 4, acquisition onJanuary Between 0.20% and0.40% ofavg. Increase atapercentage ratein Increase atapercentage ratein Increase atapercentage ratein Increase atapercentage ratein Increase atapercentage ratein Between 0.30% and0.50% of Between 3.80%and3.90% Between 26.0% and28.0% Comparable to2018levels the highsingledigits total grossloans total grossloans the highteens the highteens the midteens the midteens Results thirties sixties 1 2018 FullYear Outlookvs. 2017 Full Increase atapercentage ratein Increase atapercentage ratein Increase atapercentage ratein Increase atapercentage ratein Increase atapercentage ratein Between 0.30%-0.50% ofavg. (as of the highteenstolowtwenties the mid-teenstohighteens the lowdoubledigits the highsingledigits total grossloans 1/24/2019 Year Results the mid-teens Outlook increased No outlookprovided preliminary No outlookprovided preliminary No outlookprovided preliminary No outlookprovided preliminary previous outlookofmidteens Change from10/25/18 ) Not applicable Not applicable No change No change No change No change No change tohighteensfrom 18 SVB 2014 4:3


 
2019 Expense Growth Investment Priorities Driving • • • • • • Strategic Priorities: Risk management Digital Bank mobility tools)&scalability Employee enablement(CRM, data infrastructure andgoverningDigitizing onboarding) (including client andloan Global onboarding transaction volumes andprocessing costs Core feehigher income initiatives growth drive Q4 and FY 2018 Q4 andFY Fee Income Growth Initiatives: ~10% Corporate andFinancial Results Overview ~15% Priorities Strategic Growth Income Fee February 1, 2019 Other People and better support thebank support and better term revenueopportunities growth initiatives toimproveHiring long- • • • • • • • Support volume growth Support Competitive pay inhigh-cost markets Risk management Relationship Management Front sales office expansion Bank/Wealth Advisory Private Germany andCanadaexpansion People: ~70% 19 SVB 2014 4:3


 
◦ ◦ ◦ Target Outcomes as onboarding processes, such speed key Streamline and meaningful ways clients inmore engage with Enable usto support our growth Investing to improve operating leverage and Enhance Client 2020 expense ratetarget: growth highsingle digits processes andimplementation ofscalablesolutions Improved futureoperating leverage for withnew opportunities Expanded productofferings Through systems, tools,processes, analytics andpeople Experience Q4 and FY 2018 Q4 andFY Corporate andFinancial Results Overview activities value add spent onnon- Minimize time performance optimize their Help employees Enablement Employee Improve throughtransformation ofkey business February 1, 2019 frameworks governance quality and Enhance data organization issues acrossthe resolution of effective timely,Support Enhance Risk Management revenue growth term overlong growth of efficiency Improve efficiencies Optimize cost Drive Scalable Drive Long-term Growth Growth Advisory Bank andWealth Expand Private Canada to Germanyand Extend platform platform across the penetration Improve product client needs address evolving to offerings Expand product Drive RevenueDrive Growth 20 SVB 2014 4:3


 
Deposit Franchise aCompetitive Advantage • • Q4 and FY 2018 Q4 andFY 0 0 0 0 0 1 1 1 . . . . . . . FY 2018 FY Client operatingaccounts ofourdeposits make upthemajority . 0 0 4 4 8 6 2 2 ** WhereFY 2018datawas notavailableasofFebruary1,2019, YTD 9/30/18 costoftotaldepositswas reported. availablefull-year 2018costoftotaldepositsas reportedbyS&P GlobalMarketIntelligence. * “Peers”refers topeergroupasreportedinour proxy statementandaresubject to changeonanannualbasis.Peer dataisbasedonthemostrecently % % % % % % % % ◦ ◦ ◦ 0 Low loan-to-depositratioof53.3% Low depositbetaof22% interest-bearing Cost oftotaldeposits 6bps,materiallylower thanpeercosts . 0 Corporate andFinancial Results Overview SIVB 6 0 . 2 CMA 2 0 . 2 CBSH 3 0 . 2 ZION 5 0 . 2 S CFR** 6 V B 0 February 1, 2019 . C 2 RF 6 o s t 0 o . 2 f MTB** 7 T o 0 t . a 3 4 NTRS** l D e 0 . p 3 o BOKF** 9 s i t 0 s . 4 v FRC 1 s . 0 P . 4 e WBS 2 e r s 0 * . 4 UMPQ 5 0 . 4 HBAN 9 0 . 7 EWBC 1 0 . 7 ASB 3 0 . 8 SBNY 2 1 . 1 NYCB** 9 21 SVB 2014 4:3


