Dr. Winslow Sargeant is the sixth Chief Counsel for Advocacy of the U.S. Small Business Administration’s Office of Advocacy, appointed by President Obama August 19, 2010. The Office of Advocacy...
Advocacy Study Ranks Banks on Small Firm Lending, Hints at Current Financial Trends
WASHINGTON, D.C. – The growth of small and microbusiness lending remained positive during the first half of 2008, although the expansion was slower than in the previous year, according to the latest edition of the Office of Advocacy’s annual study of lending to small firms. This new report, Small Business and Micro Business Lending in the United States for Data Years 2007-2008, gives a detailed account of small business lending overall, plus state-by-state totals and totals for individual lenders.
The study finds that for the year that ended in June 2008, the total value of small business loans outstanding increased 4 percent and the value of microbusiness loans outstanding increased 6.8 percent. Both rates were down from the previous one-year period, but they were still in positive territory. The largest increase was in the number of microbusiness loans (under $100,000), which were up by 15.7 percent. This may be an indication that more loans are being made through business credit cards. The number of mid-sized loans ($100,000 to $1 million) fell by 23.3 percent.
Small businesses that are looking for loans will find the report useful because it provides state-by-state rankings of banks and other financial institutions on their small business lending. These rankings show who made the most small and microloans in each of the 50 states and the District of Columbia. “In the current financial climate, it’s especially critical for small firms to know which banks and financial institutions have been the most likely to make small and microbusiness loans,” said Advocacy Economist Victoria Williams, coauthor of the study with Senior Economist Charles Ou.
The report uses the most recent Consolidated Reports of Condition and Income (Call Report) data for June 2007 to June 2008 and Community Reinvestment Act (CRA) data for 2007 to examine financial institutions’ small and microbusiness lending. Small business loans in these data are business loans of less than $1 million and microbusiness loans are loans of less than $100,000. The report ranks lenders on their overall small business lending, not lending under SBA programs.
The full study, including expanded state-by-state tables, is available online at www.sba.gov/advo/research/lending.html.
The Office of Advocacy, the “small business watchdog” of the federal government, examines the role and status of small business in the economy and independently represents the views of small business to federal agencies, Congress, and the President. It is the source for small business statistics presented in user-friendly formats, and it funds research into small business issues.
The Office of Advocacy of the U.S. Small Business Administration (SBA) is an independent voice for small business within the federal government. The presidentially appointed Chief Counsel for Advocacy advances the views, concerns, and interests of small business before Congress, the White House, federal agencies, federal courts, and state policymakers. For more information, call (202) 205-6533.