According to the most recent
SBA Quarterly Lending Bulletin, small business lending declined in the first quarter of 2011. At first glance, this seems like another, “banks aren’t lending” report, but further analysis shows that banks ARE lending, you just need to go to the right kind of bank.
According to the SBA, outstanding loans by the largest lenders declined by 4.9 percent. However, loans by mid-size lenders remained constant and loans by small lenders experienced a 3.1 percent increase.
This report illustrates something that we have known at Ridgestone Bank for a long time. Because community banks are smaller, they have a greater interest in supporting the businesses that provide jobs to people in their local area. Throughout this economic downturn, we have continued to make loans to businesses across the United States using government-guaranteed loan programs. In fact, Ridgestone is the number one SBA lender in Illinois. We think that the lending differences illustrated by the SBA report highlight the advantages of working with a community bank.
Community banks understand that it takes money to make money. Because they are smaller, community banks are able to work with potential borrowers to understand their businesses and develop solutions to their financial challenges. While a large bank has a single, standard process for loans, a community bank may be able to adjust the process to include relevant information in the borrower’s favor that may not be considered by a large bank. In addition, community banks can often process loans faster. We understand that business owners need answers. If the answer is no, a quick no will allow a business to move on to another potential funding source. If the answer is yes, the reduced wait time means that a business can be back on the road to financial stability sooner.
Just like many communities are encouraging residents to, “shop local,” we encourage you to bank local. Whether you choose Ridgestone Bank for your business loan or anther community bank, you can feel good knowing that you are investing in the community that is investing in your business.