 
E T life-stages, withInternational PE/VCrepresenting 9%oftotaldepositsand1%off-balance sheet clientinvestmentfunds. ** Internationalbalances isamanagementviewof clientnichesanddoesnottieto regulatorydefinitionsforforeign exposure. Internationalbalances includeclientsacrossallclientniches and * Depositandoff-balance sheetclientinvestmentfundsbalancesbyportfolio is amanagementviewofclientnichesandsubjecttochange. e a c r l h y n at 12/31/18 Total Client Funds Contributions by Niche - S o E 3 t l a o a 2 r & Healthcare Life Science g g Early-Stage l % Q4 and FY 2018 Q4 andFY y e y - S t a S g c e i e L n 9 i c % f e e Corporate andFinancial Results Overview D e p o s i t s 6 T * e % c h n 2 U 2 H L o 2 i % . e f l S % e o a . l g S P t y h c E c i / February 1, 2019 e a V n r C e c e 2 I 3 P n 4 & % t r % e i v r a n 2 O t a % t e t h i B e o a r n n a k l * * E a r E T & Healthcare Life Science l Early-Stage e a y c r - S l h y t n - a S S o g 2 c t l e o i a 0 e 2 g g O % L n 1 e y i f c % f f e e - B a l a U n . c S e . P S E h 1 / e 1 V e % C t C l i e n t I n v e s t m 1 P e % 4 I r n i n % v t t a e F t r u e n 2 T n a B e 9 d t c a % i 1 H L s h o n * 4 i e n n f k % e a o a l l l S t * o h c * g c i y e a n r 22 e c e & SVB 2014 4:3


 
support newandexistingsupport client needs Additional newproductsindevelopment to product development Continued on-balance sheet Driving on-balance sheet deposit growth balance sheetinQ4'18 deposited $1.6Bofnewfundsonthe coreMore than1,000 clients New Clients Q4 and FY 2018 Q4 andFY S V B A s s e Corporate andFinancial Results Overview t M a n a g S e w R m e e e p e n p o t $ 0 O f f - B February 1, 2019 a l $ a $ 1 n 8 0 c . e 4 S h e e t C l i e n $ t 2 F 0 u n products over thelong-term clients new areaddressablewith Approximately 10 balance sheet move tograduallyOpportunities d s B a i l t l i 1 o 2 n s / 3 1 / $ some 1 3 8 0 client fundson % -20 $ $ 4 3 $ 0 8 % 3 . 9 3 of Repo/Sweep . 2 $ 5 0 23 SVB 2014 4:3


 
Our market expectations for 2019 Positive influence from... • Healthy VC investment and fundraising • Another strong year for IPOs • Healthy liquidity and activity among SVB clients But with... • Fading market tailwinds • Macro challenges: ◦ U.S. - China trade war Fading market tailwinds, challenges...look at Greg's script. ◦ Equity market volatility Market volatility Fed monetary policy - unclear ◦ Potential U.S. Government closures Govt. Shutdown, IPO market economic impact • Continued intense competition Q4 and FY 2018 Corporate Overview and Financial Results February 1, 2019 24


 
Long-term financial targets 4) 3) 2) 1) environment EPS Core ROE growth smart Strong, sustainable, >10 <10 Asset Sensitivity Non-GAAP measure. Non-GAAP measure Normalized rateenvironmentrepresents FedFundsrateabove2.5%,lowenvironmentrepresents FedFundsatorbelow2.5% Excludes impactofSVBLeerink revenue andexpense Q4 and FY 2018 Q4 andFY % % 3 environment inup100bpsscenario ~20 ~10 rate ~20 ~15 in down 100bpsscenario Corporate andFinancial Results Overview % % % % environment in growth ina growth growth ina growth in a low rate normalized environment rising rate rising flat rate February 1, 2019 Loan-to-Deposit ratio ~7-8 Bank Tier 1Leverage ratio Strong Capital&Liquidity Low Rates Normalized Rates leverage operating Investments ingrowth&improved <70 Mid-50 Mid-40 % % 1,2 % % Core Efficiency Ratio Core Efficiency Core Efficiency Ratio Core Efficiency 4 25 SVB 2014 4:3


 
Q4 and FY 2018 2018 Corporate andFinancial ResultsQ4 andFY Q4 andFY Overview (Balance Sheet)(Balance Financial Performance Corporate andFinancial Results Overview February 1,2019 February 1, 2019 26 SVB 2014 4:3


 
Q4'18 Q4 and FY 2018 Q4 andFY Growth driven primarily by Private Equity, by Private primarily driven Growth Life Science & Billions $ $ $ $ Corporate andFinancial Results Overview : average loansgrew 2 3 2 1 0 0 5 5 Q $ $ 2 2 4 2 3 ' Healthcare and Private Bank Healthcare andPrivate 1 . . 4 1 7 A v e r a February 1, 2019 g $ Q $ e 2 2 1 l 4 3 o ' 1 . . a 8 8 6 n s $ Q $ 2 2 2 6 4 ' 1 P . . 0 9 8 e 4.4% r i o d - e n Q $ $ d 2 2 3 l 6 7 ' o 1 . . a 5 8 3 n s Q $ $ 2 4 2 8 7 ' 1 . . 5 3 8 27 SVB 2014 4:3


