Commercial lending in Alaska: banks and credit unions eager to make loans.

• Author: Barbour, Tracy
• Position: FINANCIAL SERVICES

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Despite economic uncertainty among some Alaskans, the state's financial institutions claim to have ample resources and are intent on finding qualified borrowers. Contrary to popular belief, there's no scarcity of money available for business financing in Alaska, according to Len Horst, senior vice president and commercial loan manager with Northrim Bank. While there is considerable controversy over the structure of Alaska oil taxes, which generate up to 90 percent of state revenue, the Alaska economy is stable and strong, says Horst, who also serves on the board of the Resource Development Council, a statewide, multi-industry association that promotes the responsible development of Alaska resources.

"We have a good diversification of projects going on," Horst says. "The mining sector has multitudes of money being invested. Fisheries have a positive outlook. Military spending is up. All those factors come together to make it more of a stable economy than the rest of the country."

Consequently, Alaska's financial institutions say they have plenty of money available to help businesses start, expand, purchase equipment or meet their working capital needs, according to Horst. "We all have money to lend," he said, "and we all are looking for those deals."

Northrim Bank provides personal and business banking services through locations in Anchorage, Eagle River, Wasilla and Fairbanks, Alaska; and includes an asset-based lending division in Washington. "We are a strong bank and we are well capitalized," Horst said.

WANTED: BORROWERS

First National Bank Alaska painted a similar picture about Alaska's credit market. Senior Vice President and General Counsel David Lawer said: "We don't believe that the market for credit has tightened. There are fewer commercial loans being made, but it's not because we are changing our credit standards. It's a function of what is going on with the economy."

For example, there are fewer people buying houses, so fewer builders are borrowing because there's a lower demand for what they are producing. "We're fighting for borrowers," Lawer said.

Senior Vice President Corporate Lending, Bill Inscho says First National has more than enough capital to fund loans for Alaska businesses. "We have the resources and we are anxious to lend," he added.

According to Lawer, First National does more than 1,000 commercial loans annually. It has a total loan portfolio of approximately $1.1 billion, more than a $1...