Bank of America’s small business ambitions
Bank of America suffered some bad PR recently after reports it had altered the terms of some credit lines to small businesses.
Bank of America asked some small business customers to pay off their credit line balances all at once instead of in monthly payments or agree to a new repayment plans with far higher interest rates than. Bank of America said the move affected a small number of customers and imposed standards that were somewhat conventional. Still, the “credit squeeze” obviously did not go over well with the public.
Let’s hope the bank generates a more favorable response to its recent announcement that it will hire 50 bankers in New England that will work with small businesses. The hires are part of a previously announced plan to hire 1,000 small business bankers across the country by the middle of the year, notes the Boston Business Journal.
The goal is to provide a resource so “clients will have convenient access to local small business expertise and a dedicated resource who knows their business. Small business bankers will consult with small business owners at their place of business and assess their companies' deposit, credit and cash management needs.”
In the end, it remains unclear if this is a massive financial commitment or not. In some ways, the bank is shrinking its footprint to survive. And its lending terms for small businesses may not be quite as favorable as other banks. To a certain extent, a similar “shrink” is underway in the consumer mortgage market, a market in which some experts think the bank is losing ground to the likes of Wells Fargo.