You’ve probably received the phone
calls. Another banker wants to earn
your business and is luring you with better rates, a hot new product or service
— incentives that may inspire you to reevaluate your current banking relationship.
Or, perhaps you realize that your banker is
not fulfilling the role of a trusted adviser,
which is what you should expect.
“The banker should understand what
keeps a borrower up at night,” says Lou
Poppovich, vice president of commercial
banking for Sky Bank in Akron and
Canton. “He or she should be proactive in
bringing value-added solutions to the
table.”
In fact, your banker is an integral part of
the “big three,” Poppovich says. (The other
two are your accountant and attorney.)
Smart Business asked Poppovich to discuss what qualities to seek in a banker and
how to push an existing banking relationship to the next level.
What are the basics of any banking relationship?
No. 1, the banker must understand your
business. He or she should meet on your
turf, and you should discuss your financials
at least quarterly. When bankers see the
inner workings of a business and meet the
management team, they can better understand what issues you may confront. Of
course, understanding a business requires
more than this. You must be willing to open
up to your banker, and he or she should be
perceptive to your needs. Don’t just call
your banker when you have a problem.
Share the good news, too — a new customer, a significant sale, a hire that will
strengthen your management team, etc.
Secondly, your banker needs to be
responsive and provide exceptional service. This is an important issue that really
goes a long way to building relationships.
Returning phone calls, taking the time to
listen and handling matters in a timely matter are very important basics of any relationship.
How does a business owner push a banking
relationship to the next level?
A proactive banker will bring new ideas
and solutions to the table to help companies meet their corporate banking needs. If
a banker is attuned to new products and
services the institution offers and has your
best interests at heart, he or she will suggest ways you can upgrade or add new
services that will make your life easier so
that you can focus on running your business. Bankers can arrange meetings with
product specialists who are up-to-date on
services and technologies in every sector:
cash management products, international
services, technology for treasury management, capital market products, remote
deposit capabilities, etc.
How many professionals at a bank should a
business owner deal with?
One of the biggest complaints I’ve read
about in surveys about bank service, in
general, is loan officer turnover. Business
owners are frustrated when they build a
relationship with a banker, and then he or
she transfers to another branch or joins
another financial institution. You should
align yourself with a bank that has a track
record for long-term employee retention.
Ask your banker how long he or she has worked with the institution. Regardless,
your banker should introduce you to other
professionals you will deal with at the
bank, including the credit officer, senior
lender, portfolio manager and branch manager. Insist that you get to know these key
people so you have ‘backup.’
What if a business owner wants to begin
building a relationship with a new banker?
First, rely on word-of-mouth referrals to
find an institution and a banker. Ask your
CPA or attorney for suggestions. Ask
industry peers for names of bankers who
have a good reputation and are willing to
go to bat for their customers. Interview
two or three prospective bankers with
tough questions about how they develop
and build relationships. Remember, you
are going to be sharing information about
your business that you wouldn’t just tell
anyone on the street. The good, the bad —
your banker needs to know it all, and you
should value this person’s opinion as a professional and a sounding board.
Once you meet with a few bankers, discuss the options with your CPA. He or she
can offer direction on more technical
aspects of the relationship, such as
whether the commercial banking package
being offered is competitive. You’ll find
that bankers will try to earn your business,
and they may negotiate terms.
What’s more important: rates or relationships?
You should not base your decision strictly on pricing or which institution will offer
you the lowest rate. What about service?
What about solutions and all the qualities
we mentioned earlier? You wouldn’t
choose a CPA who charged the lowest rate
but didn’t have the knowledge and capabilities to handle your taxes and financial
statements. The same applies to selecting a
banker. You get what you pay for.
LOU POPPOVICH is vice president, commercial banking for Sky
Bank in Akron and Canton. Reach him at Lou.Poppovich
@skyfi.com or (330) 628-8703. For more information, visit
www.skifi.com.