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How the SBA 504 Experts will help Re-imagine the Community Bank of Tomorrow…
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A little over one week ago, we announced what I called “the most exciting news I’ve had to report in years” — the merger of Mercantile Capital Corporation (MCC) with Old Florida National Bank. Overwhelmingly, the responses we’ve received have been tremendously positive. We’re extremely appreciative of all the well-wishes and the enthusiasm kindly shown us.

In that original post about the merger, I also mentioned that I’d explain more about what this move means for MCC and why it’s the next, right step for our company. Press releases can only convey so much, and I think it’s important to demonstrate how we expect this merger to help our current and future Clients, create shareholder value, and establish a valuable local institution worthy of our great community.

I’ll summarize four synergistic qualities of this coming-together of MCC and Old Florida National Bank, and then you should tell me whether you agree with our reasoning. So here we go . . .

The MCC/OFNB merger does the following:

1.      Improves our business model to keep pace with our torrid growth. Within the structure of a bank, we can now use the financial strength of the bank rather than rely on commercial warehouse lines of credit to fund our deals. This is not only a safer plan in today’s uncertain economic environment, but also a more consistent source for us. This has been the business model of the banking world since checks were first carved on stone tablets, but we’ve never been able to properly deploy it for ourselves or for our Clients, until now.

You might recall that over three years ago, we began working in this direction only to run into the buzz saw that was the global financial meltdown, and regulators became more concerned with propping up failing banks than with allowing a successful company to charter one. (If you sense some lingering resentment in my words, you’ve sensed correctly. But I have a feeling I’ll finally be able to put all this behind me before long . . . especially working with high-quality business partners like the people at Old Florida National Bank.)

2.      Maintains our independence/autonomy. MCC will be a wholly-owned subsidiary of Old Florida National Bank. We won’t be giving up our name, our branding, or the fanatical customer service that we’re known for. All of our bright, hard-working employees are staying on with us as well. The biggest change you’ll see from us will be our address as we move from Altamonte Springs to Winter Park. In short, this is a huge opportunity for us to continue doing what we humbly think we do better than anyone else.  Only now, we’ll be even better equipped to do it for you and those you know.

Now, you’ve probably read the same stories we have about mergers that implode months or years later, when executives forget why the deal made good business sense in the first place. The only thing that can ultimately mitigate that occurring in any merger is the quality of people involved and the legitimacy of the vision worth pursuing. We humbly believe we’ve met our match in terms of decent, honorable businesspeople in Old Florida National Bank, and we think you’ll soon agree with us (if you don’t know so already). Time will tell, but we expect this merger to be one of those very un-newsworthy ones due to its seamlessness and maintaining the original intentions of all parties involved.

3.      Allows us to offer banking product/service solutions to our existing clients and referral sources. When Geof [Longstaff] and I launched MCC in late 2002, we wanted to focus on one under-utilized small business loan program (the SBA 504, or what we now call the “SmartChoice(R) Commercial Loan”). Equally important to us was that we become the very best in the country at providing it. We were laughed at regularly in the beginning, and our ambitious yet focused plans were scorned by many in the banking world. When we look back, we’re very happy that we (perhaps naively) ignored the conventional wisdom and stuck to our knitting.

Over the years, however, many of our clients and referral partners have confessed their wishes that we provide other banking products and services with the same level of zeal, expertise, and service with which we provide SmartChoice(R) Commercial Loans. Well, this merger will finally allow us to do just that. You may share our belief that competence increasingly seems to be in short supply these days . . . so this merger will provide a platform for us (and our new business partners) to expand our competencies into other realms for you. The relationship you have with your bank doesn’t have to be merely acceptable, mediocre, or even boring. Which leads me to my fourth and final point, that this merger . . .

4.      Re-imagines the community bank business model and culture. With the blending of forward-thinking, eager-to-please, and hard-working employees from both companies, we believe we can create the community bank of the future. We aim to “re-imagine” (in the words of business guru Tom Peters) what it means to be a great community bank . . . at a time when so many are folding and going away. To provide the superior customer service that only dedicated smaller institutions can provide, combined with the sophistication and breadth of solutions typically found only from the largest corporate entities.

The events of the past few years have revealed the hubris so many banks displayed in forgetting the best elements of the past, merely in pursuit of the next “new” thing. We believe what’s old can be (partially) new again . . . that bringing the best practices from yesterday into modernity is the best way to forge ahead. Plenty of banks have said they “look out for their customers first and foremost,” but most of us know that’s merely their flavor-of-the-month advertising campaign. For us at MCC, we’ve been living this virtue since we started: providing the best commercial loan product for owners of small and mid-sized businesses, even when it means sacrificing our revenues and profits . . . unlike so many of our competitors, who’ve pushed less-attractive, but more profitable (for them) loan products instead. You might even recall that Geof and I are two of probably only a handful of lenders nationwide to actually use our own lending program ourselves . . . that’s how much we understand its superiority. MCC/ Old Florida National Bank won’t offer every possible solution to the marketplace, but you can rest assured that we’ll diligently strive to be the best at the services we DO provide.

To us, banking seems to be at a crossroads. We don’t think it’s in your best interest that the number of banks continues to dwindle and only the behemoths are left standing (often with government support). We live in a time when many smaller, personal enterprises compete well with the Goliaths of their industry. Faster, innovative, neighborly, and more nimble aren’t attributes normally associated with our banking brethren these days, but these traits are necessary ingredients for every great community bank of tomorrow. We think our merger with Old Florida National Bank is the next, right step in this very helpful direction.

Dedicated to Your Continued Success,

Christopher G. Hurn,

[Still the] CEO/Cofounder of MCC

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  1. Robert Fay says:

    Congratulations on your merger. I’ve lived through many of these over the years in the banking industry and know that they can be very challenging and time consuming. As an SBA Lender in a small RI community bank, I have to wonder how this will affect us? Will you be diverting your attention from the 504 Program into marketing other bank services in the Florida market only or will you be offering community bank products throughout the USA?

  2. Gerald D. Shotts, Jr says:

    Chris, Congrats, Change is always difficult but I know you … and you did this for the betterment of your company, your staff, and your customers. GOOD LUCK and continued success.

    Warm regards,


  3. Jim Rowe says:

    I am new to MCC

    Your approach to small business loans and wealth building makes all the sense in the world. The merger should improve your operation. A concern might be that a community bank/local bank in recommending MCC/Old Florida Bank as a service to a customer they do not want to fund but want the depository accounts might be reluctant where they would not be if they had to deal with MCC only as a non-depository lender.

    I am a commercial realtor/consultant/developer and am looking into the commercial mortgage brokerage business.

  4. Chris Hurn says:

    Robert: It won’t be either/or. I won’t be diverting my attention away from SBA 504 loans, but we will certainly help market our other bank products and services in the future. Other than us continuing to do 504 loans nationwide, most of our other services will remain geographically-focused on the Central Florida market.

  5. Chris Hurn says:

    Thanks for the kind words, Gerald.

  6. Steve Milan says:

    Chris, sounds like this will be good for you. Congratulations.

  7. Greg Hastings says:

    I’ve been getting your emails, and reading them. And congrats, and best of luck by the way, on your new merger.

  8. Carlene Julian says:

    Congratulations, I have been quite busy. Hope you are doing great. Keep in touch. Good luck with all the new and exciting changes . .. We wish you all the best.

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