Commercial Bankers: Leveraging Turnaround Consultants for Your Clients

Key Takeaways

Turnaround consultants help struggling businesses stabilize, restructure, and return to profitability.
Commercial bankers benefit by strengthening relationships and reducing risk when recommending turnaround professionals to borrowers.
A borrower’s willingness to engage a turnaround consultant demonstrates commitment to survival and growth.
Strategic referrals can protect the bank in troubled credit situations and even support smoother exits.
Building a network of trusted turnaround professionals should be part of every banker’s toolkit.

Commercial Bankers: Using Turnaround Consultants Strategically

In commercial lending, even strong businesses can encounter unexpected financial turbulence. When a borrower begins to show signs of distress (declining cash flow, mounting debt, or missed projections), commercial bankers are often asked for advice on next steps.

One of the most effective, yet often underutilized, solutions is the strategic use of turnaround consultants. By recommending an experienced turnaround professional, bankers can help clients regain stability while simultaneously protecting the bank’s position.

Why Turnaround Consultants Matter

A turnaround consultant specializes in stabilizing distressed businesses, identifying root problems, and implementing actionable strategies to restore profitability. Their expertise often covers:

Operational restructuring.
Cash flow management.
Debt renegotiation.
Expense reduction and efficiency improvement.
Strategic repositioning for long-term viability.

For bankers, the value lies not only in the consultant’s ability to revive the borrower’s business, but also in the signal it sends: a client willing to hire turnaround help is serious about fixing issues rather than ignoring them.

Strengthening the Borrower-Banker Relationship

When a borrower proactively engages a turnaround consultant, it communicates commitment, accountability, and resilience. As a banker, supporting that decision strengthens the relationship by showing you are more than just a lender; you are a trusted advisor invested in their success.

This can lead to:

Improved borrower performance: reducing risk on your loan portfolio.
Greater loyalty: as clients see you as a problem-solver, not just a creditor.
Enhanced credibility: because you provided actionable, expert-driven solutions.

Strategic Use During Exit Situations

Not every borrower relationship can be saved. Sometimes, a bank may need to transition a client to another lender. In these cases, a turnaround consultant can still play a critical role.

Adds credibility for new lenders: Highlighting that the borrower has engaged professional turnaround help shows that problems are being addressed.
Facilitates a smoother exit: Even in a difficult scenario, consultants can stabilize operations and prepare businesses for transition.
Protects repayment: By ensuring issues are managed, the bank increases the likelihood of being fully paid off.

This approach demonstrates goodwill and responsibility, even when a deal is challenging.

Building Your Turnaround Consultant Network

Every commercial banker should have a roster of trusted turnaround professionals across different industries. Businesses face diverse challenges, from supply chain breakdowns to mismanaged growth, and having access to specialists makes your recommendations stronger and more relevant.

Key steps include:

Establishing relationships with consultants who have a proven track record.
Understanding their specialties (manufacturing, distribution, retail, tech, etc.).
Creating a referral framework so borrowers can engage consultants quickly when needed.

This proactive preparation positions you as a banker with solutions, not just capital.

A Win-Win for Bankers, Borrowers, and the Future

When used strategically, turnaround consultants create value for everyone involved:

Borrowers regain financial stability and improve long-term sustainability.
Banks reduce risk exposure, protect repayment, and strengthen client relationships.
New lenders gain confidence in clients who transition out of your portfolio.

In short, recommending turnaround consultants is not only smart risk management but also a powerful tool for relationship building and long-term pipeline development.

Final Thoughts

For commercial bankers, navigating borrower distress is never easy. But recommending a turnaround consultant, whether to stabilize a troubled company or to prepare for a transition, can be the difference between a failed loan and a successful outcome.

By building a trusted network of turnaround professionals, bankers demonstrate leadership, safeguard their portfolios, and create lasting value for clients. In today’s unpredictable business climate, turnaround consultants aren’t just a lifeline for borrowers—they’re a strategic advantage for bankers.

About Celtic Capital
Companies looking for working capital to cover operating expenses, fund growth, increase buying power, and take advantage of vendor discounts and rebates turn to Celtic Capital. With an appetite for more complex transactions, Celtic Capital has a history of success in crafting creative, flexible asset-based financing solutions from $500,000 to $8 million with no financial covenants.

As an independent lender, working with companies nationwide, Celtic Capital is willing and able to alter price and deal structure and expand lines of credit to handle its clients’ increased revenues; and when cash flow is an issue, will look toward providing an inventory facility to help offset lost cash flow.

If you know of, or are, a business in need of non-traditional financing, contact Mark Hafner at 800.742.0733 or mhafner@celticcapital.com, or visit us at celticcapital.com.