 
P Wine $1.0 3% Q4'18: Adiversified loanportfolio r i v a t e Q4 and FY 2018 Q4 andFY B $ 1 a 3 1 n Gross Loans: . % 0 V k P e r i n v t a u Corporate andFinancial Results Overview $ 4 t r 1 e e 9 4 O E % C . $ q t 1 a 0 2 h u p % e . i i 5 t r t y a / l 3 $28.5 S billion I o n f 2 $ t t e 6 2 w r % . a n 2 February 1, 2019 r e e t / 1,2 Life Science/ Healthcare $2.5, 9% $1.2, 4% Hardware Technology andLife Science/Healthcare Only 3) 2) 1) Primarily capitalcalllinesofcredit Primarily loans) inourearnings releasesandourForm 10-Kand10-Q reports. Bankincludes loansdesignatedasConsumerPrivate Loans (includingreal estatesecured As of 12/31/2018 $9.9 billion ; grossloansdonot includedeferred fees andcosts. Sponsored Buyout Non-Early Stage Balance Sheet Early Stage $2.4 $2.1 $1.7 $1.4 $2.3 Other ( ( ( ( ( ( 35% 8% 6% 8% 5% 8% ) ) ) ) ) ofGrossLoans) is asset-based lending Investor-dependent 2 Investor-dependent 1 Cash flowdependent2 Cash flowdependent1 covered by current Cash flowandhybrid Revenue: $0-$5M Revenue >$5M Balance-sheet assets; dependent $1.0B 28 1 SVB 2014 4:3


 
Our loan portfolio has evolved over time • Private Equity has driven the majority of recent growth, although we have seen growth in all niches • Our Private Equity portfolio has historically been characterized by lower yields (relative to the rest of our portfolio) and high credit quality Loans, net of unearned income $30 $28.3 12% o i 11% l o f 10% $1.2 t r $25 $23.1 $2.4 10% o 9% 9% p n 8% 8% $19.9 $1.2 $3.0 a o $20 $1.8 8% l f o s $1.2 $16.7 $2.6 $6.2 n $1.9 % o i $14.4 s l $15 $1.1 6% l $2.2 a i $1.7 $6.2 6% s B $1.1 $10.9 $1.3 $1.8 n a $8.9 $1.3 $5.6 o $10 4% l $7.0 $5.4 e $5.0 $14.1 g $5.5 a $4.5 t $10.0 s $5 $4.1 2% - $7.7 y $3.3 l $2.5 $4.6 $5.5 r $1.4 $1.8 $2.4 a $1.7 E $0 $0.9 $1.0 $1.1 0% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Private equity/venture capital Hardware Software/internet Premium wine Private Bank Other Life science/healthcare Early-stage loans as % of loan portfolio Q4 and FY 2018 Corporate Overview and Financial Results February 1, 2019 29


 
Loans larger than $20M are primarily Private Equity capital call lines, which have a history of no credit losses Capital call lines have maturities of <1 year and are secured by contractual capital commitments and the invested assets of the fund borrowers. Gross loans to any single client equal to or greater than $20 million $14.5 $15 $14.6 $10.5 $2.3 $10 $8.9 s n o i $2.2 l $6.8 l i $6.2 B $1.9 $4.2 $10.1 $5 $4.3 $1.9 $$3.13.2 $1.9 $6.8 $2.2$2.1 $1.6 $5.3 $1.3 $1.0 $1.3 $1.1 $3.1 $3.6 $0.7 $1.0 $1.5 $0 $0.5 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Private equity/venture capital Private Bank Software/internet Premium wine Life science/healthcare Other Hardware Q4 and FY 2018 Corporate Overview and Financial Results February 1, 2019 30


 
Private Equity capital call lines: High growth, diversification, low credit risk • High-quality, strong underwriting • Strong secondary markets • No credit losses in history of product PE/VC Fund Commitments by Investment Style and Industry* Investment Style Industry PE - Real Estate Other PE - Other Energy 5% PE - Fund of Funds Infrastructure Technology 7% Natural Resources 10% PE - Debt 24% FinTech 9% 2% 24% Life Sciences 5% Real Estate 5% 12% VC Funds 7% Industrial 24% 27% 16% 9% Fund of Funds PE - Growth Debt PE - Buyout 10% Consumer * PE/VC portfolio by investment style and industry is based on fund commitments as of 9/30/18 Q4 and FY 2018 Corporate Overview and Financial Results February 1, 2019 31


 
Q4'18 • • Q4 and FY 2018 Q4 andFY Millions Millions Allowance for loanlosses/totalgrossloans:at Provision for creditlossesof $ $ $ $ $ $ 1 2 $ 1 $ 1 2 $ 1 0 0 0 0 5 5 $ 5 5 5 0 0 0 0 Corporate andFinancial Results Overview : Credit quality remained stable $ 0 $ Q 1 0 . 1 Q 4 2 2 1 . . 4 ' 3 5 N 9 9 1 % ' 1 o 7 . 1 M 5 % n 7 M - p e r f o r m i n g l N N o 0 $ $ Q a e e 0 1 8 Q . n t t 1 1 . 1 . s 1 4 ' c c 5 8 6 February 1, 2019 1 / ' h h 7 % 1 M t 8 . a a 7 o % 8 r r M t g g a e e l - - g o o r f f o f f s s s s / $13.6M a l v o e a r n a s g $ $ 0 Q 0 e 1 1 Q . 2 . 3 2 2 t 2 4 ' o . 5 2 1 ' 5 8 t 1 % . 8 M a 3 % 8 l M (vs. g r o T o s s t a l l o n a 17.2M o n n s - ( p a $ $ e 0 n 0 Q 2 1 Q r n . f . 0 1 3 3 3 4 o u 5 ' 0 . 0.99% ' r a 1 2 0 1 . m in % l 8 3 % 8 M i M z i n e g d ) l Q3 o a n s ) (vs. $ $ 0 0 Q Q 1 9 . . 4 3 4 2 3 6 . 0 ' ' 4 1.03% . 1 9 1 1 % % 8 8 M M 0 0 0 0 0 0 1 in . . . . . . . 0 0 2 4 6 0 5 % % % % % % % Q3 ) 32 SVB 2014 4:3


