To run both a bank and a marathon, you better be willing to get up early

SHARE To run both a bank and a marathon, you better be willing to get up early

Tim Maloney has been the Illinois State President for Bank of America since 2009. Under his direction, BOA has moved aggressively into small business lending, even as banks in that sphere have struggled for profits. In 2012, Bank of America extended about $300 million new credit to small businesses in Illinois — a 66% jump over the same period in 2011.

On the eve of BOA’s signature event, Grid sat down with Maloney, 58, to talk about running his first marathon and the city’s small business climate. Incidentally, we also learned that his toenails remain intact.

So the first marathon you’ve ever run is one that’s going to be decked out in Bank of America branding. Pressure?

Someone said to me, ‘the training is much harder than the race,’ and my answer to that was, ‘God, I hope you’re right.’

How’s the workload jive with your schedule?

It’s a huge commitment of time. It’s very challenging, physically and mentally, and it is hard to juggle. You have to get up extra early some days.

How early?

If I run before I get in, I will be out of bed at 3:30 in the morning.

I’m normally approaching that hour from the other direction.

Yeah, well, I’m a little older than you.

There are so many large-scale marketing opportunities in Chicago. Why did BOA choose the Marathon to sponsor?

It’s a signature event. It exemplifies everything we try to do as a company. It benefits the broader economy, $243 million in economic impact. That’s a storefront owner selling more coffee that Sunday. That’s a good thing.

While we’re on the subject of storefronts, you’re making a strong push into the small business credit market, even as competitors remain shy about its prospects. What are you seeing that they’re not?

When you think about a lifecycle from someone in their garage to an IPO, [small business loans] are a lynchpin. We began really focusing on that segment of the business community about two years ago and have hired substantially to grow our capacity to serve small businesses in Chicago. We’ve brought in about thirty small business bankers, many from competitors who might have been stepping away from that marketplace.

It was a marketplace that we weren’t serving perhaps as deeply as we could have several years ago, and it is one we’re focused on now. It’s a significant contributor to the local economy, and we think we’ve just scratched the surface.

When you look at what it means to own a small business in Chicago, are folks optimistic?

We’re clearly in a better spot than we were in a year or two ago. There is still a reasonably healthy dose of caution among business owners large and small. They’re mindful of the risks of growing a business. We try to help our clients deal with more challenging environments — not only economic or interest rate environments, but regulatory environments, the legal framework in which they’re trying to grow their business.

How often are you denying small business loans?

Most small businesses, what they value the most is access to capital. Oftentimes, that initial capital may not be a loan. It might be a credit card facility or a mortgage.

It’s a big deal going from two people to ten to fifty. That places organizational strains. You have to think about payroll and efficiency differently. We have tools.

How small is too small of a loan? What about the business with a terrific balance sheet and promising model that doesn’t have the revenue stream yet? Do you make exceptions?

It’s a balance between having credible and uniform standards that you can apply across the board while also really understanding the individual — what that individual may need and how much credit they really could or should take on and what their future prospects are.

I don’t know that you ever get that balance perfectly right. I will tell you I think we’re more in balance today than we were maybe a couple of years ago when we were emerging out of the difficulties of ’08 and ’09.

What’d you learn from the dark days? How has your approach changed?

The first thing you have to do is stop the bleeding. It was substantial, not just for our institution, but for everyone. Then you have to understand where you might have gone wrong, where you were too lax, or too aggressive. You need to recalibrate your risk appetite and your underwriting standards based upon those learnings. While you recalibrate, you’re going to tend to be more conservative while you get a good handle on it.

If someone has a great idea but no business yet, we’re not going to lend them money. But if you’ve got a real company and you’ve got customers and you’ve got an idea with merit, we’ll take that seriously and work real hard to extent credit in the meantime.

Coming out of the recession, there was lot of finger pointing, both at Bank of America and other national banks. What are the challenges of fighting that perception among small business owners?

The way we can approach that starts with a cultural change internally.

We’re big, we’re powerful, we’re a global institution. We all know that. At the end of the day, we have to establish personal connections both internally and with our customers.

We’ve always had good caring people, but it’s not about unit volume, it’s about holistic service to a customer across the board. And we’ve been working very, very hard about that internally.

We’ve all been through a very difficult period. We know we can do better today than we did yesterday and better tomorrow than we do today. At the end of the day, it’s relationships that matter in business. So the way you repair that brand or approach new customers, you have to approach them with that earnestness, that humility, but also with the confidence that you can do a great job for them.

Alright, one final question. What kind of shoes are you wearing Sunday?

Brooks.

Not Nikes? Aren’t they fellow sponsors?

My other sneakers are Nikes, but those are my running shoes. The Brooks fit my feet the best.

I’m sure Nike won’t be too broken up.

They haven’t approached me personally with a sponsorship deal.

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