Magazine article Independent Banker

The Keys to Success in SBA Lending

Magazine article Independent Banker

The Keys to Success in SBA Lending

Article excerpt

What does it take to succeed as an SBA lender? Perhaps the most important factor is a willingness to become an expert in the Small Business Administration lending program. This requires getting familiar with everything related to the program. For example: "The most critical aspect for a bank wishing to become a successful SBA lender is the ability to differentiate between a potential SBA loan transaction and a conventional C&I loan," says G. Arne Monson, president of Holtmeyer & Monson, an SBA lending consulting firm for community banks. "Successful SBA lenders are able to identify the inherent characteristics that can be mitigated via the SBA guaranty. Many commercial lenders are not able to 'think outside the box' in identifying SBA transactions."

Building a knowledge base

One bank that has made a steadfast commitment to expertise is $3 billion-asset German American Bank headquartered in Jasper, Ind. "There are a few other banks making SBA loans, but we are the 'go-to' SBA lender in the Evansville, Ind., market, because we position ourselves as the experts," says Lindsay Botsch, regional vice president, commercial banking. "We do this by keeping up with all of the changing regulations and policy updates, attending SBA conferences and maintaining close contact with people at the SBA district office to answer questions and clarify new procedures for us." Every year, for example, the SBA changes many of its policies and procedures, and, according to Botsch, if banks don't keep up with all of this, it is very difficult for them to make SBA loans. …

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