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Cascade Business News asked local banking professionals to share their thoughts, here is what they had to say.
Cory Allen, SVP
Team Leader // Central Oregon
Washington Trust Bank
watrust.com
How are banks helping consumers and small business owners navigate market volatility and external factors that directly impact their finances?
We’re stressing to our clients that volatility in markets is normal. Thus, maintaining a long-term view and staying focused on long-term goals is key. For consumers and small businesses, it’s also important to remember that investment markets aren’t the economy. The economy of an individual or household, or that of a small business, is a much different thing than a stock market index. Take a look at your own situation or that of your business and believe what you are seeing. Don’t get sucked into all the noise (news, social media, etc.).
This isn’t to say consumers and businesses aren’t staring at some real challenges, such as out-of-reach home prices or tariffs disrupting supply chains. But markets, economies, and businesses operate in cycles. Also, keep in mind that while stock markets may be experiencing volatility, hard numbers impacting consumers are looking good — egg prices are way down and as of March, year-over-year CPI (inflation) is nearly at pre-Covid levels (2.8 percent). If the stock market is being used as a gauge, take solace: since World War II, S&P 500 bear markets have on average lasted 11 months while bull markets have lasted four years and four months.
Taking that long-term view, we’re working with our clients to diversify, rebalance, and seek opportunities.
What trends are you seeing in terms of business investment and how do you think these trends will evolve over the next 6 to 12 months?
With Central Oregon’s continued GDP, population growth, and diversified economy in tech, tourism, and manufacturing, business investment should continue, but expectations should be tempered. Oregon’s high business taxes, regulatory complexity, and land-use restrictions will continue to serve as a headwind. Tariff exposure could also impact manufacturing (ex. Outdoor gear makers) and agriculture industries, slowing investment. Over the next year, businesses that capitalize on Central Oregon’s strengths — natural beauty, tech ecosystem, and community vibe — will outperform, but tariffs, taxes, and land constraints could strain smaller firms.
How are changes in interest rates or potential monetary policy changes impacting lending activity and borrower behaviors?
After not cutting rates in March, the general consensus is that the Fed will make two cuts in what remains of 2025. This would bring the target rate to 3.75-4 percent by Q4. Since the action of the Fed impacts short-term rates (such as variable-rate business loans) directly, we’re seeing mixed commercial loan activity. We continue to see interest in new projects for investors and activity, but the cost-benefit analysis can be challenging given current market.
Local businesses continue to have needs that require capital expenditures, but finding affordable real estate or large purchases are weighed heavily against the current uncertainty in the market. The good news is that nationally and locally, our economy still seems to be doing well. The sky is not falling, and consumers continue to spend and feel relatively confident in the economy, although we are seeing deterioration in this sentiment.
We have seen an uptick in general for loans. However, this seems less driven by rates coming down as the fact that the market has accepted and adjusted to the new rate environment. That is, borrowers realize that 3 to 4 percent rates are not in the foreseeable future and that the current cost to borrow is likely the new reality for the foreseeable future.
Meanwhile, HELOC and home equity rates have seen a slow but steady decline. With high housing costs and mortgage rates sticking in the high 6 percent range, coupled with low inventory, some homeowners are opting for renovations over relocating.
How would you describe the balance between supply and demand in the labor market in your region?
As of February, the unemployment rate in Deschutes County sits at 5.2 percent, a noticeable uptick from 3.6 percent in October 2024. Over that same period, Crook County moved from 4.7 to 6.5 percent and Jefferson County 4.1 to 5.8. While a rise in the unemployment rate isn’t generally a good thing, in a tight labor market it can free up workers for higher demand roles, such as health care.
Civilian labor force, which includes those 16 and older who aren’t students, retired, or taking care of children, continues to steadily rise. This is an encouraging sign on the supply side of our labor market.
Over the last year the Bend-Redmond Metropolitan Statistical Area (MSA) saw almost all of its job growth occur in education, health services, and government. Since education and health services include substantial government involvement and funding, most of the new jobs were driven by the public sector. Even though this mirrors what happened at the state level, this is a trend to monitor. Even without cuts to federal agency budgets and employment, having a regional economy’s job growth predominately driven by the public sector isn’t healthy long term.
