Banker, lender — what’s the difference? Your banker lends you
money: true. And a lender is a banker: also a fact. But business owners who partner with an individual only
interested in approving (or disapproving) loans or pushing paperwork
through the financial institution’s web
of red tape are missing out on a key
adviser.
“Many people can lend you money, but
most clients forget that a good banker
can be a strong financial ally,” says
Dewey VanHoose III, executive vice
president and chief lending officer for
Sky Bank in Akron/Canton.
Does your banker work for you, keeping in mind yours and the bank’s best
interests? Or are your conversations
abbreviated and communications limited? “All bankers are not interchangeable,” VanHoose says.
Here, VanHoose provides insight on
how to find and establish a lasting relationship with a banker who is a stake-holder in your business and interested in
your success.
What is the real difference between a
banker and a lender?
A banker is a lender, and a lender is a
banker. But the difference is that a
lender, per se, is a loan officer who waits
for clients to call when they need something. Lenders tend to be reactionary.
They are order-takers who listen to
requests, process them through the
bank’s systems, report loan approvals or
declines to clients, and let the relationship go at that.
On the other hand, a banker is proactive throughout the year. Bankers know
their clients’ companies well enough to
understand their borrowing histories,
whether long-term debt, revolving lines
of credit, small business loans or real
estate transactions. Because bankers
understand their clients’ goals, they can
plan for future lending needs. They can
plant a seed in the organization and alert
members of the bank’s loan committees
that ABC Company will be expanding down the road and eventually need extensions of additional credit.
What questions can business owners ask to
learn whether a banker has their best interests in mind?
Ask them what type of companies they
serve in their client base. If you are in
the mold business, does your banker
work with other clients in the plastics or
steel industries? Does your banker know
that the price of resin can fluctuate?
What does he or she know about the
type of business you are in? Does your
banker know it is seasonal or cyclical?
In turn, your banker should offer you
insight on his or her background. For
instance, I tell clients that I’m a CPA. I’ve
sat on the other side of the desk; I’ve had
to deal with bankers. You may not learn
a lot about the size of your banker’s
client portfolio because we are a very
confidential industry. But you can certainly find out years in service. Ask
about their experience.
Any warning signs that your banker is more
interested in lending than partnering?
One sign is if a banker is noncommittal and doesn’t speak his opinion or
know enough about the bank to talk
about it and answer questions. Does the
banker seem genuinely interested in
learning about you and your company?
Also, is the banker asking you the right
questions?
What are the right questions?
Questions that pertain specifically to
your industry and are not general business questions. For example, if you are
in the nursing home industry, an intuitive
banker might ask how new regulations
will affect your business. This shows
that the banker took time to see how
regulations and current events are
impacting your business. Knowing this
will help your banker prepare for the
future, whether explaining to loan committee members why numbers might be
lower than usual or helping you make
decisions to position your company to
rebound. A good banker will help you in
good and bad times.
How should business owners communicate
with their bankers so they can build this
give-and-take relationship?
Your relationship with a banker is like
a marriage. There are ups and downs.
There has to be a loyalty factor, and
that’s a two-way street. Don’t wait for
your banker to call you to schedule a
meeting or arrange a lunch. If an event
occurs that is significant to your business — say you lose a big client — your
banker should know about it.
As a business owner, you don’t want
any surprises. Neither does your banker.
If both parties practice open communication, your banker can go on the offensive in down times and establish the best
plan for the future.
DEWEY VANHOOSE III is executive vice president and chief
lending officer for Sky Bank. Reach him at (330) 628-8710 or
[email protected]. For more information, visit the
Web site www.skyfi.com.
