Opening a Bank Account, Gaining a Friend

A good relationship with a lender can be a company’s chief asset

Growing up, I remember the relationships my parents (and my early employers) had with their bankers. They knew your name when you walked into the bank; they knew your name when you walked down the street. Your friendly hometown banker was just that, a friend.

The landscape has certainly changed, as have the names of many banks. But, I'm quite certain that many bankers still desire that the relationship part of the equation return.

As an owner of my own accounting business, I've recently found just that relationship. And, in doing so, I successfully negotiated both an equipment loan and line of credit for my small business in the depths of last year's "credit crunch."

I'm confident that my success had everything to do with relationship building – not just the numbers. Other banks denied the very same application my new bank approved. However, my new bankers took the time to get to know me in person, to get to know my business and to hear my vision for the future. They continue to check in with me regularly. Do your bankers do that?

I had another little secret: a solid loan proposal, one that told my business' story.

Here's a summary of what it included:

About Us: Who are you? What makes your company special?  Highlight your strengths, your accomplishments and how teaming with the right bank will make you (and them) successful.

About our Industry: Tell your banker about your industry. Find articles or benchmark data for your specific niche. Explain what makes that niche special. Or, better yet, show how your actual operating results are doing better than your industry. Peruse the internet for articles (think the Wall Street Journal, Forbes, etc.) about your industry. Benchmarked financial data can be found at Hoovers or The Risk Management Association.

About our Future: Do you have marketing plans? If so, what are they and how have they led to your success? Have expansion plans? What are they and how would financing improve your expected results?

Loan Request: What will the requested funds be used for? The placement of this is last for a reason. You want your banker to be excited about building a relationship with you.

Make sure you've provided clear and convincing information in the previous sections of your loan proposal about why a relationship with you is just the beginning of long-term success for both you and the bank.

Include your balance sheet, operating results and related articles in separate marked sections. Provide your banker with three or five year projections and include more than one scenario (e.g. what your operating results would look like with no growth, 5 percent growth or 10 percent growth).

And don't forget that appearances matter. Package your loan proposal professionally. Use color, use a table of contents and professionally bind your materials into a single, impactful document.

Lastly, do your homework. Ask colleagues and friends about their banking relationships, and then start making appointments with only those banks or credit unions that meet your personal criteria.

Remember, a banking relationship is more than a checking account or loan – it's also a relationship that is critical to your success. And, in this environment, a solid business like yours is critical to their success as well.

Couch is the founder of Acuity Group PLLC and has more than 13 years experience in the combined areas of accounting, fraud examination, litigation consulting and business analysis.