 
Five non-dot-com loansdrove through market cycles History ofhigh credit quality andresilience (2000: Dot-com bust) - 0 4 2 3 1 1 % % % % % % increase inNCOs Q4 and FY 2018 Q4 andFY 1 3 2 . . 0 0 3 0 2 7 % % 0 48% Technology 30% Early-Stage % oftotalloans Corporate andFinancial Results Overview 2 2000 0 0 2 2 0 Five problemloansdrove short- 0 (2008-2009: Financial Crisis) (2008-2009: Financial Crisis) lived spike inNPLs andNCOs 4 Net charge-offs asa%ofaverage totalgross loans loansas a %oftotalgrossloans Non-performing loans Non-performing 2 0 February 1, 2019 0 6 1 2 . 0 5 47% Technology 14% Early-Stage 7 0 % oftotalloans % 8 2 . 6 2007 4 % 2 0 1 0 2016), onenewCorporate Finance loanaddedin NPLs duetofour elevatedsince Q2'15primarily Sponsored Buyout loans(twowere resolved in 2016 practice andtwoGrowth loans addedin Post-crisis NCOs remainbelow50bps 2 0 1 2 2 0 1 4 2017 26% Technology 6% Early-Stage % oftotalloans 2 0 1 2018 6 0 0 $ 2 . . 9 0 3 2 6 4 2 1 . 8 % % 1 $ $ $ $ 5 1 1 0 0 5 0 0 0 Millions 33 SVB 2014 4:3


 
At 12/31/18 A high quality balance sheet Q4 and FY 2018 Q4 andFY 2) 1) $1.1, 2% $1.1, N Other e Non-marketable securities netofnon-controllinginterests were Net loansrepresents grossloansnetoftheallowance forloanlossesandunearned interestincome.Grossloansat $ 4 Period-end assets: t 2 9 l 8 o % . a 1 Corporate andFinancial Results Overview n s 1 C $ securities 6 maturity a 3 Held-to- % s $7.8B . 18% 6 h F LIHTC Investments) i s x securities Non-marketable e e F ( c d 1 i $ A s u x 4 7 $56.9B $0.8, 2% e i F r e n ( . % $ i c S 8 d 2 H t c u 1 ) i 7 o T i e 5 r n % m M i s . t c 5 i 2 e February 1, 2019 ) o e (VC & m s e $806 million . This isanon-GAAP measure. 2 I d b n Period-end liabilities: e $ e 2 Borrowings t p 1 e a 0 $1.3, 2% o 0 r r % e i s . n 2 i s t g t s - 12/31/2018 O $ b 2 t 1 h e % N . a e 1 o r r n i were n $ - 7 i g 3 n 6 9 d t $28.5B % e . e 1 r p e o s $51.7B s t i - t s 34 SVB 2014 4:3


 
Robust balance sheet growth Billions Strong growth inloansandsecurities Strong growth $ $ $ $ $ $ Q4 and FY 2018 Q4 andFY 4 6 5 2 3 $ 1 0 0 0 0 0 0 0 $ 2 3 0 9 1 Corporate andFinancial Results Overview . 4 3 Other assets Net loans VCNon-marketable (primarily &LIHTC securities investments) securities Held-to-maturity Available-for-sale securities $ 2 4 0 4 1 . 5 7 Assets $ 2 4 0 4 1 . 6 7 $ 2 5 0 1 1 . 7 February 1, 2019 2 $ 2 5 0 6 1 . 8 9 Billions Non-interest-bearing deposits= Non-interest-bearing $ $ $ $ $ $ 4 6 5 2 3 $ 1 0 0 0 0 0 0 0 79% $ 2 3 0 5 1 . 4 3 oftotaldeposits Non-interest-bearing deposits Non-interest-bearing Other liabilities Interest-bearing deposits Interest-bearing Borrowings $ 2 4 0 1 1 Liabilities . 5 4 $ 2 4 0 0 1 . 6 9 $ 2 4 0 6 1 . As of 7 9 12/31/2018 $ 2 5 0 1 1 . 8 7 35 SVB 2014 4:3


 
Billions investmentQ4'18: Ahigh-quality portfolio $ • • • $ $ 2 $ 1 $ 1 Q4 and FY 2018 Q4 andFY 0 0 0 5 5 Agency-issued rate collateralized residentialmortgage-backed –variable securities Agency-issued collateralized residentialmortgage-backed –fixed securities rate U.S. agencydebentures U.S. Treasury securities Available lines ofcreditinplaceliquidity toprovideshort-term U.S. Treasuries make up Liquid, fixed-income primarily adurationof with portfolio $ 2 1 0 3 A 1 . 4 v 5 Corporate andFinancial Results Overview a i l a b $ 2 l 1 e 0 6 - 1 f . o 5 4 r - S a l $ 2 e 1 0 S 2 1 . e 6 6 c u r i t i $ 2 e 1 0 s 1 1 . 7 1 February 1, 2019 20% 2 $ 0 7 1 . 8 8 ofinvestment portfolio Billions $ $ $ 2 $ 1 $ 1 0 0 0 5 5 Municipal bondsandnotes Agency-issued residentialmortgage-backed securities Agency-issued commercial mortgage-backed securities 2 $ 0 7 1 . 4 H 4 e l d - t 2 o $ 0 - 8 M 1 . 8 5 a t u r i t y 2 $ 0 8 S 1 e . 4 6 c u r i 3.8 years t i e $ 2 s 1 0 2 1 . 7 7 As of 12/31/2018 $ 2 1 0 5 1 . 8 5 36 SVB 2014 4:3


