It''s that transparent, is it?
First of all, one thing some members report to us is that they sometimes feel that their banker is feeling competition from the BDC. But in their view, the loans they get from BDC are very often their unsecured loans, and the bank was not interested in the first place anyway, so they don't understand why, from their banker's point of view, there seems to be this kind of competition going on.
We've heard from members in some cases, for example, that their banker had told them they had to disclose all their communications with BDC. On two occasions in the last six months I've heard companies saying that the bank told their client they could not take a BDC loan without the approval of the bank, which is new to me.
In many cases, what we hear is that when they take a BDC loan the bank would right away either increase the interest rate on other loans or would pull back certain loans within a certain period of time. I've seen as short as three months.
In their view it doesn't make sense, because by providing an unsecured loan, let's say to access new markets or just because they're growing their business, BDC is doing a favour to the bank. They're helping the company to succeed and to grow and eventually to repay their other loans.
I don't want this to sound as though it is based on a survey of some sort. Many of our members of course have good relationships with their banks, and they wouldn't call me to tell me that, but these are things that I hear. I don't know that I'm the right person to receive those complaints. Maybe there should be some kind of mechanism—I don't know whether it would be the bank's ombudsman or somebody else—to whom I could send those specific cases.
And I don't want to sound as if all the banks are like this, because sometimes they would change banks and another bank would act differently. But these are things that I keep hearing about: this kind of tension sometimes between chartered banks and BDC in the marketplace.