PHIL BOND: This is an ideal time to fix any floating rate debt or make that equipment or real estate purchase

Phil Bond F&M Bank EVP/Chief Credit Officer

F&M Bank Chief Credit Officer offers insight on the current state of commercial lending


Q: What trends do you foresee for commercial lending in 2022?

A: During 2021, we saw that companies were cautious and kept liquidity on the sideline, with lines of credit at very low or zero balances. I expect that during 2022, companies that are doing well will have already used PPP funds and will start wanting to use their lines to expand their business and/or increase
inventory to counter supply chain challenges.

Q: What should companies be doing now to ensure financial success in 2022?

A: To have the right size line for their anticipated growth and ensure that their bank’s financial covenant requirements are not overly restrictive to accomplishing this, companies should be taking a second look at their current line during Q1 2022. Most lines mature in Q2 when year-end financials have been completed and reviewed by their bank, so this is a good time to ensure that what a company has in place is going to work for them.

Additionally, with interest rates expected to rise this year, this is a very opportune time to fix any floating rate debt or make that equipment/real estate purchase that may have been contemplated over the last couple years. It would also be a good time to consider refinancing any term loans that have less than two or three years remaining until maturity.

Q: What is the difference between CRE and C&I?

A: Commercial & Industrial (C&I) lending is any type of loan made to provide either working capital or to finance major capital expenditures, like equipment and inventory. C&I loans are not intended for real property though real estate may be used as collateral.

If you need financing for a property, a Commercial Real Estate (CRE) loan might be the  right choice.  CRE  loans are  typic ally larger, but come with unique challenges based on local economic conditions and the illiquidity of real estate.

Los Angeles County Real Estate Markets Available Space by Property Type YOY Change (Ql ’21-Ql ’22)
Q: Who qualifies for these loans?

A: If you’re a business entity or an investor who is looking to purchase a commercial property, or new equipment or inventory for your business, a commercial loan would be a good financing option.


Q: Does F&M Bank offer commercial loans?

A: The Farmers & Merchants Business Banking Group focuses on lines of credit, equipment loans, acquisition loans, and owner occupied real estate loans from $1 million to $50 million. We take pride in customizing financing solutions for small to medium sized businesses which facilitate an ease of doing business that is uncommon in today’s marketplace.



Phil Bond, Executive Vice President and Chief Credit Officer at Farmers & Merchants Bank, a 115 year old regional bank based in Long Beach. For more information, visit
All loans are subject co credit approval. • NMLS #537388 • Member FDIC


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