“Hand Holding” and “Bridging the Gap”


Craig Alexander Rattray was invited to meet the owners of an underperforming hotel by the existing bank.

The company had suffered from the general economic downturn and some internal management issues had severely impacted on performance.


Despite this, the company remained profitable.  However, as a result of embarking on an expansion and refurbishment plan from existing resources, cash flow was severely impacted and the business was struggling to complete the expansion and refurbishment plan at the same time as meeting the ongoing day-to-day cash demands.

Other problems included:

  • the banking relationship had “broken down” and there was significant mistrust on both sides
  • the fixed rate loans were due to move to a base rate linked rate and the bank was unlikely to make a significant return at the rates previously agreed
  • the company had failed to provide adequate historical financial management information, and had not even thought of detailed forecasts or a change in strategy
  • internally, the bank was considering an Independent Business Review and the company was very against this due to the cost and the uncertainty of the outcome


We were appointed by the shareholders of the company and agreed to work with the management team to provide the bank with a range of information including current management accounts, prior year statutory accounts, updated forecasts and a new plan.

As a result of this, we managed to convince the bank that an IBR was unnecessary.

Our role involved:

  • the preparation of an Initial Review report for the bank
  • intensive “hands-on” assistance to company
  • meetings with the bank, and the presentation of a new strategy including all of the information that had been requested

The successful outcome of this resulted in the facilities being renewed and indeed increased, a new agreement on the term loans, and the appointment of a new Relationship Manager.  In summary, everyone was happy, and we were requested to remain involved with the company.

This Case Study highlights the importance of an independent third party view and shows that there is often a perception gap between the bank and its customer when there are pressures on the business.  We were able to clarify the expectations of each side to the other and “hold their hands” through the process to a successful conclusion.


Key outcomes of the role included:

  • Provision of information required by the bank
  • Continued support from the bank and an increase in facilities
  • Strong financial management and revamped financial infrastructure
  • Rebuilt the relationship between the bank and the company