RAWSON BAKER ADVISORS

UNE Smart Region Incubator, Level 2, 24 Fitzroy St, Tamworth NSW 2340

©2018 RAWSON BAKER ADVISORS

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  • Simon Groth

Banking Health Check

Updated: Mar 1, 2019



Small businesses and agribusinesses often 'set and forget' when it comes to banking, especially in relation to core debt. This is not always a problem and loyalty to one bank or another can be due to exceptional service, be long standing and even an emotional decision. Being a long standing or loyal bank customer, however, does not mean you will be always getting the best deal or level of service from your bank.

In fact, this could result in somewhat the opposite occurring; whereby banks may take advantage of this loyalty and maintain an interest rate at a level where their margins are 'fat' as the bank's cost of obtaining finance decreases.

In the current environment interest rates are at record lows, with the Reserve Bank leaving the cash rate unchanged at a record low of 1.5% at their April 2018 meeting. Not suggesting that this correlates directly into record low business lending rates, however if your rate has not been reviewed in the past couple of years it is well worth looking into.

ICR, LVR, Equity Ratio...what the!?!

These are ratios and calculations that the bank's credit team may use to evaluate the level of risk associated with your business and subsequently how to price your borrowing as a result of this.

Our Banking Health Check is one of the tools in our suite of Advisory Services that can help you monitor these ratios.


Having a basic understanding of these indicators and tracking them in your business can ensure that you can have a conversation with your bank around interest rates and be equipped with some data when negotiating interest rates.

Depending on your level of core debt, over the lifetime of a business loan this could save you hundreds or even thousands of dollars.

If you would like more information on a banking health check for your business, or any other services that provide insight, please contact one of our advisors.

Simon Groth 0418 617 038 or email

Andy Chambers 0421 654 674 email