The commercial loan officer is fading into the sunset.

What was once considered the quintessential banking job is no longer the surest route to the top, and for many it has been an exit route.

As commercial banks broaden their scope beyond lending and deposit- taking, the commercial credit competency vies for attention and resources with marketing, operations and technology, and higher-level corporate finance.

With the rise of automation, tasks once handled by a loan officer-such as evaluating an applicant's creditworthiness-are increasingly computerized.

The more adaptable lending officers have gone with the flow, transforming themselves into "relationship managers" or full-purpose "credit officers" who can sell a private placement or a dozen other corporate services to a midsize business as easily as a term loan.

Sadly, others have left the business or lost their jobs, unable to meet changing demands.

"Can you just be a commercial lender like you used to be?" asked Robert D. Fazzini, president of the commercial loan office of First Busey Corp., of Urbana, Ill. "The answer is yes, but you will be the old guy sitting in the corner."

Though no figures are available, bankers and executives in human resources firms say that over the past decade many bankers whose specialty was selling loans have been laid off or have left the industry.

Still others chose to leave large banks for community banks or savings and loans associations, where basic lending skills are still valued.

"It's a sad story," said J. Gregory Coleman, an executive recruiter in the financial services practice of Korn/Ferry International.

They "have either expanded their skills or they have gone into oblivion."

Robert Falese, executive vice president and senior lending officer of Commerce Bancorp, Cherry Hill, N.J., said he has interviewed many displaced loan officers for jobs at his bank.

More often that not, they lack the broad product knowledge needed in today's environment.

"These people were effective in their old roles, but they haven't made the transition," Mr. Falese said.

He said making the transition means "learning that making a line of credit for a customer isn't the only way to help them.... There are cash management products, there are investment products."

Larger banks, particularly money-center institutions, have been preaching this the longest.

Elizabeth E. Bennett, a Chase Manhattan Corp. senior vice president who oversees middle-market relationships on the East Side of Manhattan, said her team of "relationship managers" is responsible for selling more than 100 products, from deposits to derivatives.

"It's not the job of my staff to figure out the terms of an interest rate swap for a client," she said. "It is their job to talk generally about all of the products and make the introductions to the right specialists."

For the new breed of corporate banking officer, it is also important to embrace technology.

Bill Browning, director of the American Bankers Association's Center for Bank Training, said banks are arming their sales forces with laptops loaded with everything from loan applications to credit analysis and financial planning software.

"Now you have to be a great seller, and you have to operate technology that other people used to operate in the back office," he said.

For those willing to take on the added responsibilities, a career as full-purpose relationship manager can be rewarding.

Mr. Fazzini left a job as a chief executive officer of a community bank to head commercial loans at First Busey in Illinois.

Though he still extends term loans, he also helps clients place loans in the secondary market and arranges mezzanine financing for private companies.

"I get to pursue whatever is new and sexy," he said.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.