All Things ETF

Got a call back from Jason Haynes, a financial specialist at Wachovia Bank, on our lending issue. The question is: if you had a pretty decent long term relationship with your banker, with all things being equal on your business end, why would your bank decline your request for additional capital? Mr. Haynes replied that, " Wachovia's adheres to pretty conservative and strict lending procedures already, and their lending process is not so much market driven versus the quality of documentation the client is providing for the loan," your debt to income ratio - business and personal, and of course your credit scores . Increasing debt ratios, poor credit scores and improper or bad documentation, could cause your loan to be declined. So, depending solely on your relationship with your banker to get you that loan that your business need may be a bad idea, although maintaining a good relationship could help you in the long run, if your banker keeps you abreast of any new loan ...

Troubled times ahead for everyone it seems. Credit markets still seems to be troubled. The Federal Reserve stands willing to provide liquidity to the markets although modestly. If I was running a pretty profitable business and I needed capital now, could I rely on my existing banking relationship to provide me the capital now? Here is an article in the WSJ on "Prior Loans, Future Pain?" Link . This article is free, no subscription needed . I guess the answer might be how much you need and the terms, but wouldn't you feel slighted if you had a banking relationship with your banker for lets say 10 years and you asked your banker to increase your credit line by about an additional 40% and they said no. In this scenario, with all things being equal, of good personal credit and business scores, pretty robust industry growth projections, and business debt to credit ratio of 1.20 or better. What would be the reason(s) for a bank decline? I called and left a message to a banker...