The relationship between the business owner and banker is among the important strategic relationships necessary for the long term success of a growing entity (almost as important as the CPA relationship). However, consolidation of the banking industry and the resulting movement of personnel between financial institutions have added challenges to the business owner.
In a recent Wall Street Journal article, “Banks Get Back to the People Business,” Ruth Simon examines how bankers may be looking at doing business “the old fashion way” – where character matters. Since the crash of the loan market, the focus has shifted back to building long-term, local relationships with clients. This is a welcome change from the recent past where loans were seemingly tied to how profitable they were for the bank. Local banks may have an implementation advantage here, but the trend has bigger banks reexamining the importance of relationships with the small business owner.