 
Billions Q4'18 • • • • $ $ $ 1 $ 1 Q4 and FY 2018 Q4 andFY 0 0 5 5 Billions initiatives, representing depositcosts increased10bps duetodepositgrowth Interest bearing Deposit betaremainedlow at22% Client investment funds grew( Healthy fundingandexit for ourclients activity drove client fundsgrowth $ $ $ 1 $ 1 T S M I $ $ 1 0 5 5 $ n 2 2 7 o w o 0 0 0 0 5 5 5 t t e . n a e b e l p y e a $ T A A A Corporate andFinancial Results Overview 0 Q : Average total client fundsgrew $ $ Q a v 1 o $ v v v d m $ 3 5 $ $ 4 . 0 r e t 7 e e e 4 1 e 7 A 7 5 a 1 7 i ' . a 2 r r r r 1 . 0 8 n . l ' v p a a a . . . 0 a 6 . r 1 7 2 5 1 e 4 a g g g g o % k g 7 r v e e e s e e a c e i o n i g t h r $ t n $ d $ Q f o e a s $ 1 d e t 6 f 3 e g n 1 e 1 - 8 T c e 8 i 4 b ' e p i 0 r o n 1 . k n p . a e . 2 o t 8 0 c . 4 t i l s o 5 a f l e n s a t i o l s r e n i - g C e b r t i n c / t s e $ s l e Q e $ t $ s s i t $ 1 i a e 3 7 - f a 2 s g 8 1 r i b u n 9 1 h ' v n i 9 n . 1 n e t 0 n . . 2 e Q i . 3 8 8 a d F $ $ g n $ f 3 e o . r 1 o u s 1 5 7 t 1 g f i d ' n r 2 n f . c . . 1 s e 4 e d i 1 7 $ $3 million g l % $ Q $ 8 p c i s i $ 1 February 1, 2019 e 4 7 o d e g 3 2 8 n 9 0 s e ' s n 8 . 1 t i . p 5 . t 6 . 8 6 f o o s 7 u s f n i f t d i 6.9% $ s Q $ c $ s $ 1 e 8 4 4 9 3 s 5 0 ' 4 . P 1 . 0 . 0 . 8 1 e 1 inadditionalinterestexpense r 0 i ), whileaverage depositsremainedflat Q o $ $ $ . 2 d 1 5 1 7 ' 2 . . . 1 E 0 5 8 % C T M 8 n i o d o m s i n 0 0 0 0 0 n t e e . . . . . g o 0 4 8 6 2 d y f % % % % % e m i p n a o t r e s k 0 0 r i Q t e e . . 4 s 1 1 t s 2 3 ' 0 Q t 1 d $ % % $ - $ 7 . e 3 b 6 1 1 7 S C p ' e 2 . . . 1 o p 8 0 0 o a % s 8 r 0 r s 0 e t Q i i a . . o n t 2 1 1 d f s ' g 0 4 1 i o % n % 8 Y d n t i e e e c r l p l d e i e o / s 0 0 Q n R t s . . - 2 t 1 3 i a b t ' 7 i t 1 1 e s n e % % 8 a 0 v Q r e $ $ $ . i 4 2 s n 1 6 8 t 4.3% 0 g ' . m . . 1 0 0 0 2 3 Q % d 8 e . . 3 3 e 1 n ' 8 p 8 t 1 o % % 8 f s e i e t s s 0 0 Q . . 4 4 1 9 ' 8 1 % % 8 37 SVB 2014 4:3


 
A history ofrobust client liquidity Recent clientdrivers: fundsgrowth Q4 and FY 2018 Q4 andFY Billions • • • $ $ $ $ 1 $ $ 1 $ 1 Healthy pace ofnewcore client acquisition Strong exit for ourclients activity Robust venture capital/private funding equity 0 4 4 6 8 2 2 $ 0 0 0 0 0 0 0 0 Corporate andFinancial Results Overview $ $ $ 2 $ 3 2 5 0 7 0 0 8 A A A A 1 . 9 . . . v v v v 4 0 4 4 e e e e r r r r a a a a g g g g e e e $ $ $ 2 e $ o n i 3 7 2 n 0 8 f o T 9 5 t f 7 n 1 e - . o . . b . 5 i r 5 8 5 t 2 n a e a t l s e l a t r n - C e b c l s e $ e $ $ 2 i t $ a e 4 - 8 3 s 0 r b 7 n h i 3 1 2 e 1 . n e t 6 . . . a 6 g e 2 4 1 F r t i d u n c e n g l p i February 1, 2019 d e o d $ $ $ n 2 s s e $ 9 t 3 5 i p 0 t 7 f 4 5 1 o s u 1 . s 5 . . . n 7 5 2 i 3 t d s s $ $ $ 2 $ 1 3 7 0 8 2 9 5 1 . 3 . 4 . 8 . 6 1 1 0 0 0 0 0 . . . . . 0 4 8 6 2 % % % % % 2 0 0 0 . 1 . 0 4 1 5 5 % % S C o p 2 0 0 s r 0 e . . t 1 0 0 a o 5 d f 6 6 Y i o % % n i n e t e l c d r l 2 e i 0 0 / e s 0 R n . . t 1 0 0 - t a b 6 i t 7 7 e n e % % a v r e i s n t g m 2 0 0 d 0 e . . e n 1 1 1 p t 7 2 1 o f % % s e i e t s s 2 0 0 0 . 1 . 3 8 1 7 5 % % 38 SVB 2014 4:3


