Bank Best Practices

We recently asked several top performing community banks their “secrets” to being high volume producers of SBA 7(a) loans. Here is what they told us:

  • Show staff the positive results of making an SBA loan to the bank and them
    • Increased product offering
    • Retains and attracts customers
    • Increased liquidity after selling guaranteed portion
    • Increased bottom line through premium and servicing fee income
    • Decreased exposure with SBA guarantee
    • Reduced reserve requirements
    • Incentive pay for bankers based on production
  • Ongoing education of staff regarding SBA programs-conducted by Small Business Resource Associates
  • Discuss in staff meetings to promote programs and keep them “top of mind”
  • Show lenders that they must sell on availability and structure and not pricing-benefits of longer term, lower cash injection, advance not based on collateral value, cash for working capital, etc.
  • Challenge each lender to a production goal that includes a minimum number of new SBA 7(a) loans per year
  • Challenge lenders to identify and refinance a minimum number of existing portfolio loans to SBA 7(a) loans
  • Pay incentives to loan officers based on SBA production
  • Hire an experienced SBA lender in your market
  • Market the bank’s SBA capabilities
    • Host meetings with potential referral sources to promote the program, i.e., CPA’s, attorneys, RE brokers, mortgage brokers, business and loan brokers
    • Be willing to pay referral fees
    • Contact existing referral sources and explain the program
    • Be sure that all employees are aware of the program so that they can be a referral source for  lenders
  • Send weekly “email blasts” to lenders- Small Business Resource Associates will provide to your list of bankers

 

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