Bank chief hails Scots’ firms response to Covid fall-out

But for Fraser Sime, regional director for small and medium-sized enterprises and mid-corporates at Bank of Scotland, the response of the business community to the existential threat has been inspirational.

“Clients, in general, have been incredibly resilient, given how challenging the pandemic has been,” said Mr Sime, who heads a 50-strong team that looks after Scottish companies in the £3 million to £100m turnover category. “That’s probably the most pleasing thing I have seen in the last 18 months.”

Mr Sime, who has spent nearly 25 years in commercial banking, hailed the “entrepreneurial spirit” many SMEs in Scotland have displayed over the last year and a half. That was evident at the manufacturers which moved swiftly into the production of hand sanitisers, and restaurants which entered the home delivery market.

“I’ve got thousands of clients to look after [and of] those that I have had the pleasure to talk to recently, it’s [been] really uplifting just to hear how creative, how determined, how entrepreneurial they are, no matter what is thrown in their way,” Mr Sime added. “They are really, really determined to make the best of what is in front of them.”

Mr Sime believes the health of Scottish businesses now is “better than could have been expected six or nine months ago”.

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Asked if he was concerned about the impact that the withdrawal of support such as furlough could have, Mr Sime observed that owners began to get used to life without safety nets six months ago, when they faced the first repayments for emergency loans taken out early in the pandemic.

The contribution that companies have been required to make under furlough has also been increasing as the support provided by government under the scheme has tapered off.

The response of businesses has been to adjust their operations and cost bases accordingly, Mr Sime noted.

“If you’d asked me six months ago, if I thought we’d be in this position today with the vast majority of clients able to cope with these changes, then I would have been really, really pleased,” he said.

“Clearly there are still some other things to go. Furlough does end shortly, but there are far less people on furlough than there were at the beginning of the pandemic.”

Many companies rushed to take out CBILS (coronavirus business interruption loan scheme) and bounce back loans from banks when the economic outlook was so unclear.

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Banks such as Lloyds, owner of Bank of Scotland, and NatWest owner Royal Bank of Scotland, stepped in to provide billions of pounds’ worth of those facilities, which have been heavily underwritten by the UK Government.

Mr Sime said some clients took out such loans as a “form of insurance” given how uncertain the future looked a year and a half ago.

Today, he noted, the “vast majority” have repaid the loans, while others have taken on a “pay as you grow” option.

“It’s early days, but it is quite encouraging,” Mr Sime said.

Deep challenges remain across the economy, however, as can be seen in sectors facing staff shortages, supply chain disruption and, increasingly, worries over gas prices and fuel supplies.

Asked to sum up the outlook, Mr Sime said: “We are encouraged by the economic backdrop, but there are certainly challenges that still need to be addressed,” Mr Sime said.

“We just need to make sure we are listening to our clients, working with them and giving them support as best as we can.”

He added: “I’m encouraged by most sectors… even sectors you would ordinarily expect challenges. Aspects of hospitality, for example, have been challenged through lockdown, but the clients who have adapted their business model to try and not just do the face-face [service] and do a home delivery service (have impressed). It’s incredible how sectors where you would expect to have seen more challenges have adapted to try and survive and ultimately thrive.”

Mr Sime added: “I think there are a lot of really positive soundings going on in property development and the housebuilding sector.”

Mr Sime has been with Bank of Scotland for 24 years, and has held his current role for nearly five. He joined from Ernst & Young, where he trained as a chartered accountant, and made the switch when an opportunity arose after he had worked on the audit of the bank for four years. His initial role at Bank of Scotland was in acquisition finance.

Asked what he finds enjoyable about his current role, he highlighted the variety of the work and how quickly it can change from year to year. He is also very interested in helping team members develop their careers within the bank.

Mr Sime said he has still to meet Charlie Nunn, the chief executive of Bank of Scotland owner Lloyds Banking Group, who recently took over from Antonio Horta-Osorio, but it is on the agenda.

“He’s obviously really keen to get out and about and meet clients and meet the team,” Mr Sime said. “I’m hoping that is going to happen later on this year.”

Six Questions:

What countries have you most enjoyed travelling to, for business or leisure, and why?
I have been very fortunate to travel to many countries in Europe with work and also further afield to the US and Australia but you never have enough time to enjoy the cities you visit with work so my go to holiday destination of Portugal comes up trumps as I can relax as soon as I arrive!
 
When you were a child, what was your ideal job? Why did it appeal? 
A few friends took golf very seriously and forged a career in the sport but I knew my limitations early so sadly had to focus on what I was good at instead. I still dream...
 
What was your biggest break in business?
An opportunity to run our acquisition finance business on the continent was my first real leadership job. Being in a different country each week with talented people, growing a business and having fun along the way was pretty special.
 
What was your worst moment in business? 
The most challenging was undoubtedly last year with my team trying everything we could to help as many businesses as possible get the funding they needed but when you look back at the hard work I can be very proud of the team and how they worked tirelessly to deliver for our clients.

Who do you most admire and why?
Not a specific individual as such but Olympic and Paralympic athletes are phenomenal in general and the skills they have translate in many ways to business. Brilliant preparation, team work, hard work, coaching and execution. I am in awe at how far people can push themselves when they put their mind to it!

What book are you reading and what music are you listening to?
Linwood Barclay and the Accident is work in progress – he is a fantastic crime writer and never disappoints.