Are you seeing tariffs affect any local businesses through trade or business expansion plans?
We continue to hear “we just don’t know yet,” but the concerns remain persistent. Many businesses are still in a holding pattern but are expecting higher prices on at least some part of their supply chain. The end result and effect seem to remain in limbo and unknown.
From an expansion standpoint, we believe every business should be considering the information available in terms of whether this is a need, want, or desire. With more uncertainty out there, expansion projects that fall under the want or desire categories may make sense to take a “wait and see” approach with all the uncertainty in the broader markets.
Additional Comments?
When it comes to making large financial decisions, the more information the better. Make sure you know your banker and use them as a resource, as well as your other trusted partners. Understanding the impact on your cash reserves/liquidity and working capital are just as important as how any new debt will impact your cashflow.
Wendy McGrane
Vice President // Business Banking Team Manager
US Bank
usbank.com
How are banks helping consumers and small business owners navigate market volatility and external factors that directly impact their finances?
- Consumers and business owners can’t control the market – but that doesn’t mean there aren’t trusted advisers who can help them prepare for moments like these while investing in their future. Everyone, especially business owners, should have a deep bench of expert support, and a banker should be on that bench. It’s easier to be prepared or to be reactive to situations like this when you have a strong relationship with a financial partner. Related to this, if you are holistically looking to make the most of your money, one of the most effective strategies can be to put as much of your balances and financial products with your primary bank. This can result in relationship rates for savings accounts, credit card rewards and lending products.
One of the more recent things we are hearing from clients right now is that they are looking for quick shelter from market volatility and uncertainty for their shorter-term investments. These funds might be in the form of money earmarked for a larger purchase or business investments. We are starting these conversations by determining the business owner’s risk tolerance and when any funds would need to be accessible. From there, there are several attractive ways for consumers and business owners to keep their funds growing, but in a way that is protected from market fluctuations, such as CDs and Money Market Accounts.
What trends are you seeing in terms of business investment and how do you think these trends will evolve over the next 6 to 12 months?
Business investments translate into the overall increased health, long-term stability and growth of a business. Businesses are seeking more guidance on how to maximize efficiencies and liquidity, and to minimize fraud. We’re having discussions with businesses to determine how quickly they are receiving funds, and how they can better control their payables to maximize cashflow. Owner-operators continue to need equipment, real estate, and operating capital to support their businesses, and we’re here to help facilitate those needs.
One way we achieve this is through thorough operating cycle reviews. By gaining a deeper understanding of a business’ accounts receivables and payables cycles and aligning with their goals and priorities, we can support our clients with a more comprehensive approach. We’re also introducing new products that help cut expenses and improve efficiency. For example, U.S. Bank Business Essentials is an all-in-one one checking account combined with payments acceptance capabilities for small businesses. Another innovation is U.S. Bank Spend Management, a platform that allows businesses to monitor, track, and control their card-based spending.
How are changes in interest rates or potential monetary policy changes impacting lending activity and borrower behaviors?
We’re noticing that borrowers are not looking to lock in interest rates for as long as they used to, as many borrowers believe that interest rates may decline during the course of their loan terms. The needs of owner-operators have not changed, so they are continuing to proceed with financing to support their businesses. They are just doing so with the understanding that the market is apt to fluctuate on a day-to-day, week-to-week basis.
How would you describe the balance between supply and demand in the labor market in your region?
There are strong expectations that unemployment will continue to remain low in Central Oregon, while some industries will continue to face challenges with finding the skilled workers they need. Central Oregon is an attractive location to live, work and play, and quality of life is a consistent factor in driving people to the region. On the other hand, the rising cost of housing is a hindrance that prevents businesses from recruiting the skilled talent they need to expand.
Are you seeing tariffs affect any local businesses through trade or business expansion plans?
