Community Banks and Small Business – a marriage made in heaven?

 Customer Service, Lending, Marketing, Strategy  No Responses »
Aug 092012
 
Community Banks and Small Business - a marriage made in heaven?

Community Banks and Small Business.  A marriage made in heaven… or so many Community Bankers would have you believe.  This may have been the case in the past, but does it still hold true in today’s environment? A recent BAI Banking Strategies article - Small Business Still the Charm - attempted to make the case that, Small Business is just waiting for Community Banks to come calling.  The article is an interview with Richard Dailey, CEO of the 3-branch, $215 million-asset Apollo Bank in Miami, who asserts that Community Banks focused on small business customers can still do well. While we don’t doubt that Mr. Daily, Apollo Bank and a handful of others may find success, Small Business banking is not as simple as some may believe; and may require significant planning before most of the 6,500 Community Banks deploy additional resources to pursue this segment.  We suggest that there are at least [Read More...]

Banks skirting lending rules … again!

 Competition, Customer Acquisition, Lending, Regulations  No Responses »
Jan 142011
 

It appears that some National and Community banks may have been mis-behaving. NY Times reports that Banks lending under the rural loan program – called Section 502, administered by the US Department of Agriculture, “was plagued by lax government oversight and many of the same sloppy banking practices that fed the broader mortgage debacle.” Section 502 loans focused on communities with populations under 20,000 that were outside metropolitan areas. These loans required no down payment for residential housing loans but carried very specific underwriting requirements. A recent report from Inspector General of the US Department of Agriculture uncovered  that many loans may have been done improperly and warned that a wave of defaults might be looming. The Agency guaranteed more than $10 billion in rural housing loans with a total administrative budget of over $130 million.  The Audit reviewed a small sample of the more than 81,000 guaranteed by the US Government and found that as many [Read More...]