Business/Economy: WGCU

Navigating banking changes in the business marketplace: Moore About Business

By Karen Moore for WGCU

January 21, 2024

Things have really changed in the world of commercial lending in the past few years. I recently caught up with Brandon Box, Southwest Florida Region President for Cogent Bank, to hear how they’re handling with those changes.

Moore: You know it was, it’s been a crazy year in the in the banking sector … tell me a little bit more about that in terms of why, why was it crazy in the bank sector?

Box: I think 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, and 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 that’s the value that they get from being with a smaller bank.

Moore: I think that’s one thing that doesn’t get the smaller community banks 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 do that…And that’s what happened.

Box: So, you have to be fair, but some banks are less flexible than others in terms of how quickly they can pivot. And that’s where the difference is, really.

Moore: Is there anything else you would like to say?

Box: From your audience perspective, I think 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.

Moore: So, as we continue to navigate the constantly-changing waters of business financing in today’s world, it sounds like it’s important to keep your banking professional on your navigation crew.

Karen Moore is publisher of Southwest Florida Business Today and special to WGCU.