It felt good to walk our business loan payment over to our bank this afternoon.

I’m old school where we deposited our paychecks and made loan payments in person — especially on Fridays.

Gave loan officers, and even the president of the bank, the opportunity to get up from behind their desks to shake the hands of customers and ask how they were doing. Gave me as a bank board member an opportunity, even if second hand, to have information about who our customers and loan applicants are, as people.

When was the last time you shook the hand of a bank president so you knew they would be there if you wanted a loan to start or expand a business? Or a loan for home improvements? Or to talk to if some issues arose? And for them to know they would have the loan applications they need because of the relationships they established.

Too many business people are out chasing angel or VC money when going to a small bank for a loan may be easier — and certainly cheaper. More business people (lawyers included) should be nurturing relationships with bankers — and bankers with entrepreneurs founding and running emerging growth companies.

When we were moving to Seattle almost twenty years ago, I needed a home loan in a hurry. The finance company we were referred to dropped the ball and couldn’t close when they said they would. Not really an option as the moving truck was arriving in five days.

I told the finance company if they couldn’t close as committed, I’d go to a local bank and get a loan — and I did. I had my friend who was the president of a bank in Wisconsin fax a letter to the president of American Marine Bank on Bainbridge Island to tell him of my predicament and that I’d be a great customer. The president and his loan officer got the loan closed just in time.

American Marine has been sold a couple times over. Columbia Bank, a large Northwest Bank owns it now. No more dogs coming in for milkbones. No one coming out to greet you. And enough of an uncaring in-personal approach to lending that we’re pulling our home loan from them, something they’ve held in-house since the date of the rush loan, and all our deposits and moving to another bank.

Banking, as much as any business, is all about relationships and people. Relatonships both ways — for you as a customer wanting a good bank that knows you and for the bank who wants good customers.

If you are in Seattle, First Sound Bank is an excellent small business bank, whom I/we have worked with for the last few years. Jon Shelton, who also rides the Bainbridge-Seattle ferry, is the President and CEO.

  • Incredibly timely, Kevin. My bank in Kansas City (parallel: American Marine) was wonderful when I started with them. As I started my firm, I called several institutions to ask about their IOLTA arrangements, and most of the people who answered the phone reacted with “huh? Um… let me ask somebody else.”

    When I reached one who said “no problem– do you need to be compliant with Missouri or Kansas or both? We can handle it.” I was sold– and a vocal advocate for (insert bank name here). It was a great relationship– if I needed anything, a phone call or email would take care of it.

    Then they were bought out by a bigger bank from out of state, and the mother ship moved a few hundred miles south. That relationship that was so important? Gone. The new mother ship (Columbia) wanted things done their way– not the way that drew me in.

    I’m shopping around again, and have narrowed it down to two local outfits, neither of which seems to be a takeover target. Locally owned and controlled, and I can phone a VP who will take my call if anything goes awry.

    But it’s traumatic.

    • There should be a list of state chartered banks on the web. Make a list of the smaller ones as measured by assets, loans, who are doing business in your area. Their cost of money is higher than that for larger banks and thus they are more aggressively looking for customers and loans.

    • I took banks $500 Million and under, looked up officers on LinkedIn and emailed the President asking to get together. If I had a good connection on LinkedIn with a LI connection the president, I pinged the common connection and asked how well they knew the president. If well, I asked for the introduction — good for relationships and referrals all around.