Are there any good bankers left?

As a former commercial lender, I'm appalled that bankers are forcing small businesses into bankrupcty rather than doing a workout. According to Business Week, business bankruptcies are up more than 40% over last year. (see article "As Bankruptcies Surge Fewer Emerge" )

Banks have "fragile" balance sheets right now. Here's why: They reduced their credit standards to follow the crowd. Now they are paying the price. Just like small business owners are paying the price through reduced sales, profits and access to credit.

I've personally noticed that the unwillingness to work out of problem situations is especially true of the large banks. The locally owned independent bankers are much more likely to work out payment arrangements with business owners. Probably because the decision-makers live in the community in which they serve. Its more difficult to be hard-hearted when your neighbor, club member or friend is requesting that you help him save his business.

I am working with some business owners in this regard. In my prior life as a commercial banker, every one of the banks I worked for referred to themselves as a "relationship bank". Well, it is apparent that the "relationship" only works one way. That's NOT a relationship that anyone can be in successfully for the long-term.

Come on bankers, small business owners need you now more than ever. Don't follow the crowd like you've always done. We need bankers with the mental toughness and guts to take a stand and do what's right for business owners.

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