Why structure, not speed, defines real value for SMEs – McDermott

Transactions come and go, but the deals that stand the test of time are those built with care. In a market where speed and volume are celebrated, the idea of patience in lending might sound traditional. Yet, here at LHV Bank, it has become a deliberate choice.

Figures show that gross lending to UK SMEs by the main high street banks climbed 8% in Q2 2025, reaching roughly £4.24bn. At first glance, that looks encouraging. But read between the lines and the story is less about growth and more about direction. The pace is easing, competition is tight, and everyone is watching their margins. Meanwhile, SME borrowing crept from 0.3% to 0.9% in July, the highest since 2021. This is steady progress, though hardly a surge.

Lending is a ‘long game’

What does all this tell us? That the easy wins are long gone. When demand is cautious and capital costs more, the temptation is to chase speed by pushing deals through and swiftly moving on to the next one. However, we find that it is the slower work, the deals that require structuring and careful design, that create lasting value.

Structure in lending isn’t a neat line on a term sheet; it’s the shape of a relationship. It’s the way repayments fit a business’ cash flow, and whether an exit plan feels realistic once the ink dries. The best deals, in my experience, are the ones that still make sense a year later, when rates have moved and the client’s plans have changed course.

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There’s a reason we talk so much about alignment. A facility built to meet a deadline may close quickly, but one built to match a borrower’s wider goals – such as growth, acquisition or consolidation – will perform better over time. The trick is getting that full picture early enough. Brokers who share context upfront make the process smoother for everyone. I don’t think it’s about perfection, but more about clarity. When both sides understand where the business is heading, the structure almost writes itself.

That’s not to say speed doesn’t matter, it certainly does. But speed without structure is short-lived, and the real test of a lender’s process is how well a loan holds together when the market turns. We’ve all seen deals that looked fine on paper until the first repayment wobble exposes a mismatch. Lending built on solid structure tends to hold its shape and doesn’t have to rely on good luck or a forgiving market.

Internally, we measure success a little differently. Of course, completions and turnaround times matter, but so does performance long after completion. How many loans are still behaving exactly as intended a year down the line? How many clients have come back for another round, not because they must, but because the last facility worked as planned? Those are the measures that tell you something about the quality of your structures.

Consistency plays a part too. It’s not glamorous, but it’s powerful. A lender who applies the same discipline in good times and lean ones builds trust faster than any marketing campaign ever could. Brokers remember who handled their cases fairly, and borrowers remember who kept their word. Over time, that reliability becomes a brand in itself.

There’s always more noise around the sector with new entrants, new products and new claims of ‘faster than ever’. But lending, at its core, remains a long game. Structure is the part that holds everything together when the headlines fade away.

So, when I look at those lending figures and hear talk of growth or contraction, I tend to think less about the numbers and more about the shape of the deals behind them. Are we building loans that can last? Are we lending beyond the deal? For us at LHV Bank, that’s the only kind of lending that really counts.