The Advantages of Community Bank Financing

Mar 14, 2017

IBA, as the premier business brokerage firm in the Pacific Northwest, is firmly established as a respected professional service firm in the legal, accounting, banking, mergers & acquisitions, real estate, and financial planning communities.  Periodically, we will post guest blogs from professionals with knowledge to share for the good of owners of privately held companies & family owned businesses. The following blog article has been provided by Cathy Griffith of SaviBank (

The Advantages of Community Bank Financing


The buyer has several financing options when purchasing a business. These include:

*using personal savings;

*seller carry-back financing;

*bank financing; or

*a combination of two or all three of the above.

If the bank financing route is selected, then another range of options is presented, some of which are:

*large national bank;

*regional bank; or

*community bank.


I have had the pleasure of working at each of the banks described above. While there are plusses and minuses to each, there are many advantages to banking small; and here are some of the more popular reasons:


  1. Familiarity with the community and customers. The community bank decision makers are entrenched in the community that they serve. Sure, the large banks will have their local employees involved in the community, but these are the front-line folks. Many times they have to plead their case with decision makers who aren’t even in the same state.


  1. Empowered employees. Chances are high that the lender you speak with at the local branch can give the Chief Credit Officer or the Bank President a call (or go across the hall for a personal visit) and get a verbal indication of whether or not the deal is a go. I can’t count the number of times I have sat in the President’s office and preflighted a potential deal with him. The best part is he has also coached me on how to make a deal work by using different structures and more flexible financing ideas. I am able to get back to the customer quickly with a go/no go. This really cuts down on the unpleasant experience of being told the deal looks good at the local office only to get declined later by a faceless underwriter.


  1. Credit culture. It has been my experience that, the larger the bank, the smaller the credit box. At a community bank, we try to do the deals that make sense, not just the A+ credits. We are able to balance the risks with the strengths using discretionary reasoning, not a credit score. We’re also able to gauge possible success within our community; not applying a one-size-fits-all product to make sure it will work in California as well as Maine.


  1. Engaged employees. At a community bank the lender stays with the relationship from birth until death. We become expert at nagging for annual financials and really looking at them to see if additional value can be added. The same person who approved the loan will be with you year in and year out as long as the loan is active. We are responsible for the quality of our individual portfolios, and we know how our customers are doing and what they may need.


I would strongly encourage any potential customer to see what a community bank has to offer. It is my hope that you will be as delighted as I was to discover the differences between national, regional and community banks.

Cathy Griffith is the Vice President & Manager of SBA Lending at SaviBank.  If you have questions about the content of this article or any area relevant to Ms. Griffith’s expertise please contact her at (360) 770-2960 or

IBA, the Pacific Northwest’s premier business brokerage firm since 1975, is available as an information resource to the media, business brokerage, and mergers & acquisitions community on subjects relevant to the purchase & sale of privately held companies and family owned businesses.  IBA is recognized as one of the best business brokerage firms in the nation based on its long track record of successfully negotiating “win-win” business sale transactions in environments of full disclosure employing “best practices”.