Tariffs are a common discussion topic between most businesses and our bankers. Many businesses are re-evaluating their supply chain to determine if steps can be taken to minimize increased costs, such as considering switching to suppliers in countries with lower tariffs. We’re hearing that some businesses have stockpiled inventory in anticipation of increased costs, and in turn may have less liquidity than they are used to or have borrowed more against their credit lines.
It’s been difficult for many businesses to forecast their projections based on the rapid changes in supply chain costs, and when to increase prices for their customers. We are doing our best to stay close to our clients and understand their challenges to find the right solutions. Through it all, we’re encouraged that business owners are resilient through their resourcefulness and creativity when facing adversity.
Gary O’Connell, EVP
Market President
Summit Bank
sbko.bank
How are banks helping consumers and small business owners navigate market volatility and external factors that directly impact their finances?
As Summit Bank is focused on the small to medium sized business segment, we frequently have candid discussions with business owners about what the near-term future holds. It is uncertain and at times inconclusive, but the process of vetting opportunities against external market dynamics is a healthy one and business owners appreciate the chance to lean on trusted partners in times like these. We have not changed our loan policy, which we feel provides a measure of stability and confidence. Local economic activity is measurably slower than in the recent past, but we also observe that businesses are making more deliberate and thoughtful capital and treasury management decisions in this environment given the perceived volatility. In summary, there is an increased level of collaboration between business owners and their circle of advisors, at which our bankers often have a seat the table.
What trends are you seeing in terms of business investment and how do you think these trends will evolve over the next 6 to 12 months?
Related to the above response, we have seen a few capital investment decisions postponed or put on the shelf until there is a greater sense of certainty. The trend, or hope, that many business owners seek in 2025 is a lower business tax environment and lower interest rates. The tariff discussion is the obvious cloud hanging over our heads, but there are varying levels of optimism that those concerns will be put behind us later in 2025.
How are changes in interest rates or potential monetary policy changes impacting lending activity and borrower behaviors.
The last couple of years have been an adjustment period for business owners. As recently as last year, many owners were still shocked at the higher cost of capital when borrowing. Conversely, many adjusted their balance sheets over the last few years by accumulating funds, partly due to a higher yielding environment for business savings but also to build reserves to safeguard against market volatility. Fast forward to today, and a common sentiment is that the current rate environment is the new normal. With the Prime borrowing rate hovering at 7.50% and long term treasury yields in the high 3’s, we are actually closer to historical norms than the low rate environment we experienced prior to 2023. Expectations about rate movements this year and beyond are mixed between bearish and bullish. As an economist who works with our bank often quips, we are like a baserunner in baseball leading off first base and trying to decide whether to steal second base or not get picked off first. As this relates to lending activity, we are seeing higher thresholds for success than before for capital investment projects. Business lending remains steady but we probably wouldn’t describe it as robust. Businesses, on the whole, remains very thoughtful about borrowing and they have a greater aversion to risk because of market factors not in their control. All that said, we work with very successful businesses that have found a way to adapt and stimulate growth in light of economic uncertainty. We often talk about who may be adversely impacted in times of disruption, but we also want to recognize the many businesses capitalizing and finding new ways to succeed. When Summit Bank plays a part in the growth and success of a business resulting in other community benefits such as economic growth and job creation, it is not only enjoyable but validates our sense of purpose. Doing this in turbulent times is even more difficult but we feel it is also the hallmark of a local community bank.
How would you describe the balance between supply and demand in the labor market in your region?
Compared to 3-5 years ago, the labor market has shifted dramatically in favor of employers in most of the industry sectors we serve such as manufacturing, fabricating, professional services, contractors and non-profits. Yet, we continue to hear about contradictory symptoms of greater workforce availability countered by businesses not able to fill jobs with the right fit or skillsets. While our primary role is to serve as a local community business bank, we find ourselves at the center of many conversations with businesses and job applicants seeking to fill and obtain positions. We are mindful always of business and individual confidentiality but, when sought out and given permission, we make introductions between employers and the workforce.
Are you seeing tariffs affect any local businesses through trade or business expansion plans?
