Small Business Lending Rises in 4th Quarter 2011
Institutions participating in the Small Business Lending Fund significantly increased small business lending in the 4th quarter of 2011 by $1.3 billion over the 3rd quarter—for a total of $4.8 billion over their baseline. A substantial majority of SBLF participants have now increased their small business lending by 10% or more.
Treasury released its latest report to Congress that demonstrates an increasingly positive trend in lending by institutions participating in the Small Business Lending Fund (SBLF) when compared to financial institutions that do not. The report shows that institutions participating in the Small Business Lending Fund significantly increased small business lending in the last quarter of 2011 by $1.3 billion over the prior quarter—for a total of $4.8 billion over their baseline (the average lending reported in the four quarters before the Small Business Jobs Act, which created the SBLF, was enacted). The loans the participating institutions make mark important progress toward helping to support small businesses and local economies across the nation.
The increases in lending are spread across the participating institutions. To date, 235 of the 281 participating community banks and 43 of the 51 community development loan funds (CDLFs), or 84 percent, have increased their small business lending. And a substantial majority of SBLF participants—more than 68 percent—have now increased their small business lending by 10 percent or more. In dollars, community bank participants have increased their small business lending by $4.7 billion and CDLFs increased their small business lending by $95.4 million.
The report also shows that SBLF banks have increased business lending by substantially greater amounts than a comparison group of non-SBLF banks across median measures of size, geography, and loan type. SBLF banks have increased business loans outstanding by a median of 21.5 percent over baseline levels, versus a 1.1 percent median increase for the group of non-SBLF banks. These increases have a huge impact in their communities where small businesses have more access to lending.
Small businesses play a critical role in the U.S. economy and are central to creating jobs and restoring our economic prosperity. The Administration is committed to doing everything it can to create an environment in which entrepreneurial small businesses can succeed and excel. This second report on SBLF is encouraging, and we look forward to continued strong reports in the future.
Don Graves is Deputy Assistant Secretary for Small Business, Community Development, and Housing Policy.