Commercial Lending

One of the main revenue sources for banks is the interest made on loans they lend. A key way to generate commercial loans is through marketing and advertising better terms that can include low interest rates and the lending of larger sums of money to develop a rapport between the bank and the customer. Small banks advertise their services by being active in their communities, sponsoring events, donating to charitable organizations even sponsoring little league teams. Larger banks and global institutions spend their T&E accounts wining and dining CEOs, CFOs, and senior government leaders to attract lucrative partnerships.

Banks and other lending institutions have been a bit stingy during the financial crisis that started in the summer of 2008, and they've curtailed their lending. Los Angeles Times reported in February 2009 that 64 percent of banks tightened their restrictions for commercial and industrial loans to large and mid size companies, compared to the 32 percent a year earlier that said they had made loans harder to get.

The people who make lending happen are the bank's loan officers, who find potential clients and help them apply for loans. They also investigate the creditworthiness of their clients by gathering the company's pertinent financial information. These officers also evaluate the risk of the loan and in large banks they must convince their credit committee that the risk is manageable enough to profit on.

Loan officers need to have a bachelor's degree in finance, economics, or other related field. These professionals need to have exceptional sales skills as they are in a competitive climate where many institutions are offering loans as businesses flounder. Loan officers on average earn around $63,000, based on the U.S. Department of Labor's 2007 statistics. According to recent online figures, loan officers with little to no experience are netting about $33,500, whereas those with 10 years of experience or more are banking in the high $40s.