Even though a large majority of the nation’s 7,000 community banks are healthy and strong, Dougherty Funding understands the difficult challenge with low loan demand, shrinking earnings and excess liquidity. It’s no surprise that lenders across America continue to search for new ways to grow and originate quality assets for their institutions.
One way banks are replenishing their loan portfolios is through third-party loan participations. Participations allow banks to supplement their own loan originations without having to add extra overhead to source and service opportunities. Loan participations help banks diversify their portfolios outside of their geographic regions, bringing with them the possibility of better financial performance and higher returns. In addition, participations also provide access to unique credits and financing opportunities that community banks traditionally may not have access to due to their size, expertise or capital structure.