Heritage Commerce is the holding company for Heritage Bank of Commerce (HBC), a community bank headquartered in San Jose, California, that focuses on relationship banking with small and medium-sized businesses in the San Francisco Bay Area and Silicon Valley. HBC operates 16 full-service branches across seven Bay Area counties, offering commercial and industrial loans, commercial real estate loans, construction, SBA, and consumer products on the lending side, while targeting non-interest bearing demand deposits and relationship-oriented accounts on the deposit side. HBC earns money on the spread between deposit funding costs and lending rates, and actively cultivates low-cost deposits by requiring borrowers to maintain deposit balances with the bank. Beyond traditional banking, HBC operates Bay View Funding, a subsidiary that provides accounts receivable factoring to small businesses nationally, purchasing unpaid invoices at a discount to provide working capital. HBC holds SBA preferred lender status, which allows it to approve SBA loans faster than many competitors. HBC competes primarily on personalized service, local relationships, and local knowledge rather than product differentiation. Heritage Commerce has announced a proposed merger with CVB Financial, the parent of Citizens Business Bank, a larger California-based business bank, which would represent a significant increase in scale.