Howard Applebaum,  Chief Lending Officer,  Sterling National Bank
Howard Applebaum,
Chief Lending Officer,
Sterling National Bank

At press time, New York City-based Sterling National Bank was on track to unite with Provident Bank, also based in New York, during the fourth quarter of 2013. Companies in need of banking and financing solutions, particularly asset-based lending, will have even more options once the merger is complete.

The resulting institution will maintain the Sterling National Bank name, will be a nearly $7 billion bank and fall within the top ten ranking, by total deposits, among regional banks within the combined entity’s footprint. Sterling’s focus on small to mid-sized businesses (SMBs) will remain intact as well, since that is where Sterling and the combined bank wield a competitive advantage. “Both banks have a very high standard of customer service, which is crucial to serving small and medium-sized businesses effectively,” says Sterling’s chief lending officer, Howard Applebaum.

The newly combined bank will have a broader and complementary geographic reach primarily serving clients in New York City, Westchester, Long Island, New Jersey and the counties north and west of New York City and beyond. Applebaum adds, “Our ultimate goal is to offer more products to more customers in more locations, with the same high level of customer service both banks now achieve.”

As these two leading institutions unite, existing and potential customers will begin to see greater opportunities by gaining access to complementary product sets tailored to their needs. “Everything the market has come to expect from Sterling and its deep knowledge in asset-based lending and factoring will be that much better, as it becomes part of a larger organization that keeps its focus on exceptional service and performance,” says Applebaum.

The economic recovery is giving SMBs in the New York metropolitan area a boost of optimism. Since the financial crisis five years ago, many companies with revenues under $100 million have struggled to consistently generate the sales needed to finance growth. But today the demand for goods and services is rising, giving SMBs the opportunity to expand — plus fuel new entrepreneurial activity. The key purpose of Sterling’s ABL and factoring products are to support these very types of events. “Current economic conditions are an ideal environment for asset-based lenders like Sterling National Bank. We can help break a financing logjam that can prevent a perfectly good business from meeting its potential,” Applebaum states. “Sterling’s experienced asset-based lenders and factoring managers can look beyond a borrower’s financials to its management and marketing skills, production facilities and customer base.”

Applebaum notes that Sterling specializes in cultivating collaborative, long-term client relationships that enable it to stay close to each individual borrower’s business and continually analyze their collateral. “The depth of our customer relationships allow us to customize a loan or line of credit to help businesses achieve their short to mid-term goals — whether to provide capital for ongoing operational needs, improvements or expansion, purchase of owner-occupied real estate, acquisitions, buyouts and other needs.”

Applebaum pointed to this as one reason that Sterling, in business since 1929, has one of the longest average customer tenures in the business — 12 years. “This is the sort of relationship banking that large commercial lenders find difficult to maintain over time. As such, Sterling is able to provide financing to this group of borrowers that larger institutions cannot efficiently or effectively serve.”

He adds, “Sterling’s deep understanding of the borrower’s business allows the bank to leverage a customer’s capital by up to 12 times. As a result, when the business increases in asset growth and profitability, Sterling can respond quickly with increasing financing as needed to maintain momentum.”

Applebaum also suggests that different asset-based lending products are appropriate depending on the stages of a company’s development. A start-up might be best served with a factoring solution, because this eliminates some of the work involved in managing accounts receivable. It might then graduate to an asset-based loan tied to receivables or inventory over which it maintains ownership. Over time, as the bank acquires in-depth insight into the company’s business and prospects, it will loosen some of the oversight and detailed disclosure requirements. “All throughout the company’s life cycle,” Applebaum says, “Sterling is able to react quickly to changes in the borrower’s business needs.”

Applebaum believes that 2014 will see a significant re-awakening in the service sector in the New York metropolitan area, a development that Sterling’s asset-based lending business is well positioned to support. “Companies are returning to higher profitability, and with that come thoughts of expansion and acquisition, which we routinely support. This trend is already visible in Sterling’s Payroll Financing Division, which specializes in providing receivables-backed financing to hundreds of temporary staffing agencies so they can meet their payroll obligations. The bank’s payroll financing activity has been markedly increasing — which is often viewed as an indication that more permanent hiring is on the way,” Applebaum notes.

As Sterling completes its planned merger with Provident and the economic recovery continues, its asset-based lending and factoring services are likely to lead the way toward growth and greater profitability, for both Sterling and its customers.

Howard Brod Brownstein, CTP
Howard Brod Brownstein is a Certified Turnaround Professional, the president of The Brownstein Corp. and a contributing editor of ABF Journal. He can be reached at