Best Practices in Lender Negotiations & Client Management
This session is recognized by the Pennsylvania Economic Development Institute and by the EDP certification program of the Northeastern Economic Developers Association (NEDA).
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(Note: See speaker notice below.)
The development of a financial analysis and the decision to recommend – or deny – approval of a funding request is as much dependent upon your comfort with the borrower and the negotiation process as it is upon the financial review. During this three hour session, participants will delve into two essential areas of the full circle approach: managing the client (beginning before the initial interview) and managing and negotiating with lenders to enhance collateral position. Participants will also be treated to case studies developed with the practical needs of economic development professionals and their lending partners in mind.
Session I – 9:00 am – 10:30 am
Let’s Start at the Beginning
You’ve been contacted by the John Doe Machine Shop requesting financial assistance to fund $500,000 in new CNC machinery. A decade ago, you approved a $200,000 loan to this borrower which was used to start his business and which was paid in full. The business originally created five jobs but, due to recent economic pressures, it has reduced its work force to three. This client has expressed a willingness to meet at your office to discuss the project in greater detail.
Alpha Manufacturing, provider of forty-four full-time jobs in your community, has notified you it’s contemplating permanently closing its doors. Without an adequate infusion of financial assistance, the closure will be unavoidable. The livelihoods of forty-four members of your community hinge upon the continued operations of this business. The CEO plans to stop in to see you within the week.
Happy Acres Farm is seeking financing for a new hog barn. Ag Choice has been lending to this borrower for years and has five mortgages filed on the property. How much do you know about farm operations and the specifics of this one? Should you take livestock as Collateral?
· When do you visit a potential borrower’s business?
· Is a site visit necessary? What is the purpose?
· Is this meeting formal or casual?
· How do you effectively observe?
· You have a report due next week. You know John Doe and his business, but is there value in making the site visit?
Session II – 10:45 am – 12:15 pm
Negotiations with the Borrower and Lender
The John Doe Machine Shop’s loan is prepared for committee approval. Unfortunately, the banker is suddenly advising that he’s funding both a term loan and a line of credit for the borrower and that both loans must be filed ahead of yours. The Loan Review Committee meets in two days. How do you handle this call? Is there sufficient collateral? What if you’re short? Time to negotiate!
You’ve learned that the decision on whether Alpha Manufacturing will close its doors will be made by the company’s home office. The area manager is seeking information now! Time to negotiate!
Only days remain until you close an Agriculture loan for Happy Acres Farm and the client’s attorney is advising a lien search has just turned up two additional liens. Time to negotiate!
· Can you negotiate with the borrower, lender, and the attorney?
· How far can you push an issue?
· Do you have a say in the outcome?
· Who is the problem solver?
· Style, the key to negotiations
Who Should Attend?
No matter your level of experience in lending, this session is designed to provide you with tools that will allow you to increase your knowledge, evaluate your own practices with those of your peers and improve your overall effectiveness as an economic developer.
Note - Change to Presenter
Dewey Adams spent three decades in the banking industry and possesses a unique understanding of the world of economic development. This stemmed, in part, from his organizations' strong belief in cultivating and maintaining close relationships within the economic development community. And this principle paved the way for Adams to serve terms on the loan review committees of currently DCED-certified providers ABCD Corporation, Southern Alleghenies Planning & Development Commission, and the Progress Fund. He has served as legislative appointee to the Pennsylvania Community Development Banks Operation Committee and was recipient of ABCD Corporation’s Richard L. McMaster Financial Mentor Award and the Western Pennsylvania District of the Small Business Administration’s Small Business Advocate Award. Adams’ past positions have included Senior Lending Officer, Senior Business Development Officer, Commercial Loan Center Manager, and Assistant Regional Manager among others. Adams holds a Bachelor’s Degree from the Pennsylvania State University and has also completed numerous courses at the Pennsylvania School of Banking and Pennsylvania Bankers School of Commercial Lending at Bucknell University. He also graduated with distinction from the National Graduate Lending School at the University of Oklahoma.
This event qualifies for (3.00) organizational PDUs (Finance) through the Pennsylvania Economic Development Institute (Institute).*
*A complete explanation is provided in the Guidelines for Certification of Economic Development Organizations (Guidelines) issued by the Pennsylvania Department of Community and Economic Development (DCED) and in the Institute’s Policies and Procedures.
Note: We reserve the right to reschedule or cancel this offering. In the event of a cancellation, a refund will be provided to registrants.