NEWARK, NJ---The U.S. Small Business Administration backed $637 million in loans to New Jersey small business owners during the agency’s fiscal year 2013 (the period from Oct. 1, 2012 thru Sept. 30, 2013). This represented a 5 percent increase in the number of dollars the agency approved in the Garden State this year, pushing up the average size of an SBA loan to $548,000 from the previous year’s average of $516,000.
“Considering the devastation and destruction that Hurricane Sandy left behind, I am surprised that we were able to increase the amount of capital that New Jersey small business owners received during this past year,” said SBA New Jersey District Director Al Titone. “It certainly was challenging for all of us. It’s a credit to our lending partners who are committed to SBA‘s loan programs and dedicated to bringing economic growth to communities by investing in small business.”
According to Titone, 1,162 loans were approved by the New Jersey district office in FY 2013, a slight decline from the 1,172 loans approved in FY 2012. A breakout of the loan data showed that 64 percent of the total loan dollars went to existing businesses, while 36 percent went to start-up companies.
“Our 7(a) Loan Guarantee program drives the majority of our lending activity here in New Jersey, “said Titone. “The overall decline in the number of loans is due to the changes made to SBA’s 504 program. In 2013, small business owners could no longer take advantage of the program to refinance existing loans on real estate and equipment, which explains the slight dip in the overall number of loans small business owners received this year.”
“We saw an 18 percent jump in the dollars that were approved under the 7(a) loan program,” said Titone. “The dollar amount grew to $542.2 million from last year’s total of $458 million, and the number of loans saw a three percent uptick by going from 1,026 7(a) loan approvals to 1,055. That activity is encouraging and could be just the spark needed to spur economic expansion throughout the state.”
Titone noted that loan approvals to women–owned businesses and Hispanic-owned businesses showed significant gains in 2013. There were 226 loan approvals for $91.3 million to women-owned businesses in 2013, up from 170 loans for $74.4 million in fiscal year 2012. Hispanic-owned businesses received 87 loans for $19.6 million during fiscal year 2013, up from 66 loans for $23.2 million in 2012.
Overall SBA lending increased in eight of New Jersey’s 21 counties, while 11 counties saw a decrease and two counties remained the same. Bergen County led all SBA lending with 191 loans for $113.4 million. Middlesex County had the second most loan approvals with 115 loans for $73.3 million, followed by Monmouth County with 97 loans for $36.4 million. Rounding out the top five are Essex County with 85 loans for $39.9 million and Union County with 77 loans for $52.4 million.
According to Titone, the SBA worked with 105 lenders throughout fiscal year 2013. The leading lender was JPMorgan Chase Bank with 123 loans for $16.2 million. TD Bank followed with 107 loans for $24.6 million and Sovereign Bank with 77 loans for $18.7 million. Rounding out the top five lenders were Noah Bank with 69 loans for $82.8 million and Republic Bank with 67 loans for $81.2 million.
“Clearly, the primary mission at the SBA is to ensure that financing is available for small businesses trying to establish themselves, grow and create new jobs,” said Titone. “As the overall economic climate continues to improve, I see SBA loan programs as part of the solution that will spur economic change throughout New Jersey.”
For more information about these and other SBA programs, visit the SBA website at www.sba.gov/nj, or contact the SBA New Jersey district office at (973) 645-2434.