Three years ago, she was the apple of the Royal Bank’s eye. Petite and photo-genic, Edmonton clothing designer Yvette (like Halston and Mr. Blackwell, she goes by one name at a time) starred in a Royal Bank of Canada advertising campaign, aimed at attracting customers from the small-business sector.

The ad copy stressed Yvette’s determination and courage as an independent businesswomen. Only recently did the bankers find out how well they judged her character.

And with the ad campaign in the making, the sole owner of Yve’s Creations Ltd., 8170 - 50th Street in Edmonton,negotiated the first of two five-year demand loans from her own Royal Bank branch.

Yvette was awash in the glow you get when you do business with a committed friend to the entrepreneur.

As the months rolled by, she never once defaulted on a monthly payment. She never tried to dodge payment schedules.

Al Popil, for Business Edge
Yvette says the Royal Bank's "dedication" to women entrepreneurs may include an early cutoff.

And her bankers acknowledged these points in writing last October, when they abruptly pulled the plug on their poster girl.

In a note requesting payout of an operating loan balance of $18,000, plus a term-loan balance of $21,563.93 (she’s since paid down the total owing to about $20,000), the bank cited her company’s poor financial results.

Yvette can’t argue that point. Nor could you blame her ex-benefactors for swallowing hard when they scanned the financial statements she filed with the bank every three months.

“Our deficit, at the end of our first year was $47,000,” she admitted. “Our losses for 2000 were $66,000. Our losses for 2001 were $35,000.”

Still, those losses were fully covered by a shareholders’ loan made to Yve’s Creations Ltd. by Yvette and her life partner, Gary Budnik.

Suppliers, employees and bills were paid throughout the lean times. Yvette had never taken a penny in salary.

On top of that, greatly improved sales numbers indicated the business stood a good chance to turn itself around.

Sales revenues through November reached almost $63,000, a significant jump from $43,847 in the same period last year.

In business since 1998, Yve’s Creations Ltd. designs, manufactures and retails “adaptive clothing” for the aged and infirm. These are good-looking clothes that allow freedom of movement, comfort and ease of dressing for the disabled.

With Canadian baby boomers aging en masse, Yvette believes she’s at the forefront of an unlimited growth industry.

She attributes her rocky start to a flawed marketing plan, and a whack of unforeseen advertising costs. She has since adjusted certain questionable cost judgments that beat up on her early bottom line.

“I was paying $6 a metre for fabric that I now buy for $1.99,” she cited one example.

Besides, she knew going in it would take a minimum of five years to build the business.

Yvette’s error was in thinking the bank understood the same thing.

She realizes that, by definition, a demand loan can be called at any time. But she wonders whether other small operators realize how suddenly the whip can come down.

“I want this type of loan changed from a demand loan to a default/demand loan. A demand loan is a haven for abuse of power,” charged Yvette, who has launched a quixotic one-woman crusade to change bank policy.

If necessary, she hopes to take the issue all the way to the federal superintendent of financial institutions.

“The fact it’s a five-year amortization gives you the impression they’ll stick with you the entire term,” she spat. “If they’re only prepared to stay in for three years, they should make that clear in their ads.”

She produced a sheaf of RBC advertisements, including some in which the bank “celebrates” women, and proclaims itself “dedicated to nurturing . . . women entrepreneurs.”

Yvette’s well-developed sense of irony finds it all a bit rich.

But perhaps the best part of the story is the support coming from Yvette’s own customers.

One, a retired professor, was so alarmed when he heard the details, he immediately extended her a $40,000 loan, at minuscule interest.

So when Yvette met with Royal Bank regional VP Bill Bannister the other day, she was able to turn down his latest offer – several months’ extension of the Dec. 31 deadline.

(When asked, via e-mail, to explain bank policy, Bannister replied that he was not able to discuss client situations.)

Thanks to partner Budnik’s support, Yvette’s “angel,” and to her own moxie, the doors of Yve’s Creations Ltd. will remain wide open.

At last glance, her bankers – the country’s second-most profitable corporation – were scraping by, too.