Bell Bank Strong and Growing
The merger and acquisition of more and more independent community banks can put pressure on a “bankers’ bank” by reducing its potential customer pool. That reason is partially what led to the planned liquidation and dissolution of Maryland Financial Bank, a $42 million asset “bankers’ bank,” which announced in December that it plans to close this year.
When working with a correspondent bank, it’s important to make sure you have a strong partner on your side.
This means making sure the correspondent bank:
- Is large enough to take the entire participation
This allows you to keep within your bank’s legal or other bank committee limits. Bell’s lending capacity allows us to retain the entire participation. Also, working with only one correspondent makes your staff more efficient.
- Offers competitive, flexible terms
Competitive terms include longer-term fixed rate options to give you the flexibility you need.
- Is experienced
Many banks stopped purchasing loans from community banks during the recession of 2007 - 2009. Some of those banks may have since starting purchasing participation loans again, but if they got out once, think about what might happen the next time a recession hits.
- Has a strong commitment to correspondent banking
Banks experienced in correspondent banking look to do more than either decline or approve a loan. They find ways to work with community banks to improve a participation deal.
- Purchases participations on agricultural loans
It’s a challenging time in the ag industry, so it’s especially important to look for a banking partner experienced in ag industry lending. Bell is committed to helping you take care of your ag customers, and we will help you compete for and retain larger, high-quality agri-business customers.
Bell is the largest independently owned bank in the upper Midwest, and one of the largest in the nation, with assets of more than $5 billion. Because of our size and appetite for deals, we can help community banks with larger deals on our own without needing to find other participants. We have general hold limits determined by risk rating and type of loan, but our goal is to take all of a deal offered to us. We do not sub-sell loans in which we participate; if we buy a $10 million loan participation, we hold it all on our books, so we do not share your bank or customer information with other banks.
Unlike a typical correspondent bank, our focus is working as your partner. We also have a team dedicated to correspondent banking and credit, so we can provide our customers with flexible underwriting, competitive lending terms and prices, fast decision-making and consistent communication. Having partnered with more than 300 other independent community banks in our region, we have experience-based expertise on participation loans, bank building financing, bank stock and ownership loans, as well as business and personal loans for bankers.
When many banks stopped offering correspondent services during the recession, Bell actually expanded our sales and underwriting staff and looked to grow. We started our correspondent banking department in 2003 with no assets and 2 employees. We now have 17 employees dedicated to correspondent banking and more than $885 million in committed assets.
Despite the current down cycle in the ag economy, Bell is still very active in the ag market. With that sector of our portfolio continuing to grow, we have a regional ag banking leader on our correspondent team. Lynn Paulson, our director of agribusiness development, works in ag lending as well as with correspondent banking partners, agricultural operations and businesses across the Midwest.
You expect financial strength, stability and world-class customer service from a 5-star establishment, and that’s what you’ll get at Bell. We’ve once again received a 5-star rating of our financial health from independent bank research firm Bauer Financial. The highest rating the firm awards, a 5-star rating means a bank is financially sound, is operating well above its capital requirements and is considered a trusted institution in terms of financial strength.
As a privately owned bank, we’re able to think longer-term than our publicly traded competitors, so we can make smart investments, even at the expense of this quarter’s or this year’s earnings, knowing it’s the best thing for our employees, customers and our shareholders in the long-run.
Regardless of whether you are a bank with few or many shareholders, if you want to sell your institution or purchase another, it’s important to keep your organization strong through a solid balance sheet and great earnings. It’s also crucial to have a strong customer base.
▶ With our strong, experienced correspondent banking department, Bell Bank can help. Give us a call to find out how.
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