Yes. We see business decision makers responding to both actual tariffs and expectations and perceptions about tariffs that haven’t yet funneled through various industry channels. For instance, we certainly see tariffs priced in to deep or long cycle sales functions such as construction bidding to the extent that imported materials are involved. This may result in higher material cost quotes and higher budgeted cost contingencies. In other cases, we have observed a few businesses loading up on inventory in advance of tariff expectations. We have hundreds of business lines of credit out to the local business community. Lines of credit are often used, in part, to finance inventory. As such, we monitor what we call line of credit utilization reports, which is the level to which a business borrower draws on their credit line compared to the total availability on their line. Surprisingly, we have not experienced a material increase in credit line utilization among our business base. One possible explanation is that many businesses may first be relying on the aforementioned business reserves (increase in business cash savings) that have been increasing over the last three plus years. We have certainly seen this with recent increases in Summit Bank Business Savings and Checking accounts with unlimited FDIC insurance. Another recent trend we have experienced – and this may be more attributable to overall uncertainty than just tariffs – is an uptick in merger and acquisition activity (M&A). There are heighted levels of M&A discussions with our bankers not only locally but across our markets throughout Oregon. M&A financing is a substantial component of our overall lending activity.
Additional Comments?
It may sound cliché, but if you are a business decision maker please talk to a local Summit Banker or your financial contact to share your thoughts, solicit input, and perhaps even vent a little bit. We have local offices in Redmond and in Bend, and we also travel to the offices of our business base every day. We are here to listen and be a confidential sounding board. Often times a business will share a business challenge and we can feel their burden and stress. However, in many cases it is a challenge we have heard about before from other business who have successfully navigated through them. It is healthy to air out ideas and concerns. Further, our bankers have mountains of data that we are happy to share including industry metrics and KPI’s on almost every type of industry segment. For instance, median and mean working capital levels, levels of leverage (debt to equity), cash flow margins, business valuation cash flow multiples, and many more.
Chris DuPont, SVP
Commercial Banking Market Manager // Central Oregon Commercial Banking
Umpqua Bank
umpquabank.com
How are banks helping consumers and small business owners navigate market volatility and external factors that directly impact their finances?
Banks are actively supporting consumers and small business owners in navigating market volatility and external financial challenges through a combination of financial tools, advisory services, and educational initiatives.
For Consumers:
- Personalized Financial Guidance: Banks use data analytics to offer tailored advice to help consumers make informed decisions.
- Emotional Support: Financial institutions help clients stay calm during market fluctuations and focus on long-term strategies.
- Financial Resources: Access to flexible credit options and lending products supports consumers during uncertain times.
For Small Business Owners:
- Customized Lending Solutions: Offerings such as SBA loans and revolving credit lines support cash flow and growth.
- Strategic Partnerships: Banks work closely with innovative companies to provide capital and business guidance.
- Financial Education: Institutions offer tools and resources to help business owners improve financial literacy and resilience.
We take the approach of relationship banking. Our bankers are geared toward working directly with our customers to understand their business models, industry challenges and future goals. From there we custom tailor their financial products and services to meet their needs and advocate for them as needed.
What trends are you seeing in terms of business involvement and how do you think these trends will evolve over the next 6 to 12 months?
Business expansion and growth have been hindered by elevated interest rates, rising costs of goods and materials, and increased operational expenses (including higher wages). This environment has led many businesses to tighten fiscal policies, with some owners retiring early or exiting their industries. With continued economic uncertainty, many businesses are reaching a point where waiting for market corrections is no longer feasible and need to expand their business or make structural changes. We anticipate strategic moves as companies look for ways to adapt, restructure, or become more efficient. Over the next 6 to 12 months, expect to see a cautious approach, particularly in areas involving international trade, as businesses focus on sustainability and risk mitigation.
How are changes in interest rates or potential monetary policy changes impacting lending activity and borrower behaviors?
