Issue link: http://read.dmtmag.com/i/114548
A Closer Look When an issue arises with a dealer, the BOKF Equipment Finance team seeks to first understand why something is happening and then work proactively with the dealer to find the best way to approach the problem. Another lender might look at a loan in a vacuum and say "this loan does not conform to our policies. We want it off our books." However, in the end, loans have to make sense for the bank and the customer. "Anybody can make loans when times are good," said Killpack. "It's keeping your customers healthy when times are bad that separates investors from lenders. A good lender tries to find a way to continue to do business; an investor just wants his money back." While the construction equipment market has improved, challenges remain. According to Killpack, the biggest challenge is uncertainty. "Contractors don't want to buy, they want to rent," he said. "Dealers are essentially becoming the bank for their customers." This makes it even more important to have a lender who understands your business and the market trends. According to Killpack, it is imperative for both dealers and lenders to understand the drivers of the emerging rental market. Staying Out of the Dealer's Way One thing that BOK Financial does not want to do is get in the dealer's way with excessive reporting requirements. "The reporting we ask for is consistent with what dealers should be doing," said Killpack. With some lenders, dealers can find themselves burdened with reporting; for example, a dealer that BOKF Equipment Finance worked with had nine different lenders, with most of them coming out four times a year for audits. As a relationship lender, BOKF Equipment Finance helps dealers avoid that burden and spend more time on running the business. Killpack recommends that dealers consolidate finance sources to reduce disruptions to the business caused by reporting requirements and audits. Killpack makes it clear that BOK Financial seeks to work with dealer clients in good times and bad. Historically, he says, when loan covenants have been broken, banks have been quick to react, and at times make adjustments to the loan structure which does not sit well with dealers. BOKF Equipment Finance will work with dealers Mark Killpack, senior vice president, BOKF Equipment Finance Group says: "Anybody can make loans when times are good. It's keeping your customers healthy when times are bad that separates investors from lenders." At a Glance: BOK Financial Equipment Finance Parent Company: BOK Financial, (NASDAQ:BOKF) Assets: $28 Billion Equipment Financing Solutions: n Inventory floor plan lending n Working capital loans n Support equipment lending n Aircraft lending Full Service Banking Solutions: n Term credit facilities n Revolving lines of credit n Leasing n Letters of credit n Cash management n Corporate trust services n Investment services n Retirement plan services n Wealth management Ideal Customer Profile: Multilocation construction equipment dealers with multiple revenue streams operating in diverse markets. to understand first why covenants were broken and second, to work toward an agreeable solution. Why the difference? BOKF Equipment Finance does not look at covenants as a revenue source or as a way to trap dealers and then find ways to escape when times are tough; rather, the company views a covenant as a tool to ensure the liquidity and leverage of the business. What They Look for in a Dealer The BOKF Equipment Finance Group was formed in 2004 with Texas and surrounding states as its original territory. As a direct result of the success of the group over its nine-year history, that territory has expanded to include 26 states. However, the group is not seeking to grow its business by partnering with every dealership. Ideal customers are construction equipment dealers with multiple locations and multiple sources of income. They are diversified into multiple market segments such as forestry, highway, aggregate and oil and gas, with AED membership viewed as a positive. If your dealership meets this profile and you are looking for competitive financing from a partner that truly understands your business, it may be time to start a dialogue with BOK Financial. Call Mark Killpack at 602-808-5341, or e-mail him at mkillpack@bokf.com n March 2013 | Construction Equipment Distribution | www.cedmag.com | 49 48_A Closer Look_KP_final.indd 49 2/28/13 4:54 AM