 
Billions Expanding international business activity $ $ $ $ 1 $ $ Q4 and FY 2018 2018 Corporate andFinancial ResultsQ4 andFY Q4 andFY Overview $ 1 0 0 $11.2B 4 6 8 2 2 A v $ e $3.3B 0 international international 2 r 0 . a 8 $ g 1 L 3 e 4 o deposits* . 8 Corporate andFinancial Results Overview a I n n $ s 2 1 t loans* e . 0 1 $ r 1 n 6 5 * a . 5 t i $ o 2 1 Gateway; definitions for foreign thisisamanagement exposure anddoesnottietoregulatory segmentview Includes full-year average Israel, Asia loan anddepositbalances for andGlobal internationaloperationsinU.K., n . 0 a 5 $ 1 l 6 6 B . 6 D a $ l e a 1 2 p n . 0 o 9 c $ 1 s e 7 i 7 s . t 7 s * $ 2 2 . 0 $ 8 1 1 February 1,2019 February 1, 2019 0 8 . 4 Hong Kong Germany Location Canada Israel China U.K. Branch application inprogress Beijing, Shanghai,Shenzhen) Business development office Business development and (joint venture,in (joint offices SPD Silicon Valley Bank Representative office representative office Full service branch Full service Branch (lending) Description (Beijing) opened 2008 2005 2018 2012 2012 2013 Year TBD 39 SVB20144:3


 
Q4 and FY 2018 2018 Corporate andFinancial ResultsQ4 andFY Q4 andFY Overview (Income Statement) Financial Performance Corporate andFinancial Results Overview February 1,2019 February 1, 2019 40 SVB 2014 4:3


 
Q4'18 interest ratesdrove Q4'18 netinterestincome increase Higher average loanandinvestment balances andhigher Q4 and FY 2018 Q4 andFY Millions * $ $ $ $ $ $ 4 6 5 2 3 1 based on the federal statutory tax rate of 35 percent for periods prior to2018and21percent forbased onthefederal taxrateof35percent prior 2018 statutory for periods Net interest income ispresentedon afully taxableequivalent basistoconsistently andtax-exempt income reflect from taxableloansandsecurities securities 0 0 0 0 0 0 $ 0 0 0 0 0 0 0 Q N $ 9 4 Corporate andFinancial Results Overview e : Net interest income grew t 7 ' 0 . i 0 5 n 8 . t 3 e 9 r Q e % 4 s t ' 0 i n 9 c o m Q e 4 * ' 1 0 February 1, 2019 Q 4 ' 1 1 N e Q t 4 i n ' 1 t 2 e r e s Q t 4 m ' 1 a 3 r g i n Q 4 ' 1 4 Q 4 ' 1 5 4.3% F e d Q e r 4 a ' l 1 F 6 u n d Q s 4 t ' a 1 r 7 g e t Q r a 4 t ' e 1 0 3 6 9 2 3 $ 8 % 5 . . % % % 6 5 1 0 9 7 . % % 4 41 SVB 2014 4:3


 
Higher rates have driven margin improvement Interest Rates/Yields Q4 and FY 2018 Q4 andFY 1 0 0 5 % % % * Consolidated loanyields havebeenimpactedbythechange inthemixofourloanportfolio toPE/VC toTechnology loans,whichhavelowerloanyields incomparison andLife Science lending. Q 4 ' 0 Corporate andFinancial Results Overview 8 F N Q e e d 4 t e i ' n r 0 a t l e 9 r F e u s n t d m s Q a t 4 a r g r ' g 1 i n e 0 t r a t e Q 4 February 1, 2019 ' 1 1 Q 4 ' 1 L 1 o M 2 a o n n y t i h e Q l L d I 4 B ' O 1 R 3 Q 4 ' 1 4 2 . 5 Q 0 4 % ' 1 5 3 P r M i 4 v Q o a . n 4 4 t t e ' 8 h 1 E % L 6 q I u B i O t y R / V Q e 4 n t ' 4 u 1 9 r 7 e . 5 C 0 a p % 3 2 5 i Q t . . . a 4 6 5 4 l 0 ' 9 7 1 % % % 8 0 2 5 * 5 0 % % % PE/VC % of Loan Portfolio 42 SVB 2014 4:3


