Southwest Florida Business Today
A Regional Bank President’s Perspective on the Southwest Florida Lending Market
Special to Karen P. Moore, Publisher
I recently spoke with Brandon Box, Southwest Florida Region President for Cogent Bank, and talked about banking in the local business marketplace.
Moore: It’s been a crazy year in the banking sector. Tell me about that from your perspective.
Box: Two things stand out for the banking sector specifically. One is the big March banking financial crisis where Silicon Valley and First Republic banks failed and really caused a bunch of chaos in our industry because everybody thought their bank was going to fail. There were flashbacks to 2008, 2009, when everybody woke up and wondered what bank was going to be taken over that day. What that did for our business was it kind of forced us to sit down and talk with clients. How do we calm their concerns? Because it wasn’t a systemic issue, but the perception was that it was systemic. So that’s how the year kicked off, and of course throughout the year we had the fastest pace of interest rate hikes, pretty much in history, in terms of the speed at which rates escalated. That created a different type of environment than most customers have ever experienced in their careers. So, there was a lot of just one-on-one coaching, talking and helping customers, and I think most of our clients would say that’s the value that they get from being with a smaller bank.
Moore: Yes, I was recently talking to a local community banker about how the Small Business Administration was so disappointing in terms of their lack of ability or willingness to support the small business community post-Hurricane Ian. I’m not just talking new businesses. I talked to well-established businesses that have been here a long time and they’re not happy with the SBA. This banker said, “If the SBA would leave it in the hands of the community banks like they did with PPP, it would have been much more effective in our community.” What are your thoughts?
Box: PPP was the first time that really a stimulus program flowed through the banks. And in hindsight, I think it went pretty well. The local banks know where the needs are the most, they know where the risks are the most and they have a better local pulse on what’s going on. So they can allocate those funds or have a platform already built in the way we make loans to facilitate that goes a lot easier, versus someone just submitting a paper application and hoping someone in the government simply approves it. My experience was that it seemed to go OK with local access to Hurricane Ian SBA business loans, but I will say, natural disasters are when a relationship with a bank does matter because it’s hardest to get money when you need it the most. That’s kind of a common theme in banking. If you don’t know anybody at the bank you’re working with, it’s especially hard because it’s still a business where things go through a channel and you have to have advocates in those channels to get things done. It’s a lot easier to navigate those things when you’re with a smaller bank.
Moore: That’s one thing where the smaller community banks don’t get enough credit because yes, it’s still all about relationships. However trite that phrase is, in so many ways life is still that way. It certainly is in Southwest Florida. I use certain banks for certain reasons, and for PPP, I went to a local bank because the banks I use weren’t able to help me and I knew the community banks could.
Box: You have to be fair, but some banks are less flexible than others in terms of how quickly they can pivot. That’s where the difference is, really, between the big banks and smaller community banks. It’s important to mention it’s a good time to go sit down with your banker, whoever they may be. The environment has really changed what people can earn on their deposits. The best way to structure their account has changed, the way they carry their balance sheet has changed, and it’s an important time to sit down and reevaluate to make sure you’re positioned the most efficiently for both short-term and long-term success for your business. Create that vision with guidance from your banker.
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