Bank of America hiring small biz bankers

By Catherine Clifford, staff reporter


NEW YORK (CNNMoney.com) -- Bank of America will hire 1,000 new small business bankers by early 2012, the company announced Thursday.

The Charlotte-based financial giant says that this is just one step toward a commitment to increasing its support for small businesses.

The first wave of additional bankers will be added in Dallas, Los Angeles, Baltimore and Washington, D.C. They will focus on companies with less than $3 million in annual revenue and will work closely with local business owners, spending time at their place of business and learning about the companies, according to CEO Brian Moynihan.

"Our small business bankers will live and work in the communities they serve, making them uniquely qualified to work with these businesses and provide the best combination of financial services to help them grow," Moynihan said during keynote remarks at a Chief Executive Club of Boston luncheon.

The new legion of bankers will advise Main Street businesses on issues ranging from cash management to payroll to retirement funding. "Credit will be part of the solution set that we have for our small business owners," said Kerrie Campbell, who leads Bank of America's small business lending unit. "It is very relationship focused."

That's new territory for a national bank: It's the smaller community banks that usually stand out for their relationship building. As a result, most small business banking happens with community banks.

The nation's largest banks have a lot of ground to make up: Credit lines and loans to small companies were slashed during the Great Recession. Federal Reserve chairman Ben Bernanke recently estimated that $40 billion worth of loans to small businesses disappeared.

Bank of America played its part in the decline. Like many banks, it makes loans through the Small Business Administration's government-banked lending programs. Those loans represent a very small portion of overall small business lending, but they are an easily tracked indicator of a bank's lending activity -- and Bank of America (BAC, Fortune 500) has pulled back sharply.

In 2008, Bank of America made 3,296 loans totaling $102.3 million through the SBA's flagship 7(a) loan program. Many went bad: Ken Lewis, then the company's CEO, infamously called the bank's small business loan portfolio a "damn disaster." In 2009, at the height of the credit crisis, the financial giant made just 308 SBA loans, totaling $17.6 million.

Its lending barely picked up in 2010. In the SBA fiscal year that ended Sept. 30, Bank of America made 185 7(a) loans, totaling $22.8 million.

Bank of America said that its steep drop-off stemmed from a shortage in both demand and in qualified borrowers.

"Among those seeking loans, the creditworthiness of many businesses has changed," bank spokesman Jefferson George said. "Cash flow -- the most important factor -- often is down. The value of collateral, such as real estate or equipment, has decreased." To top of page

Just the hot list include
Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Questions & Answers



QHow does a florist sell more in this economy? We changed our business to designing weddings and events only, as the everyday flowers are not selling. We had to throw out too much product at the end of the week -- flowers are perishable! More
Get Answer
- The Flower Lady, Suwanee, Ga.
Overnight Avg Rate Latest Change Last Week
30 yr fixed3.80%3.88%
15 yr fixed3.20%3.23%
5/1 ARM3.84%3.88%
30 yr refi3.82%3.93%
15 yr refi3.20%3.23%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Sponsors

Sections

Bankrupt toy retailer tells bankruptcy court it is looking at possibly reviving the Toys 'R' Us and Babies 'R' Us brands. More

Land O'Lakes CEO Beth Ford charts her career path, from her first job to becoming the first openly gay CEO at a Fortune 500 company in an interview with CNN's Boss Files. More

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.