Like many of you I’ve been glued to the financial news outlets over the past ten days, witnessing the SVB and Signature trainwrecks and watching for signs of contagion. I think that both of those banks were operating on the edge (and went over), and I think that the actions taken by the regulators will proof us against contagion. But I have to admit to myself that I don’t really know.
But inaction, even in the face of uncertainty, is not an option for a commercial SBA lender like Gulf Coast Small Business Lending. So, we reflect on what we do know (the basics), and continue to follow the rules and practices that have worked well for us in the past:
- We don’t invest in what we don’t understand. That’s where the risks hide, and if we don’t understand them, we can’t plan for them. If you apply for an SBA loan from Gulf Coast Small Business Lending, please be prepared to explain to us what your business is since there is a good likelihood we don’t understand it as well as you do.
- Once we understand the risks and determine that we can accept them, we make the move. We are SBA lenders. There is no use for us unless we lend, and our job can be summed up as “understand the risks and make the investments.” Not making loans is simply not an option.
- We stay in our lane. Our product, the SBA 7(a), is specialized and highly regulated. We have an SOP and the resources of the SBA to help us ascertain eligibility when we are stumped by a unique situation. So, we go all out to support borrowers, but only within the guardrails that are in place. We stay firmly in our SBA lending lane.
- We diversify, diversify, and diversify. And did I mention that we diversify?
My team and I are available to talk with you if you have questions or concerns or simply want to talk through an SBA loan scenario. You can reach out to me through LinkedIn and my team through the Our People page on our website.