Tag Archives: Tim Bruckner

Credit Unions Big Boose to Small Business - AZ Business Magazine September/October 2011

BMO Harris Bank boosts credit to AZ business owners

BMO Harris Bank is making an additional $2 billion in credit available to businesses in Arizona over the next three years.

“We’re here to help, making more of our balance sheet available to businesses to support growth opportunities and help create new jobs,’ said Tim Bruckner, Arizona Commercial Banking Manager, BMO Harris Bank.

“We have heard from our customers who say they are upbeat on the economy. A BMO Harris report shows that more than 60 percent of Arizona business owners and CEOs plan to make at least one investment in their business this year,” added Mr. Bruckner.

“The Arizona economy is poised to accelerate in 2015, supported by an improved labor market and a recovery in the housing market,” said Michael Gregory, Head of U.S. Economics, BMO Capital Markets. “Real GDP is expected to grow 3.4 percent, slightly higher than the national average and improved from the 2.5 percent expected in 2014. 

Mr. Gregory noted that improved business confidence should maintain solid growth in investment and hiring. Gains are expected in job growth, coming from the service sector – led by professional and business services, education and health and tourism. “The state is on track to add about 55,000 new jobs in 2015.”

capital

How can companies increase chances of securing capital?

Silicon Valley Bank committed to lend or invest at least $100 million to technology and life science companies based in Arizona over the next five years, yet many experts say lack of money is preventing the state’s tech sector from exploding.

“One area we still need to improve is in the area of capital availability,” said Steven G. Zylstra, president and CEO of the Arizona Technology Council. “Arizona lags behind our competitors in terms of access to capital.”

So what are banks looking for in up-and-coming companies in order to decide if they are worth the risk?

“There is a misconception about business lending, particularly with start-ups, that the application — all of the factual data surrounding the request, the projections, financial statement of the owner and business plans — are the most important things,” said Tim Bruckner, managing director and regional manager of commercial banking for BMO Harris Bank. “Though these items are important in underwriting, we are really looking for entrepreneurs that also show the ability to adapt to a changing environment, demonstrate knowledge and passion for their business and show solid understanding of where their business fits in its competitive environment. Too often, business owners overlook a banker’s interest and understanding in these areas.”

With that said, it is very difficult for a traditional bank to finance a start-up or new business, according to Mike Brown, Arizona regional president at Washington Federal.

“However, the ones that make sense have a well-developed and thought-out business plan, coupled with a strong guarantor,” Brown said.

Ed Zito, president of Alliance Bank of Arizona, the largest locally headquartered bank in Arizona, said Alliance looks at a start-up’s firm capitalization, cash position, “cash burn” rate and cash flow margins.

“Start-up company financing is a risk to be borne by the equity investors,” Zito said. “That said, accounts receivable, support by the ownership or equity investors can mitigate start-up risk.”

So when can a start-up do to increase its chances of getting financed in today’s heavily regulated and competitive economic climate?

Before you get started, Bruckner said to seek counsel from someone who has done it successfully.

“It is always good to hear the success stories, but these individuals will also have great insight into the stumbling blocks and things they would have done differently if they knew then what they know now,” Bruckner said.

Bruckner said first-time borrowers should also demonstrate that they have planned for contingencies, such as a cash shortfall or potential loss of a key customer.

“A start-up’s best chances at securing a loan is having an experienced management team or ownership, knowledge of the industry, proprietary product, service, technology, a demonstrated marketplace acceptance of the product or service and the ability to sustain the start-up until the company is cash-flow positive are crucial factors to consider,” Zito said.

Brown said that it’s imperative for new companies to have well-crafted business plans with reasonable targets to achieve.

“Make sure all financing sources are covered, because everybody has their particular niche or focus and your plan might fit that focus,” Brown said. “Look at traditional sources like banks, but engage all non-traditional sources like independent finance companies.”

Deloitte Report Reveals Mid-Market Companies Expect U.S. Economic Growth

BMO: Arizona economy will accelerate in 2015

Arizona’s economy should pick up in 2015, with expected GDP growth of 3.5 percent, just ahead of the national average and an improvement from the expected 2.5 percent in 2014, according to the bi-annual U.S. State Monitor Report from BMO Economics. Steady population growth and job growth in the high-tech market will also help lead the state’s economic acceleration.

Arizona is again outperforming when it comes to job-growth. Nonfarm payrolls rose 2.5 percent year over year in the fourth quarter. The service sector, led by professional and business services, education, health and tourism, has been responsible for the gains.

