Five things to consider in your business banking relationship

June 20, 2018

This paid piece is sponsored by MetaBank.

Your business banker is a critical member of your business team. Making sure you have the right fit is crucial to the success of your business.

It can be hard sometimes to find the right banker for you and your business. But, as the business banking team at MetaBank shared, there are things to consider in evaluating the relationship to ensure you make a confident, informed decision.

Your banker should be able to guide you through a changing rate environment.

With the Federal Reserve interest rate increase this month, mortgage, Treasury and consumer interest rates are expected to increase as well. The change will increase the cost of doing business and buying a home. Additional rate increases are possible later this year as well.

“You will want to talk to your banker about how the increase and potential future rate increases will affect your business or home purchase plans,” said Meta business banker Josh Anderson. “It will become more expensive to borrow, so it’s good to begin having these conversations now.”

The changing rate environment will affect many industries:

  • Real estate – Expect new multifamily construction to slow or rental rates to increase to offset the increased cost of borrowing.
  • Retail – Increased operating line cost and overhead likely will result in increased end consumer costs.
  • Investment – Investors will become more selective with financing terms and look for ways to offset the potential borrowing cost increase.

Your banker should add value based on broad knowledge and experience.

“When you look at experience, it’s not just the number of years your banker has been in their career, it’s also the different types of business your banker has worked with,” said Adam Walsh, Meta business banker. “Look for a range of industry experience within the banking team.”

You want a banker that knows how and when to ask the right questions about cash flow patterns and capital needs. Have open-ended conversations about your financials and project details. Your banker is there to help you achieve your short- and long-term goals.

Discuss the range of banking products and services available to you. Your banker should act as the team lead, connecting you to experts in other departments of the bank and in the community.

You should be comfortable bringing your banker into decisions.

“Every situation is unique to the business owner,” said Meta business banker Keith Portner. “But there are a few key situations when you’ll benefit from bringing your banker in early to your decision-making discussions.”

Your banker can help you negotiate the best available deal, knowing what the structure of the loan is going to be. This can put you a step ahead if you’re looking at a purchase agreement.

Helping you look for details and asking the right questions during the price-negotiation process are just a few of the ways your banker can add value.

“Your banker can offer up a different point of view you may not have considered,” Portner said. “They may have an advantage working with many kinds of diverse businesses and industries, and will have access to specific industry profiles and information on trends, forecasts and recent developments in the industry. They should know the right questions to ask.”

Your bank should offer a team of business lenders to help support you.

“Within your bank, look for the team member who matches your needs,” said Meta business banker Tim Rustand. “You want overall strength in your business banking team. Each team member brings their own expertise, but as a group that experience is invaluable.”

Look for a team that is cross-trained with each other’s customers. No one will know you and your business the way your primary banker does, but in his or her absence you want to know your business can continue as usual.

Look for a bank that matches your business culture and values. Does your bank invest in your community? Is that important to you as a customer?

Ask honest questions. You want to ensure your bank and team are interested in your goals and aligned to help you meet them.

Your potential banker should allow you to ease into a relationship.

Sometimes despite all of your due diligence, you come to the conclusion that your current banking relationship just isn’t working out. But then you think about all the work required to move your business and decide you can put up with it after all.

“Try testing the waters a little first and start with one account or loan relationship,” said Meta business banker Karen Waller. “See how your banker and bank handle this new relationship. Are they attentive? Is their service beyond your expectation? Do you leave saying ‘I love my bank’?”

As you find that your new banker and bank are the right fit, you can begin moving over more accounts.  This approach can alleviate the stress and indecisiveness of moving all of your accounts at once. Over time, you may find it easier to keep all of your financial services with one bank and banker.

To learn more, contact the business banking team at Meta at 605-782-1818.

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Five things to consider in your business banking relationship

Your business banker is a critical member of your business team and must be the right fit. Here are five things to evaluate in your relationship.

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