Business Plan

An essential element of a business plan is the identification and control of critical threats to the continued viability of a business. Some risks involved with business that are critical go beyond mere competitive threats; they include potential legal liabilities, inadequate cash flow, inadequate personnel and loss of important intellectual property rights. Business must be aware of critical risks and draw up plans to deal with them (Critical Risks, 2003).

Small banks that borrowed federal bailout money are now struggling to repay the government and a growing number could potentially default on their obligations to taxpayers or go out of business. The Congressional Oversight panel reports that fewer than 10% small banks that participated in the bailout have repaid Uncle Sam and that one in seven have missed making dividend payments (Wiseman, 2010).

Commercial banks are in the risk business. In the process of providing financial services, they assume various kinds of financial risks. With the financial crisis that reached its peak in 2008 many banks lost a lot of money when homeowners started foreclosing on their homes, businesses shutting down, and many people losing their jobs. The capital that banks receive from investors to continue on with business started to become limited, therefore many banks filled for bankrupt.

Congress approved a bailout plan to assist banks with their financial troubles. The problem with this bailout was that it was geared towards saving big named banks. Many small banks have struggled to raise private capital to replace bailout funds so they are floundering. Small banks are seen as riskier than megabanks which are considered to be too full-size to fail because they often have modest or no admittance to capital markets (Wiseman, 2010).

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There is a pending bill that will establish a $30 billion small business lending fund that could potentially save small banks. This will be another major financial risk for banks since the...