Last year, a local HVAC company native to the Philadelphia area celebrated their 15th year in business.  Since opening, the company worked with the same banking institution, growing their lending relationship to $1.2 million. It built up a healthy depository balance within business and personal accounts.  Recently, the company was excited to learn that it had won a very large contract to replace a number of HVAC systems within a large school district.  Eager to accept the opportunity, the business owner attempted to contact their banker about increasing their line of credit.  The owner became frustrated when the phone call was not returned. As days passed, the owner’s frustration turned to anger.

The owner became aggravated and felt it was time to explore taking their banking and credit needs elsewhere.  This business is not alone; one-quarter of small businesses have changed banks in the last four years.  In addition, more than a quarter of bank customers said they stay with their bank because switching is a hassle, and about half said they haven’t seen competing offers that are attractive enough to make them move.  One compelling reason to make a move would be to gain access to a higher performing banker or products that can aid in security or improve efficiency.

Business owners also should consider switching banks if they question the relationship with their bank or banker.  Both can have a notable impact on the future success of the business.  Banks can offer many more services than most people think.


Did you know that your bank can:

  • Help retain valuable employees.
  • Make your business run more efficiently.
  • Take advantage of a wide range of new technologies to improve operational efficiency.
  • Serve as a trusted adviser and offer sound business advice.
  • Aid in business transition and offer products to aid in succession planning.
  • Make your money work harder for you by choosing the right accounts.
  • Help you grow and better manage your business.
  • Offer valuable insight about others in your industry as to how they are doing.
  • Offer products to better control your cash management practices.
  • Offer sound advice and guidance to help navigate your firm through turbulent financial periods.
  • Spot trends in your business, which may be overlooked.
  • Offer solutions to more effectively help with certain challenges faced by small to midsize businesses.


What to consider when making a change

Without question, credit sensitivity to interest rates and fees are important.  Equally important are intangibles such as interaction, service and product availability. Switching banks is a labored task. However, having the right partner can significantly influence your business. Keep in mind that a lot has changed in the regulatory climate of the banking industry, so don’t be surprised if your initial interactions are a little more labor intensive. 

Whom should you speak to to get recommendations about banks and bankers? Talk to your accountant, attorney or others who are active in your industry.  


Here are some recommendations on what to ask when interviewing banks and bankers

  • Banks large vs. small – It is not so much about one versus the other.  Both are good. What’s most important is gaining access to products and services you need and will anticipate needing and the caliber of individuals you will be dealing with.  Large banks have more products, services and branch locations.  Smaller banks might be more apt to make credit policy exceptions.  How close is their nearest branch to you? How many locations do they have in your service area is also an important factor.
  • Research the security, safety and soundness of the incumbent institution. A great website for this research is:
  • The prospective bankers are just as important as the prospective bank.  That assessment starts at the initial interview. What have they done to prepare for the interview?  Did they do some precall planning and research your business?  Is the discussion focused on understanding your business operations, or just the rate of your loans?  Is this person involving their senior manager somewhere in the discussions? How much experience does this person have? How long have they been with the institution?   How familiar is this person with all of the available products? Does this person have a backup in case they are unavailable?  Are they offering to help introduce you to others who might have a need for your services?
  • Once you have selected a bank, ensure that the banker has set a time to meet with you at least on a quarterly basis to review past, present and future operations. Do they make it a point to review past service experiences, fees and offers made during the meetings?

If you have thought about making a change in your banking relationship or deepening the one with your current banker, keep in mind that either way, it will be a positive in helping your business improve.  From the added layer of advice, increased security and improved operational efficiency, an investment in change can add value to your business.   Furthermore, the current economic climate and heightened banking competition present great opportunities for HVACR businesses to get the most value out of their efforts at finding and using the best possible banking partner.

Business owners also should consider switching banks if they question the relationship with their bank or banker.  Both can have a notable impact on the future success of the business.  Banks can offer many more services than most people think.