How business owners can leverage liquidity strategies for their personal goals

The first step with entrepreneurial clients is to learn about their business and their unique personal financial situation, Hass says. Liquidity solutions may include choosing how long to lock up funds in a GIC or investment, or helping tailor credit solutions around their assets including property, insurance and investments. 

Hass notes that when choosing the appropriate lending solution, CIBC Private Banking advisors look carefully at a client’s cash flow, assets and needs, to find the right fit.

“The entrepreneurial mindset is very much about flexibility, the ability to move with the times,” he says. “I think that's what CIBC, as a relationship-based bank, has recognized and made a priority when helping our clients achieve their financial goals.”

Strategic liquidity solutions also help entrepreneurs diversify their risk, Hass notes. For example, they can allow business owners to borrow in order to invest in the stock market, reducing their reliance on a single asset — their company — to achieve long-term financial goals. 

These strategies can also provide a liquidity reserve or a safety net — and some peace of mind — to help business owners “navigate a downturn in their market without jeopardizing their personal needs and goals.”

Hass gives the example of one long-standing client who wanted to buy a cottage in Muskoka, was heavily invested in his own company, and needed a lending facility to meet his personal needs. 

“Because we had a deep understanding of this client and his business, that comfort level allowed us to help him with a lending structure that met his liquidity needs, but also the bank’s risk appetite,” he says. “That was important — the ability to structure the bank around him, and not the other way around.”

Hass gives another example of a client who owned a substantial real estate portfolio across Canada and had recently sold a large property development.

The client wanted to invest those funds in the public markets to diversify risk away from their real estate portfolio. However, they were worried about not having cash available if another big real estate opportunity presented itself.

“We were able to create an investment structure that gave them access to the markets without any downside risk if the markets fell,” Hass says. “And we also gave them the option to borrow fully against the investment if real estate opportunities came up.” 

It was a win-win for the client, he adds. “They diversified their risk, and they had the peace of mind that if there was a big opportunity, CIBC would be prepared to lend against that investment structure so that they could go ahead and do it.”

Hass says he received one of his greatest compliments from the client who told him, “You and your partners across the bank are entrepreneurial.” That comment highlights how important Canadian entrepreneurs are to CIBC. 

“It resonated with me,” he says. “Because entrepreneurs are the foundation of Canada’s success, and we want to be there to support that success.”