16. Managing your banking relationship – The Sequel

With yet another banking mis-selling scandal hitting the headlines shortly before Christmas last year, the title of our related article ‘Can you bank on your relationship manager?’ now seems more appropriate than we could ever have envisaged.

The link is made with tongue firmly in cheek of course; many bank managers are keen to support their clients, as those that we regularly speak to in the SME arena strongly and actively testify.

In our original blog we came at this from the perspective of the business owners, and this time round Tectona have actively sought feedback from our banking partners themselves; this is what they told us.

In it for the long term

One relationship manager that we spoke to highlights ‘the need for business owners to consider the bank as a key partner to the business’ as absolutely critical to building a mutually valuable, long term relationship.

Another tells us that it is hugely important for bankers to ‘justify the cost of the services’ by offering a service that ‘goes well beyond the customer’s typical expectation’.

Banks and their relationship managers have a role outside of simply providing funding to their clients. This may involve providing access to a wider community of businesses to their SME customers through an online portal; Barclays Connector for example. It may involve providing access to content and competitions to support business growth such as HSBC’s Global Connections initiative or the advisory and consultancy service from RBS Mentor.

However it is that banks look to cement this long term relationship, the key message for SME owners from relationship managers is ‘take advantage of what is on offer’.

Communicate to accumulate

Banks are businesses too, and they have a very real interest in building the right relationships with their business clients – successful clients provide the bank with a source of sustainable profitability.

You may be an SME owner who does not want to build a relationship with the bank; you may want ‘a hands off approach’ from your relationship manager. Your relationship manager won’t know unless you tell them.

The key here is communication. Communicate what type of relationship you want, and what level of advice you require.

It is also absolutely critical to provide the bank with up to date information on a regular basis; for example updated business plans or your latest financial accounts. Not only to allow your relationship manager to understand how the business has performed, but to allow them to understand where you want the business to go.

Banks do not like surprises, and if information is provided too late, or not at all, it’s not only your relationship with the bank that can suffer. Your whole business could be adversely affected if the bank is put in a position where it can no longer provide sufficient support.

Of all the feedback we received from relationship managers, what really summed up the attitude of all that we spoke to was their collective desire to be seen as ‘trusted advisors’ to their clients. Advisors who are able to help drive forward the businesses of their clients.

As with any relationship, you will get out of it what you put in. So by taking a proactive approach to your relationship with your bank, and by allowing your relationship manager to become a part of your business you will find that you can, in fact, bank on your relationship manager.

To find out how to extract maximum value from your bank relationship, or if you would like to discuss any of the topics covered above, please contact us through the Tectona Website or call Mark Nicholls on 07818 407061 or Ronnie Epstein on 07543 275902.

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