Lending activity has slowed significantly over the past 18 to 24 months due to elevated interest rates. For businesses, borrowing costs have increased, particularly when using operating lines to manage cash flow, causing many to delay investments and reassess financial plans. Cost of acquisition has skyrocketed and when coupled with high interest rates, expansion or relocation becomes difficult. Central Oregon has enjoyed continual growth even through these slower economic times and there is still plenty of opportunity out there. It is just taking a more strategic approach to reach the borrowers’ goals.
On the consumer side, mortgage rates have surged, contributing to a slowdown in the housing market. High home prices combined with rising rates have made homeownership less affordable, leading many to pause home buying or selling decisions and evaporating the refinance opportunities.
Borrowers are cautious and focusing on maintaining liquidity and managing debt prudently amid ongoing monetary policy uncertainty.
How would you describe the balance between supply and demand in the labor market in your region?
Coming out of the pandemic, many businesses have struggled to bring workers back, resulting in operational disruptions. While consumer demand has rebounded, matching that demand with adequate staffing has proven difficult. Though there’s been some improvement, nearly every industry has faced labor shortages.
Most recently, some companies have begun scaling back due to shifting market conditions, aiming to improve efficiency and offset rising costs. The labor market remains fragile, with businesses balancing workforce rebuilding efforts against broader economic uncertainties.
Are you seeing tariffs affect any local businesses through trade or business expansion plans?
Yes, we’ve seen some disruptions, especially in Q1, among businesses reliant on foreign markets. Inventories have built up and distribution-particularly to Canada-has slowed due to concerns about cost impacts from tariffs. Our agriculture-focused economy has long felt the effects of foreign trade policy, with commodity prices remaining low for well over a year. The impact of Tariff’s carries with it a large unknown factor in how that will ultimately impact business owner margins. We are confident that business owners and managers will navigate these challenges similar to how they manage their tax obligations. Careful watch over the macroeconomy is going to be important and becoming a student of their specific industry is paramount to navigate the future ahead.
Business owners are increasingly monitoring trade developments and becoming more informed, but ongoing uncertainty has led many to pause expansion plans and adopt a ‘wait and see’ approach. We are too early in the process to fully understand the impacts that will be faced during these times.
Additional Comments?
It is important for business owners to maintain good relationships with their bankers and it is equally important for bankers to work with their customers and understand their needs. Working together is going to be the key to moving forward in these uncertain times and proactively plan and execute on those plans. It’s good practice to continue to review business plans, work with CPA’s and accountants and pay attention to markets and industries.
Kevin Cole
President // CEO
Mid Oregon Credit Union
midoregon.com
How are banks credit unions helping consumers and small business owners navigate market volatility and external factors that directly impact their finances?
Your financial institution can be a source of advice and information during times of volatility, whether that volatility is market or policy driven or both, as is the case now. The past few months serve as a reminder to both individuals and businesses that being prepared is an excellent complement to effective planning.
There is no single piece of advice, as each person’s situation is unique. Some businesses may find opportunities amid the current policy-driven turmoil, provided they are prepared to seize those opportunities.
The primary role of financial institutions in the economy is to provide capital to businesses and consumers, regardless of economic conditions. At Mid Oregon Credit Union, we continue to see strong demand for loans. We are working hard to ensure we have the funding necessary to meet this loan demand. Additionally, rates on deposits remain attractive, and depositing funds at Mid Oregon can add both stability and yield to a financial portfolio.
What trends are you seeing in terms of business investment and how do you think these trends will evolve over the next 6 to 12 months?
The landscape of commercial construction in Central Oregon remains sluggish, despite the many projects that are currently being built. The slowdown is particularly evident in the number of projects in the planning phase. High construction costs, financing rates, and increased local government fees are making many potentially viable projects simply unaffordable.
Recently, we’ve seen unemployment in Oregon soar to a three-year high. This is a clear indication that our current employment (or unemployment) situation is a lagging indicator of policy choices made in the past few years. The harmful state-level decisions impacting our business climate are not showing any signs of abating.
Without a change in direction, Oregon can expect to see continued declines in population growth, business formation, and ultimately, employment.
How are changes in interest rates or potential monetary policy changes impacting lending activity and borrower behaviors.
