| Bankers see potential in women-owned businesses
Stephanie Zhang had an epiphany. "I was working in the cell phone store one day when I said to myself, 'I could own this place,'" said Zhang, who now owns not one but two wireless stores as president of Best Wireless in San Francisco. Like many entrepreneurs before her, she turned to family to help make her dream a reality. In this case, she accepted $20,000 from her father. She then turned to Wells Fargo Bank for small business banking services such as a company checking account. Zhang represents an important market segment that institutions such as Wells Fargo and Wachovia Bank are heavily courting with a range of such services. .
Subprime troubles have yet to affect small business loans
Bad bets on subprime mortgages may be wreaking havoc on Wall Street, but there is little evidence that small businesses are having a hard time getting loans as a result. Lending data "and our conversations with bankers suggest that, at least to date, the supply of credit to small businesses remains healthy," said Frederic Mishkin, a Federal Reserve Board governor. Credit standards have tightened for all types of business loans, Mishkin told the House Small Business Committee Nov. 7. But small businesses aren't feeling the pinch as much as large businesses because few small business loans are securitized, he said. Also, small banks that specialize in "relationship lending" to small businesses have been "relatively unaffected by disruptions to the securitization markets," Mishkin said.
Banks missing opportunities to better serve small business - CFIB
Despite saying it wants to increase service to small- and mid-size business, Canada's banking sector is making little progress, the latest research from CFIB shows. Banking Matters reveals dwindling satisfaction with major financial institutions, with only two improving their rating since the previous survey in 2003. "Since the late 1980s fewer and fewer small business owners have applied for bank financing," CFIB President Catherine Swift explains. Small business loan activity has remained fairly stable since 1988 while loan activity for larger businesses has increased significantly. "This trend shows the banks may be missing opportunities for growth with the small business sector that accounts for 45 per cent of the Canadian economy," Swift says. "You have to question whether banks are meeting the borrowing needs of small businesses." CFIB asked members to rank their financial institution on nine performance indicators, including lending terms, service charges, access to full-service branch, online banking and treatment by their account manager.
Maybank banks on new online service
KUALA LUMPUR: Malayan Banking Bhd (Maybank) expects its trade finance sector to contribute 20% to the group's revenue in financial year ending June 30, 2009 (FY09), following the introduction of its new online trade finance service. The e-trade finance service, expected to be rolled out in April next year, is anticipated to contribute 20% to the group's revenue in its first year of implementation, and 25% for subsequent years, said senior executive vice-president, head of business banking Rozidin Masari after the signing ceremony for online trade finance services between Maybank and HCL (Malaysia) Sdn Bhd on Wednesday. Rozidin said the trade finance sector contributed 16%-17% to the group's revenue for the last financial year. At present, Maybank has more than 17,000 customers utilising its trade finance facilities, with about 3,000 business customers registered with Maybank2e.net, an integrated online enterprise cash management financial portal. "We aim to convert 10% of our Maybank2e.net customers in the first year of rollout to use this service and to grow it by 30% each year," said Rozidin. The online trade finance services via Maybank2e.net would "enable customers to utilise and monitor their trade financing activities and status online anywhere, anytime" said chief operating officer Datuk Johar Che Mat. The new e-trade service, targeted at small-medium enterprises (SMEs) is expected to further enhance Maybank's present SME market, said Rozidin. "We anticipate double-digit growth in SMEs and the commercial market for the financial year ending June 30, 2008 (FY08)," he added, in spite of only 1.1% growth in SME loans in its first quarter results ended Sept 30, 2007.
Local lenders' business loans going bad
Bad loan writeoffs are surging at Chicago banks, a sign that housing market troubles are spreading to small and mid-sized businesses. The area's second- and third-largest banks LaSalle Bank N.A. (now owned by Bank of America Corp.) and Harris N.A. wrote off business loans through Sept. 30 at more than twice the rate of last year, according to financial statements. As a group, the 15 largest local banks that disclose Chicago-specific data wrote off $84.3 million in business loans, about double the figure for the first three quarters of 2006. Although loans to commercial real estate developers took a turn for the worse early this year, lending to other businesses has been seen as safe. The writeoffs haven't reached levels that dent banks' earnings, but many bankers expect credit quality to further deteriorate this year and well into 2008 as the economy continues to soften.
EDC receives $109,000 grant for small business loans
Being a small business in Morgan County just got a little easier - if you need a little money that is. On Tuesday the United States Dept. of Agriculture Rural Development awarded the Morgan County Economic Development Corp. a $109,000 grant to assist small businesses. The grant comes at a good time as small businesses in the county have had few alternative options to traditional bank financing, Robert White, USDA rural development state director said in a press release. The USDA Rural Business Enterprise grant will be used to establish a revolving loan fund to provide incentives for business expansion, job creation and private investment in the county's rural areas. Dean Edwards, director of business programs and cooperative services, and Mark Beckman, business program specialist at the USDA, presented the check Tuesday to John Taylor, executive director, and Jeff Pipkin, deputy director, of the EDC at Martinsville City Hall.
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