Monday, December 15, 2008

Lunch with the Chairman

Surviving the financial crisis was the focus of a lunch presentation by Ivo Tjan, Chairman and CEO of CommerceWest Bank. Along with about 75 business owners and professionals, I attentively listened to Tjan explain the origins of the financial crisis, what was getting done in Washington to rescue the economy and what borrowers should know when asking for a business loan.

Here's a few of the points I found most interesting:

  • Shortly after inauguration, the new administration and congress will likely pursue a second stimulus package ranging from $700 billion to $900 billion. It will be heavy on infrastructure spending, not tax rebates.
  • Economic recovery is not likely to occur before fourth quarter 2009.
  • Ben Bernanke is not afraid of taking the fed funds rate to zero.
  • Only three of every ten banks currently have the capacity to make new loans.
  • Banks are focusing more and more on a business' ability to generate cash flow to repay a loan than on collateral.
  • Banks will understand if a borrower's current performance is suffering provided that it is performing better than its peer group and management has identified its challenges and is implementing a plan to address those challenges.
  • To ensure access to business loans, borrowers need to have strong relationships with the decision makers at their respective banks.
Not a bad deal - a lunch which included food to eat and food for thought!

Need help finding the right lender or telling your story the right way for your California business? Read "Matchmaking for Business Loans" and give me a call!

Tags : CommerceWest Bank , Ivo Tjan , business loans , credit crunch

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