 
We maintain the benefits of asset sensitivity, with strategies to mitigate the downside Estimated net interest income could change as follows if short-term rates move +25 bps could increase net interest income by $68 million -25 bps could decrease net interest income by $69 million % Change in Base Case Drivers Changes in Net Interest Income 1) Impact of interest rate changes on: market as of interest rates • Reinvestment of fixed income (basis points) 12/31/2017 12/31/2018 portfolio cash flows • Variable rate loans and LIBOR- +100 13.3% 13.1% based investments -100 (15.7)% (13.3)% Primary benchmark indices: 2) Balance sheet growth and asset/ • Federal Funds target rate liability composition: • National Prime rate • Large non-interest bearing deposit funding base • 1-month LIBOR • Loan portfolio primarily variable • 3-month LIBOR rate * For more information, please refer to our sensitivity analysis included in our most recently filed quarterly reports pursuant to applicable SEC requirements. These estimates are reported on a pre-tax basis and are based on a static balance sheet and assumptions as of December 31, 2018. Actual results may differ. Simulations used to analyze interest-rate sensitivity may differ from actual results due to, among other things, differences in timing, frequency, and magnitude of changes in market rates; impact of competition; fluctuating business conditions and impact of strategies taken by management to mitigate these risks. Q4 and FY 2018 Corporate Overview and Financial Results February 1, 2019 43


 
while preservingthebenefits Reducing thedownsideofrate sensitivity 2019 Strategies • • • Q4 and FY 2018 Q4 andFY Sensitivity "Receive Fixed" RateSwaps -Convertloanstofixed variable-rate Portfolio CashFlows -Reduceby reducingnear-termcashflows sensitivity Loan income whenratesfall RateFloors-Preserve - - - - - - - - 1 1 1 1 1 1 1 1 4 6 5 3 4 5 2 3 . . . . . . . . 0 0 0 0 5 5 5 5 % % % % % % % % Corporate andFinancial Results Overview Driving to sensitivity of<10%to-100bpsshock tosensitivity Driving -15.7% Q 4 ' 1 7 February 1, 2019 Q 1 ' -14.0% 1 8 < 1 0 0 % b p C s h N a n I I g e S -13.7% e f Q r n o 2 s m i ' t 1 i 8 B v i a t s y e -12.9% Q 3 ' 1 8 -13.3% Q 4 ' 1 8 44 SVB 2014 4:3


 
Investment securities andwarrant gains Q4 and FY 2018 Q4 andFY Millions 3. 2. 1. $ $ $ $ $ 1 $ $ 1 1 $ 1 0 4 4 company that went public in the prior quarter.company thatwentpublicintheprior Despite thelossinQ1'18, totalnet gainsfromthisinvestmentwereapproximately $46million. In Q1'18, netofnon-controlling interestsincluded$22.2 millionoflossesfromthesaleshares fromexercised losses oninvestmentsecurities equitywarrantsinasingle This isanon-GAAP measure. onourabilityto selltheunderlyingand contractual securities. restrictions performance oftheunderlying portfoliocompanies, investordemandfor intheunderlying IPOs,fluctuations valuation ofthesecompanies, levelsofM&A activity, andlegal warrant assetsarecurrently unrealized.Theextent towhichsuchgains(or losses)willbecome offactorsincluding, realizedaresubjecttoavariety amongotherthings, The gains(or losses) resultingfromchanges invaluations portfolioandequity withinournonmarketable (fairvalues) andotherequitysecurities ofinvestmentsecurities 6 6 8 2 2 0 0 0 0 0 0 0 0 n N N e o e t t n o - g Corporate andFinancial Results Overview $ $ G 2 f a 3 7 0 A n i 1 0 n A o 1 . s . 4 n 0 P 7 o - n c n o e e n t $ $ 2 q t g 7 5 0 r u 1 a o 7 1 i . i . l t 5 0 n 3 l y i s n w o g a n $ $ i 2 r n 4 3 i r 0 n t a 3 7 e 1 v n . . 6 r 9 4 e t e s a s t s t m s s $ $ 2 2 e e 5 3 0 t n February 1, 2019 4 5 s t 1 . . 7 s 4 6 e c u $ $ r 2 i 4 8 0 t 9 i 9 1 e . . 8 s 9 1 Millions $ $ $ $ $ - 4 5 2 3 $ $ 1 5 5 5 5 5 5 5 s N N e o e c t n u Q $ - g $ r G 1 4 a 8 i t A 2 i ' . i n 1 . 0 A e 1 7 s s P o n n n e e Q $ - t e $ t 1 1 q o 3 9 g ' 1 u f . a . 8 8 2 i n i t n o y 3 s n w $ - Q ( $ c l a 2 1 2 o o r 6 9 ' s n r 1 . s . a t 2 4 8 1 e r n o s t ) l a l Q o $ i $ s n 2 n 3 s 3 g 5 e 4 ' i 1 t n . i . 6 1 n s 8 1 v t e e s r Q t $ e $ m 1 s 4 1 t 6 e ' . s 1 n 8 . 7 8 t 45 SVB 2014 4:3


