Community banks play big role in local economic expansion

By Rebecca Rose

Killeen Daily Herald

Community banks are playing a big role in business growth, with institutions stepping up their relationships with local entities, offering guidance and long-term support.

John Crutchfield, executive director of the Greater Killeen Chamber of Commerce, said regional banks play a key role in community development.

"It is important to remember that banks are investors who fundamentally operate a business of lending the use of their capital to others who have a need for it," he said. "Banks provide capital to fuel the economy of a community. Without available capital, growth is restricted."

Capital will find its way to stable markets characterized by demand for financial services, caused by growth, and relative security, said Crutchfield.

And Killeen is becoming an increasingly attractive market.

"We have a growing population, a very stable, expanding economy and considerable pent up demand for many products and services," he said. "Banks figure this out and, to them, it spells opportunity where, sadly, in this economy, a similar opportunity may not exist in many other markets."

One big aspect of economic development local banks are playing a key role in is business development.

Small businesses employ more than 50 percent of American jobs, and account for 60 percent of job creation, according to the U.S. Treasury Department. In Texas, Bell County ranks among the top five counties with local businesses that receive U.S. Small Business Administration loans.

Training programs

Brian Townley, senior vice president with The National Banks of Central Texas, said local banks help the economy grow by facilitating new business development.

The institution sponsors business-training programs to provide new and existing businesses with educational tools to help structure their business by teaching organizational planning, said Townley.

"This training opportunity provides the evaluation tools and action steps business owners need to maximize the growth and profitability of their business," he said. "We want to help them project where they want to be in three, five, 10 years and beyond. Then we go to work and identify resources to assist the planning process to establish their goals and strategies."

And the area's ever expanding growth will continue to press the need for more new businesses.

"The foundation is Fort Hood," said Thomas Sinkey, senior vice president and business development officer with Extraco Banks. "They're a very strong economic factor."

Military, families and retirees opting to stay in the Killeen area make the region attractive for banking institutions looking to expand their footprint. A growing population creates demand for new businesses and services, who look to banks to finance their growth.

"That's why (the area) continues to expand," said Sinkey, noting recent development along State Highway 195, including the new Texas A&M University-Central Texas building.

Building relationships

Focusing on one-on-one relationships with small-business owners, especially first-time entrepreneurs, is a priority for Sinkey.

"There are several thousand small-business owners around here," said Sinkey. "The last time they talked to their banker was the day they came to open their account. The reasons so many businesses around here fail are financial. They had great ideas, great plans and great skills. But they don't have the financial skill to manage their money."

One big mistake first-time business owners make is maxing out personal credit cards to pay for costs while trying to build a business. Starting with working capital is an important aspect of a small business' ultimate success, said Sinkey.

Having high credit card debt could prohibit any bank from providing a business loan, said Sinkey.

"It's going to be hard for any bank to lend money to someone (who has) had bankruptcies or delinquent accounts," he said.

But it's not impossible to overcome. "Look at your credit report and find out what's on there," he said. "Get things current and pay things off. Every business starts out as a mom and pop. Running that business the right way and having the right support mechanisms are key to long-term growth."

Contact Rebecca Rose at or (254) 501-7548.

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