Financing available for Vermont businesses

Many banks have been hearing a common question from Vermont business owners over the past several months: Are you still lending? And the answer from many Vermont financial institutions is a resounding Yes!
By reading recent news headlines, it is understandable why business owners are asking about available financing. But while some banks might have scaled back their lending efforts, many continue to support local businesses by actively lending and providing lines of credit. And some banks, including TD Banknorth, remain financially strong and stable, enabling them to maintain lending.
Local businesses are the economic drivers for the state. Almost 80,000 small businesses contribute to Vermont s economy and comprise almost 97 percent of the state s employers, according to recent data from the US Small Business Administration (SBA). Financial institutions recognize that small businesses are an integral part of the economy they create jobs and support local communities and that they need access to financing to stay competitive in a global economy.
Unfortunately, many businesses have been impacted by economic conditions that are beyond their control. What we are experiencing today is the aftermath of a perfect financial storm caused by a confluence of factors, including excessive leverage and a lack of oversight at both a corporate and regulatory level - all compounded by a fundamental misunderstanding of the risk-reward tradeoff inherent in investing.
It will take time for the US to work through the fallout from the financial crisis, but our economy is resilient. Banks and local businesses will play a major role in the rebuilding of our economy by continuing to support business growth, which in turn will create jobs at the local level.
To help ensure the success of small businesses, many Vermont banks offer programs and services such as flexible lending options, SBA and conventional loans, lines of credit, credit cards and checking and savings accounts designed specifically for small businesses.
Along with local financial institutions, there are a number of community and small business organizations, including the Vermont district office of the SBA, the Vermont SCORE chapter, the Vermont Small Business Development Center and the Vermont Women s Business Center, that also provide support. TD Banknorth is one of many local banks working with the Vermont SBA to help sustain the state s small business sector through loans such as 7(a), 504, CommunityExpress loans, and loans geared toward veteran-, women- and minority-owned businesses.
Vermont small businesses received 234 SBA loans totaling more than $32 million in 2008. And with the recent passing of the American Recovery and Reinvestment Act, which includes a package of loan fee reductions, higher guarantees, new SBA programs and enhancements to existing programs, the SBA expects the support of small businesses to continue through financing opportunities.
TD Banknorth loaned more than $7 million in SBA loans to local small businesses last year and we expect 2009 to be another strong year in our commercial and small business segments. By avoiding the subprime market and adhering to prudent lending standards, TD Banknorth has been able to remain financially sound during rough economic times. Our smart lending choices and transparent banking practices have contributed to our stability and benefited our customers.
We are hearing from business banking customers that the lack of available financing, reluctance to incur additional debt and/or reduced product demand are top-of-mind concerns. We understand that business owners are taking pay cuts and taking out additional mortgages and lines of credit on their homes in order to pay their employees. We applaud their selflessness and their grit, and we want business owners to know that resources are available.
Start by talking to your financial institution. Keep the lines of communication open and share your concerns, benchmarks and goals for the upcoming year and beyond. Ask which programs are available to you and if there are special rates that apply to you. Tap into the local resources available to you. Between the government, community organizations, educational facilities and financial institutions, there is support available to you and your business.
Small businesses are the backbone of our communities and deserve a sound financial lending partner they can turn to for support. They also need access to capital for survival and growth and it is the role of lending organizations to work with business customers to ensure that happens. The financial industry realizes that these are unprecedented times for business owners, which is why we are keeping the lines of communication open. We want business owners to hear banks when we say Yes, we are actively lending, so we in turn can hear them tell customers Yes, we are open for business.
David Estes is the Regional Vice President of Retail Banking at TD Banknorth in Vermont, and has been with the bank for almost 10 years. He also sits on the board of the Vermont Small Business Development Center. Based out of Burlington, he can be reached at [email protected]. For more information, please visit www.TDBanknorth.com.