The newest finance regulator on the block, the Consumer Financial Protection Bureau, does business very differently than traditional banking regulators, said David Hemmingway, Chief Investment Office of Zions Bancorporation. That’s going to affect entrepreneurs’ ability to get loans, especially at the very earliest stages of their businesses, he said.

Zions is a bank holding company that a bank holding company that owns companies such as California Bank and Trust and Commerce Bank of Oregon, across 10 Western and Southwestern states. And Zions is deeply involved in small-busness lending: Only 20% of its loans go to individuals, with 80% going to businesses and organizations. In 2012, Zions ranked third nationwide in issuance of SBA-backed 504 loans (used to buy property, plant and equipment). Zions was seventh in the SBA’s flagship 7(a) program, and also ranked seventh in Export/Import Bank working capital loans.

When the Office of the Comptroller of the Currency suspects that a bank is in violation of regulations, Hemingway says, it sends the bank a so-called MRA, or Matters Requiring Attention, explaining to the bank what needs to be fixed.

The Consumer Financial Protection Bureau, on the other hand, “is just coming in,” he says. “They bring their attorneys for the exam, and then they levy the fines. If you see the fines they have levied against institutions, they’re not asking questions.”

One of the consequences, says, Hemingway, is that when it comes to consumer business, “The banks are going to do right down the middle, plain vanilla consumer business.” In a short interview after his presentation at the Rocky Mountain Economic Summit, held Friday in Jackson Hole, Wyo., Hemingway said that banks’ reluctance trepidation on the consumer side could very well affect entrepreneurs' abilities to ge their companies off the ground. That’s because many entrepreneurs use consumer loans, based on their own personal credit ratings, to finance the early stages of their businesses.

A positive sign for entrepreneurs?

In general, Hemingway says that business loans are picking up slightly, but says that activity depends greatly on individual states. Texas is very busy, he says, while Nevada remains slow.

Regional and community banks are crucial to small business financing. Despite consolidation in the industry, Hemingway said that regional and community banks were still well-positioned to compete in four particular areas, with small and mid-sized businesses being the first. “Large banks don’t have advantages in those kinds of businesses because it costs them just as much money to build a relationship with the client.” Big banks, he said, have an advantage primarily in areas that can be affected by mass marketing.