To help mitigate the impact of coronavirus on businesses, a local bank is lending a hand to borrowers.
Blue Sky Bank, with branches in Tulsa, Pawhuska, Cushing and Cleveland, said Tuesday it will defer principal payments for commercial borrowers for six months, Blue Sky principal owner Gentner Drummond said.
The arrangement will affect about 1,200 lending relationships and from 3,000 to 4,000 loans, he said.
“Every commercial company, every business in Oklahoma can be affected by this somehow directly or indirectly,” Drummond said by phone. “We went through a list of borrowers and the what-ifs and what will happen to this company ultimately as the coronavirus has its effect on hotels or retail or whatever.
“We really didn’t find an exception. Every commercial borrower is going to be affected. If they preserve the cash that they would otherwise pay back the principal on, then they can deploy that for purposes of rent or payroll or necessary expenses.”
Drummond said the plan was initiated Tuesday. Blue Sky Bank has about $350 million in assets.
“One, we’re showing great loyalty and commitment to our relationships, our borrowers,” he said. “Many commercial businesses have relationships at many banks. So on a granular basis, the borrower that we touch today will reach out to his or her other banking relationship and say, ‘Blue Sky’s doing this.’ I hope every community bank in Oklahoma does this.
“If 25 to 40% of our friends and neighbors are let go or their payroll is suspended, that’s going to have a draconian impact on our community. We are wanting to make sure that households are going to continue to receive income and are able to use the drive through at a restaurant to keep it afloat or pay for their ballet and their piano and their after-school sports, things that will be cut immediately if people don’t have discretionary income tomorrow that they didn’t have a week ago.”
Also Tuesday, Regent Bank urged commercial borrowers negatively affected by COVID-19 to contact their loan officer.
“We are prepared to defer payments, offer interest-only terms and provide working capital, if possible,” Sean Kouplen, chairman and CEO, said in a statement to customers. Regent Bank has locations in Tulsa, Oklahoma City, Nowata and Springfield, Missouri.