Robert Kavcic, Senior Economist, BMO Capital Markets, noted that better momentum could be on the horizon for manufacturing and construction employment. The unemployment rate continues its negative trend, 6.7 percent in December compared to 7.6 percent a year earlier. On the flip side, there is an underlying softness in the labor market as evidenced by average weekly earnings which were down 2.8 percent year over year in the fourth quarter.

”We continue to see increased activity in several sectors, including healthcare, trade and distribution,” said Tim Bruckner, Managing Director, Commercial Banking, Arizona, BMO Harris Bank. “We also know that the majority of Arizona businesses are planning to invest. We’re here to help support business owners as they lead Arizona’s economic recovery.”

The housing headwinds experienced in 2014 appear to be fading slightly with a decrease in rates and mortgage lending conditions somewhat softening. The S&P Case-Schiller Index reported that Phoenix prices are up year-over-year by 2 percent, but that is still a giant downward shift from the 20 percent-plus growth experienced early in the recovery. On the positive side, the vacancy rate is now back down to match the fifty-state average.

Stronger population growth is helping to drive an improved economy, which is steady at a 1.3 percent year-over-year clip. Overall interstate migration remains depressed, somewhat due to the impact the housing market’s decline has had on mobility.

“Population inflows for Arizona, while still positive, would be stronger were it not for the decline in the housing market,” said Mr. Kavcic.

To view a full copy of the report, visit www.bmocm.com/economics.

Deloitte Report Reveals Mid-Market Companies Expect U.S. Economic Growth

Arizona business owners optimistic for 2015

BMO Harris Bank released a study that found that business owners and executives in Arizona were optimistic about the prospects for the state’s economy in the coming year.

Eighty-six percent of respondents feel Arizona’s economy will grow or stay at the same level in 2015 (39 percent say it will improve, 47 percent think it will remain the same). That outpaces their optimism in the national economy, where only 63 percent feel the U.S. economy will improve or stay the same next year. More than one-third (37 percent) of the respondents believe the U.S. economy will worsen in 2015. Arizona business owners’ local confidence is reflected in their positive attitude regarding growth in their own business, with more than half believing their business will grow next year.

“While there are some causes for concern, both internationally and domestically, business owners and executives continue to exude confidence in their ability to grow their business in today’s economic environment“, said Tim Bruckner, Arizona Head, Commercial Banking, BMO Harris Bank. “That continued confidence is vital to the business-led economic recovery that has taken place over the past five years.”

The survey asked Arizona business owners/executives if they believe the U.S. economy will improve, stay at the same level or worsen in 2015.
·         41 percent expect the economy to improve
·         22 percent expect the economy to remain at the same level
·         37 percent expect the economy to worsen

The survey also asked the same respondents if they believe their business will grow, stay at the same level, or shrink in 2015.
·         51 percent predicted growth in 2015 for their business
·         32 percent expect their business to remain at the same level
·         17 percent believe their business will shrink in 2015, an 11 percent increase from last year’s results

BMO Harris Bank conducted the same survey one year earlier, and the Arizona results this year were similar compared to 12 months ago with a few exceptions: In 2014, one-fourth of business owners expected the U.S. economy to worsen. That number this year increased to 37 percent. A year ago, 38 percent felt the state’s economy would stay the same. In the most recent survey, 47 percent of respondents expect Arizona’s to remain the same..

“The coming year is being heralded by positive momentum in consumer spending, which is music to businesses’ ears,” said Michael Gregory, Head of U.S. Economics, BMO Capital Markets. “Spending is finding support from strong job growth, lower energy costs and an appreciating U.S. dollar. In reaction to continued sturdy consumer spending, we look for more businesses to expand their production, lifting both capital expenditures and hiring. This job-led, domestic demand should propel economic growth 3% in 2015, the best result in a decade.”

The survey was conducted by Pollara with an online sample of 781 American business owners between September 8 and 18, 2014. A probability sample of this size would be accurate to +/- 3.5 percent, 19 times out of 20.

smartphone

Arizona Executives Don’t Vacation Without Smartphone

BMO Harris Bank released a study today that found that most business owners and executives in Arizona do not truly “get away from it all” when it comes to vacationing. Seventy-three percent of the respondents admit to checking their work emails during their time off; albeit 11 percent lower than the national average.

“Gadgets such as smartphones have been instrumental in making it easier to stay in touch, contributing to increased business productivity,” said Tim Bruckner, Managing Director, Commercial Banking – Arizona, BMO Harris Bank. “The flip side is that same instant access fuels our need to stay connected at all times.”

Nearly half (42 percent) of those surveyed regularly work more than 40 hours each week. That “always on the clock” mentality translates into long hours focused on work. While 61 percent of the Arizona respondents describe themselves as workaholics, only a small percentage of them (six percent) cite their workaholic tendencies as the primary reason for their success.