Shane Dingley, Managing Director of Business Brokers Queensland and the Treasurer of the Australian Institute of Business Brokers, has reported to us his experience of a renewed appetite on the part of some of the major banks to lend to the SME sector. Shane reports:
In line with the clear changes in buyer activity, we are now seeing the active promotion of optimism by the banks when it comes to small business lending. In particular, the recent announcement by ANZ on their pledge to provide $1Billion in funding for small business startups, and this intention has been consistent when we talk to the frontline bankers at ANZ as well. In some of our projects we are seeing not only support from banks for funding applications but also proposals that include some portion of unsecured funding, and the banks have indicated a willingness to fund up to 50% of the acquisition. We are hoping that this move by ANZ is going to stimulate some competition for business lending between the banks and particularly with NAB who have recently indicated an aggressive strategy for growing their business lending although we haven’t seen anything published on this.
It’s difficult to know what the market will provide this year with so much negative press around and so much uncertainty regarding the election and recently the fall in the AUD, but in general we believe the signs are there for a much better year than the past two years. Every broker has a different story, but our own experience is showing buyer inquiries this year to date at around twice the volume of the same time last year. Part of that is related to a stronger portfolio of businesses for sale, but not all of it. Among those buyers, we are also seeing much more intent and urgency to buy, not only in the small business category below $500k but also for medium businesses up to $2M. We even have competition between buyers and offers above the asking price which we haven’t seen since 2008/09.
Shane Dingley is the Managing Director of Business Broker Queensland and Treasurer of the Australian Institute of Business Brokers. Business Brokers Queensland is a professional business brokerage firm specialising in the sale of small to medium businesses in Queensland. Shane is contactable on (07) 3297 8700 or email: [email protected]
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