########################################
#Written by David Tam, 1999.           #       
#davidkftam@netscape.net Copyright 1999#  
########################################

From tamda@ecf.toronto.edu Mon Jul 12 18:28:24 1999
Date: Tue, 2 Mar 1999 06:57:48 -0500 (EST)
From: David Kar Fai Tam 
To: APS 424S 
Subject: #15-03/02/99-"Cautious applause greets B of M's small- business initiative"


The Globe and Mail, Wednesday, February 24, 1999. B9.

	This article talks about Bank of Montreal's pledge to 
increase the amount of money it loans to small businesses. It 
plan's to increase the amount loaned to $20 billion annually by 
the year 2004. Currently, they are loaning $9 billion annually. 
Matthew Barrett, exiting CEO, made a pledge to create a division 
dedicated to small and medium-sized businesses and these are some 
of the actions that will be taken. As well, it plans to double 
its venture capital investment to $400 million. Incoming CEO 
Anthony Comper plans to follow through with this plan.

	Reactions of the small business sector and the Canadian 
Federation of Independent Business (CFIB) are ones filled with 
caution. These critics have always been skeptical about promises 
made by big banks to help.

	In our lectures it was mentioned that even though Canada has 
only five major banks, each one has expertise in providing 
financial services to specific industries. The Bank of Montreal 
is attempting to market itself as focused towards small and 
medium-sized businesses.  In fact, it hopes to develop a 
reputation within these class of businesses. They hope that in 
the future when small businesses think of banks they will 
automatically think of the Bank of Montreal.

	Some other actions include plans to reduce the account 
manager turnover rate which have been detrimental to relations 
with these customers. It also plans to add 1000 more account 
managers to aid this cause. Mr Frank Techar, who will run the new 
division, says that over time his new division will look at 
lending money to companies it would not lend to under current 
criteria. 

	I think this is a good sign for small businesses. Although 
any small business should be skeptical about any promises made by 
banks, these announcements will only help the cause and increase 
awareness, possibly pressuring the other major banks into taking 
more action. I think the Bank of Montreal's plan is quite 
sincere.  It plans to offer small business more than just a loan 
or a line of credit.  It will offer a "variety of value-added 
non-banking services to help ease the pressure in both the work 
and personal lives of customers".  They also plan to expand 
existing programs such as sponsoring magazine advertising for 
small business.

	The Bank of Montreal seems to understand the needs of small 
business since they are not simply making easy promises of 
loaning more to this sector. Any bank can easily make such 
promises and therefore pretend to be pro small business. The Bank 
of Montreal genuinely wants to help small businesses achieve 
success. They understand that simply offering a loan won't help. 
They want to develop long lasting partnerships and gain the trust 
and respect of small businesses. The Bank of Montreal is treating 
this as a long term goal that will be beneficial to both the 
company and the small businesses in the long run. 

    Source: geocities.com/siliconvalley/campus/9640/4thYear/Business

               ( geocities.com/siliconvalley/campus/9640/4thYear)                   ( geocities.com/siliconvalley/campus/9640)                   ( geocities.com/siliconvalley/campus)                   ( geocities.com/siliconvalley)