- The Washington Times - Monday, July 2, 2001

Friedman, Billings, Ramsey Group Inc., the Arlington-based investment bank that has left a lasting mark on the Washington-area technology industry, is beefing up its operations in Europe to fill a gap created by the disappearance of many mid-sized brokerages over the last several years.

In the past three months, FBR's wholly owned London-based subsidiary has hired 16 brokers, research analysts and investment bankers, more than doubling the size of that office.

FBR has also hired James Macmillan-Scott, formerly the chief executive officer of the European operations of Hambrecht & Quist, a San Francisco investment bank that New York-based Chase Manhattan acquired last year.

"The European investment banking and brokerage environment in our focus sectors is still surprisingly fragmented, with many banks executing only a handful of transactions per year," Mr. Macmillan-Scott says.

He cites research showing that the average mid-sized investment bank in Europe has managed only one or two initial public offerings each year since 1995.

In the United States, FBR has cultivated its investment banking business largely around the technology and energy sectors. These two areas, along with real estate and financial services, will form the core of its efforts in Europe, according to spokesman Michael Robinson.

FBR's technology practice in Europe will include biotechnology, an area in which the firm has been strengthening its presence. Last year, it established a venture capital fund in partnership with Bethesda-based Emerging Technology Partners.

The firm hopes the London office will finance itself by first focusing on selling its services to institutional investors. Hopefully, Mr. Robinson says, success in this area will finance its research and investment banking units.

FBR has taken a hit during this year's slowdown, reporting losses in the first quarter of this year. Revenues from its venture capital business, heavily focused on the ailing technology sector, plunged 66 percent, resulting in an overall $6.1 million loss.

But the firm is plowing ahead, convinced that the downturn will be brief.

"We still think this is the time to expand and get talented people," Mr. Robinson says.

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