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HOW TO CHOSE A BUSINESS BANK

  1. Look for a bank or a banker that understands your business. A bank should talk your language; understand your business and what you’re doing. If a bank offers a specialty area such as entertainment division handling entertainment-oriented clients, it’s likely that if you are in the entertainment business, that bank will understand your mechanics and financing. The same holds true for other industries.
  2. Make sure you are introduced to the right people. Get as close as you can to the decision makers, and feel confident that you want this person to be your sponsor within the bank. This relationship and its strength are often the key to a satisfactory corporate relationship. Deal only with senior management at independent banks, the higher the better, and deal only with president or senior loan officer at a branch bank versus the branch manager.
  3. Evaluate the bank’s stability and ask for references. Corporations today are unnerved about bank failure rates in America. A high percentage of banks are on the FDIC watch list facing possible insolvency. Find out if the bank is well capitalized, this is their cushion against losses. A valuable source for this type of information is www.fdic.gov.
  4. Compare fees and interest rates. Match up the size of your credit needs with the size of the bank’s capital base. Watch out for excessive fees for such things as covering checks, ATM’s, wire fees, minimum balance fees, etc.
  5. Be as complete and accurate as possible with the information you provide the bank. You’ll know after the first or second meeting with the new banker if they’re asking incisive and pertinent questions. It is a good idea to make the banker as knowledgeable about your company as possible, by doing your own write-up and analysis to better inform the bank of all salient features of your business. In securing loans, you may be competing with many other companies, so make the information you provide the bank as complete and accurate as possible.
  6. Make sure you feel an element of trust and confidence in the bank. Go with a bank you feel will back you up. It’s a misconception that all banks are the same. There is a wide degree of difference from a service perspective as to how important you are to them and how they’ll treat you as a client. Although government guaranteed FDIC insurance has been responsible for placing a higher degree of trust today, be sure they have a reputation for error free service.
  7. Checklist of other considerations.
    • Are the branch locations convenient?
    • Are banking hours convenient?
    • Check out their online services.
    • How quickly can they provide loan approval?
    • Is the bank visible enough in your particular industry so that you know their reputation?