WASHINGTON — Davenport & Co. has hired two financial advisers for a new Charlotte office to bolster its services in the Southeast, the firm announced this week.
Senior vice president J. Walter Goldsmith and associate vice president Patrick Q. Smith both came from First Southwest & Co.’s Charlotte office.
The duo, which started on Tuesday as the first two employees in the new office, will be advising government and revenue bond issuers in the Carolinas.
Coleman Wortham 3d, Davenport’s president and chief executive officer, said in a statement that the new Charlotte office is part of the company’s effort to expand in North Carolina.
Richmond-based Davenport was the seventh-largest financial adviser in the Southeast last year by dollar volume, and the fifth-largest in North Carolina, according to Thomson Reuters data.
Dallas-based First Southwest was third in both the region and in the state.
North Carolina has become fertile ground for public finance business in the Southeast.
The state’s total 2009 bond issuance by dollar volume increased 32.7% in 2009.
Issuers in the state sold $10 billion of bonds last year, making the state the third-highest ranked for bond volume in the Southeast.
Davenport & Co. has three other offices in North Carolina and First Southwest has one, according to the companies’ Web sites.
Goldsmith started in public finance 11 years ago with J.C. Bradford & Co. in Nashville, Tenn.
In an interview, he said that he and Smith recently worked on triple-A South Carolina’s $300 million refunding deal in March. They also have advised North Carolina, Mecklenburg County, and the North Carolina University system, he said.
Goldsmith predicted that Build America Bond issuance will continue to be strong this year and said he expects to see more qualified school construction bond and refunding deals. Revenue weakness continues to affect state and local governments, he said.
On Monday, the North Carolina General Assembly’s fiscal research division revised downward by $391 million revenue estimates for fiscal 2010 and reduced 2011 revenue estimates by $702.9 million.
The larger shortfall includes a $85 million loss from anticipated estate tax revenues in 2010. North Carolina’s estate tax is tied to the federal estate tax, which expired on Jan. 1, 2010, meaning the state will not collect estate taxes this year.
A lot of government issuers “are wrestling with budget challenges” for fiscal 2011, Goldsmith said. They also are facing credit challenges associated with revenue shortfalls, he said.
“What has been keeping us very busy as a financial adviser is helping people assess that debt capacity and how they look at their long-range capital planning.”