Fifth Third Bank increases commercial loansWritten by Duane Ramsey | | firstname.lastname@example.org
Banks have recapitalized and are ready to loan money as the commercial and consumer credit markets are open again according to executives at Fifth Third Bank who discussed current trends in commercial credit markets at a forum held July 25 by the bank in Toledo.
“We feel pretty good about the economy. It is getting better out there but it’s still very fragile,” said Bruce Lee, executive vice president and chief credit officer at Fifth Third Bank.
Fifth Third has some of the highest capital in the industry as its revenues continue to grow, according to Lee. The bank lent $8.2 billion in new commercial loans to customers in the first six months of 2012.
“We’re open for business on the loan front. The credit quality is as good as it’s been in four years. Things have improved significantly since 2008,” said Robert LaClair, president and CEO of Fifth Third Bank of Northwest Ohio.
Fifth Third lent $53 million in new commercial loans and $40 million in new consumer loans in Northwest Ohio in the month of June, LaClair reported. The bank anticipates lending $175-180 million in commercial loans, $25 million in consumer loans and $400 million in mortgages in the region this year.
Fifth Third recently announced its results for the second quarter of 2012 with net income up 14 percent. The bank has loaned $4.6 billion at an average of six percent overall in the past 12 months, according to LaClair.
He called Lee a “Northwest Ohio guy” when he introduced him to the audience of bank officials and customers at the Toledo Club. Lee formerly led the commercial lending division and headed Fifth Third Bank in Northwest Ohio from 2003 to 2005.
“It’s great to be back in Northwest Ohio,” Lee said.
They reported that Fifth Third Bank has invested $700 million in Northwest Ohio this year. As the 12th largest bank in the U.S., all of its resources are delivered through the community bank model, LaClair said.
“Fifth Third is a Main Street bank not a Wall Street bank. We have a very diversified platform and love marketing in the Midwest,” Lee said.
Toledo is a mature market with a low cost of living and doing business. Unemployment is down to eight percent but the workforce is at an all-time low here.
Residential construction and development has begun to pick up with a recent rise in home prices and new home starts.
“Consumers and businesses have done the right thing by deleveraging but are cautious to start spending. Many businesses are not willing to capitalize and hire people yet. They could invest but don’t think it’s the right time. It’s a real challenge right now,” Lee said.
Fifth Third Bank recently announced that it will offer four additional loan products from the U.S. Small Business Administration (SBA) program for commercial clients in Ohio. As an SBA Preferred Lender, the bank will be able to extend credit and financing options to help small businesses expand, improve working capital or enter into new markets.
“We hope it increases SBA lending for Firth Third. We’re trying to come up with new programs so people can access money in more non-traditional ways,” Lee said. “I really like the program for veterans and their spouses.”
The Patriot Express Loan is for veterans and members of the military that want to establish or expand small businesses and other purposes. Current spouses and widowed spouses of service members are eligible for the Patriot Loans.
The CAP Lines Program offers small businesses a revolving line of credit that can aid in financing contracts to address short-term and cyclical working capital needs.
SBA’s Export Express Loans benefit businesses that have been in operation for at least 12 months and can demonstrate that loan proceeds will support export development activity. Loans under this program can be term loans or revolving lines of credit.
SBA International Trade Loans provide small businesses with financing options to support export transactions and help them enter or expand into international markets. This program offers a combination of fixed asset, working capital or debt financing options.
“Through these SBA loan products, Fifth Third is committed to helping small businesses manage their cash cycle and create jobs to help fuel our recovering economy,” John Bultema, executive vice president and head of Business Banking for Fifth Third Bank, stated in a press release about the programs.
In addition, Fifth Third Bank broke ground July 24 for the construction of its new Point Place Banking Center at 4706 Summit Street. The new center will replace the existing Point Place branch and be located next door to it.
The new Point Place Banking Center will be Fifth Third’s first green banking center in Ohio. The facility was designed to use less energy and water than standard buildings and incorporates a number of advanced features to lessen its impact on the environment.