 
early-stage over time charge-offs Net warrant gains have more thanoffset Q4 and FY 2018 Q4 andFY Millions - $ $ $ $ - 2 1 1 $ $ 1 0 0 0 5 5 5 $ 0 0 0 0 0 0 0 $ Corporate andFinancial Results Overview ( 2 3 0 $ ) 0 ( 1 2 3 $ ) 2 8 0 $ 0 ( 3 1 ) $ 2 3 0 Aggregate warrantgainsnetofearly-stage losses 0 $ 4 0 $ 2 3 0 $ 0 ( C E N 5 2 a u $ e ) 2 r m 2 t l 0 2 y g u $ 0 - a l ( s February 1, 2019 a 6 i 7 t n t a $ ) i s 2 g 2 v 0 o e e 3 $ n 0 ( n n 1 7 e e e 0 $ q t t (2002 -2018) ) 2 1 u c g 0 1 $ h i a t 0 ( a i y 1 n 8 r 6 g w s ) e 2 ( a 0 - w $ r o r 0 ( a f a 5 9 f r n s 8 r t a $ ) 2 n 7 a 0 $ t s 1 s ( s 2 0 e l 3 e t $ s ) s 3 2 s 0 7 $ e 1 ( a 1 1 r $ ) l 1 y 2 9 0 - $ s 1 ( t 2 2 a 1 $ g ) 4 e 2 0 $ 6 N ( 1 C 2 3 O 6 $ s ) 2 7 ) 0 $ 1 1 ( 3 4 0 $ ) 2 7 0 1 $ 1 ( 1 5 2 $ ) 2 3 0 8 $ 1 ( 4 6 5 $ ) 5 2 0 5 $ 1 ( 3 7 5 $ $174M ) 8 2 0 9 $ 1 ( 2 8 8 ) 46 SVB 2014 4:3


 
Q4'18 Q4 and FY 2018 Q4 andFY Millions $ Growth drivers: Growth $ 1 $ 1 0 5 5 $ • • 0 0 0 0 Larger foreign exchange spreadsfrommarket volatility price Higher client investment fees fromhigherfundbalances andrateincreases T L F Corporate andFinancial Results Overview Q $ o e o 7 n r t 1 a e 6 : Corefee income grew d ' 1 l i . i g 6 5 n c n o g r e r e x e Q $ f c l e a h 7 2 e t a 4 ' e 1 n i . d n 6 5 g c f e e o f e m e s $ Q e e 8 s 3 * 0 ' 1 . 6 5 February 1, 2019 $ Q 8 4 4 ' 1 . 6 6 C C $ Q l r 8 1 i e e 2 ' d 1 n . i 6 7 t t i c n a v r e Q d $ s 8 2 f t e 7 ' m 1 e . 3 7 e s n t f $ e Q 1 e 3 0 s ' 2 1 . 7 7 $ Q 10.9% 1 4 0 ' 6 1 . 7 4 $ Q L D 1 1 e 1 e ' t 5 p 1 t . 8 o e 0 r s s i t o s $ f Q e 1 c 2 r 2 r v ' e 3 1 i d c . 8 1 e i t / c S h $ t a Q a 1 $ $ $ r $ $ 3 $ n g 3 2 2 3 3 1 ' 8 d e 1 1 0 4 6 1 3 b . s 8 7 y L O $ Q C 1 $ $ $ $ $ $ 4 4 2 4 1 3 2 1 ' 6 0 0 1 8 5 1 2 . 8 0 47 SVB 2014 4:3


 
A history ofstrong core fee income growth volumes acrosscore fee bankingproducts: Recent core by feestrongtransaction incomehasbeendriven growth Q4 and FY 2018 Q4 andFY Millions • • $ $ $ $ $ $ 4 6 5 2 3 1 0 0 0 0 0 0 $ competitive spreads Foreign exchange andcreditcardvolumepartiallyby growth, offset lower Client investment fee fromhigherfundbalances growth andrateincreases 0 0 0 0 0 0 0 L F o e n r Corporate andFinancial Results Overview e d i i g n n g e r x e 2 $ c l 0 a 2 h t 1 a 1 e 0 n 4 d g f e e f e e s e s February 1, 2019 2 $ 2 0 6 1 5 5 C C l r i e e d n i t t i c n a v r e d s f t e m e e s 2 $ n 0 3 t 1 1 f 6 6 e e s 2 $ $ $ $ $ $ $ 0 3 1 5 4 5 2 7 L D 1 7 1 9 e 6 9 7 3 e 6 9 7 t p t o e r s s i t o s f e c r r v e i d c e i t / c S h t a a r 2 $ $ $ n $ $ $ g $ 0 1 5 1 9 d 4 7 3 e 3 3 1 1 b 6 s 5 4 2 0 9 6 8 y L O C 48 SVB 2014 4:3


 
Performance and growth driving non-interest expense Revenue and growth investment initiatives: • Client experience • People (staffing, enablement, performance-based incentive compensation) • Infrastructure improvements (banking, risk & compliance) Compensation and Benefits Expense Other Noninterest Expenses 2,685 $461 2,396 $404 2,225 $121 2,004 $727 $346 1,815 $195 $307 $120 s $606 $291 $48 s n $105 n o i $514 o l $184 i $55 l $42 $474 l $97 i $77 l i M $409 $150 $40 $48 $207 M $ $138 $40 $78 $121 $40 $40 $145 $30 $72 $122 $120 $325 $35 $101 $277 $50 $66 $244 $52 $214 $159 $187 $122 $94 $83 $95 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Salaries/wages and other Incentive comp. plans employee comp. Professional svcs. Premises & equip. Other employee Avg. full-time equivalent Net occupancy Business dev. incentives/benefits employees