The war for loan growth has moved to a new battlefront—instead of pricing, banks are now competing on loan terms.

Barely removed from years of cleaning up credit quality, lenders are conceding terms to borrowers on everything from the length of amortization to waiving cancellation fees. Competition on loan structures has emerged in the central California banking market in the past 45 days, says Robb Hemsath, president and chief executive of the $94 million-asset Security First Bank in Fresno, Calif.

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