Consumers and businesses have adjusted to the challenges of higher interest rates. Consumers continue to borrow to buy cars and tap into home equity.
Mid Oregon continues to see a lot of borrowers opting for home equity loans to upgrade their living spaces. This was expected given that a substantial number of homeowners benefit from mortgages with rates of 4 percent or lower. The cost of moving to a new home with current mortgage rates and real estate prices is too painful, so people are choosing to invest in their existing homes and staying put.
Like other markets, interest rates are volatile right — with competing forces pushing rates both up and down. For example, slowing economic activity would normally indicate lower rates in the future. Tariffs, on the other hand, will add to inflationary pressures. Until there is more policy certainty, rates will be volatile in the short term and unlikely to shift significantly in the long run.
How would you describe the balance between supply and demand in the labor market in your region?
We proudly operate in Deschutes, Jefferson, and Crook Counties. We continue to see a strong pool of applicants for our open positions, and employee turnover has significantly decreased since 2021 and 2022. Typically, we do not lose employees to other employers in Central Oregon; instead, they tend to leave for other states or regions in Oregon that offer a lower cost of living.
At Mid Oregon Credit Union, we are proud to have been recognized three times as a Top Workplace, reinforcing our commitment to being an exceptional place to work. This reputation helps us attract, develop, and retain top talent in Central Oregon.
Are you seeing tariffs affect any local businesses through trade or business expansion plans?
We have not seen any specific examples in our portfolio. We expect the tariffs to impact on our auto lending business, construction costs, and the cost of steel and aluminum. We have clients that will experience impact from the current tariff policy, but many of them prepared and acquired materials ahead of the tariffs.
Additional Comments?
Doing business with a local financial institution matters to our local economy. The deposits you keep at Mid Oregon are loaned out to support consumer spending and business investments throughout the Tri-County area.
During periods of financial volatility, we commonly see a reduction in lending by financial institutions. However, thanks to the support and loyalty that Mid Oregon has earned from our members and the businesses we partner with, we can continue to provide credit that supports local economic activity here in Central Oregon, regardless of market fluctuations or economic uncertainty.
Michelle Loftsgard, AVP
Area Manager // Central Oregon
OnPoint Community Credit Union
onpointcu.com
How are banks helping consumers and small business owners navigate market volatility and external factors that directly impact their finances?
Financial institutions like banks and credit unions provide options and products for consumers and business owners to navigate volatile economic periods, including loans, lines of credit, and investment advice.
At OnPoint, education is a cornerstone of our member service, and in addition to our full suite of financial services, we provide free tools, tips and resources to help our members and community increase their financial knowledge and well-being.
What trends are you seeing in terms of business investment and how do you think these trends will evolve over the next 6 to 12 months?
Acknowledging that the trends we see at this moment may not be indicative of larger trends, we have seen a steady increase into small business investment as an organization.
Projecting the next 6-12 months seems uncertain right now, but we anticipate that the trend of growth will continue as our primary business members continue to explore entrepreneurship.
How are changes in interest rates or potential monetary policy changes impacting lending activity and borrower behaviors?
Any changes to the prime rate will have an effect on businesses, but the state of the economy at large will likely be the main driver of borrower behavior. Consumer spending habits drive business borrowing, so the average consumer’s ability to afford the goods and services of our business members is most likely to be the driving factor.
How would you describe the balance between supply and demand in the labor market in your region?
One of the biggest challenges around candidate supply in Bend, especially for entry-level roles, is the cost of living — many potential candidates simply can’t afford to live here. This creates a difficult balance: the further people have to commute from surrounding areas, the less appealing the compensation becomes, which naturally reduces the pool of applicants. The rise of remote work during the COVID-19 pandemic has also posed a challenge to finding individuals willing to return to in-person roles.
Are you seeing tariffs affect any local businesses through trade or business expansion plans?
Some businesses have reached out with the hope of taking advantage of pre-tariff purchases of vehicles, goods, and raw materials. However, the majority of the businesses we serve are not directly affected by tariffs — but will likely be hit by the effects felt further downstream.
