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SBA Eastern Pennsylvania District Celebrates Robust Lending, Smaller Dollar Loans Drive Volume in fiscal year 2015

SBA District Director Tony Leta encouraged by strong pace of SBA lending
Release Date: 
Thursday, October 29, 2015
Release Number: 
20151029-001
Contact: 
Robert Goza (610) 382-3084 | robert.goza@sba.gov

EASTERN PENNSYLVANIA– The U.S. Small Business Administration’s Loan Programs have seen another near-record lending period for fiscal year 2015 across the 40 eastern counties of SBA’s Eastern Pennsylvania District Office. Eastern Pennsylvania’s SBA total loan approvals are up 11% from last year to 1,379 loans for $484,792,800 for SBA’s 7(a) and 504 loan programs combined.

Following several years of very high total lending numbers in the District, last fiscal year’s overall trend toward smaller loans was also seen this year. While the total dollars loaned is nearly the same, with roughly a 1% difference from last year’s total, the average loan size is down 11% to $351,554.  SBA’s guarantee fee waiver for loans below $150,000 has successfully spurred a smaller average loan size per loan.

“SBA’s initiative to make smaller loans available to businesses is showing success. Lenders are eager to take advantage of the credit enhancements offered by the SBA loan programs to reduce risk and expand customer relationships, as improvements in the economic climate continue,” said SBA Eastern Pennsylvania Director Tony Leta. “SBA continues to offer an incentive to small business owners by eliminating guaranty fees for loans under $150,000.  These loans create financing opportunities for entrepreneurs to start and grow their business.”

One of SBA’s primary missions is to ensure that small business owners have access to the capital they need to start and grow their business.  In pursuit of this mission, SBA’s Eastern Pennsylvania District has added lenders to its SBA lending partners portfolio, with an additional 12 lenders now participating this fiscal year.

SBA’s 7(a) loan guarantee program also continues to be in greater use by SBA’s lending partners to make more vital small business loans available to a wider number of small businesses, particularly start-ups and “mom and pop” businesses.  SBA’s flagship 7(a) loan program also reflects the trend toward more smaller-sized SBA loans in eastern Pennsylvania; with a 9% lower average loan size of $330,359.  This fiscal year saw a 13% increase in 7(a) loan volume and loan dollars 3% higher than last year for 1,324 loan approvals and $437,395,800.

Lenders play an important role as partners in SBA’s efforts to help small businesses across the nation, and through SBA’s lending partners these loan programs provide small businesses with a more comprehensive set of financing options to cover the vast majority of business expenses, such as short and long-term working capital, exports, and refinancing existing debt under certain conditions.  In 2015, M&T Bank made the most 7(a) loans, with 203 and Parke Bank loaned the most dollars with $28,607,000.  For further information on SBA Eastern Pennsylvania lending, go to https://www.sba.gov/offices/district/pa/king-of-prussia/resources/sba-philadelphia-district-loan-volume-report-fiscal-year-2015-10-01-2014-thru-9-30-2015

SBA also saw encouraging signs in microlending in eastern Pennsylvania.  The District had more active microlenders this year, increasing from seven to nine microlenders, with an average loan size and number of loans up substantially from 177 microloans for $1.72 million to 233 microloans for $2.57 million.  SBA microlender Finanta made the most loans and loaned the most dollars, with 168 loans for $1,570,700.

SBA’s Microloan program provides loans up to $50,000 to help small businesses by providing funds to specially designated intermediary lenders; microloans are available through certain nonprofit, community-based organizations that are experienced in lending and business management assistance.  Anyone can apply for a microloan, although these loans often favor people with low cash reserves or poor credit as well as those in underserved disadvantaged or rural communities.

The U.S Small Business Administration (SBA) Mid-Atlantic Region also announced its national fiscal year 2015 loan numbers.  This fiscal year SBA supported more than $1.5 billion in lending to America’s small businesses, giving small businesses critical access to the capital they need to start and grow their business. SBA loan approvals in SBA’s Mid-Atlantic Region supported $1,793,237,791 to small businesses in 7(a), 504 and microloans this fiscal year compared to $1,425,044,599 last fiscal year.

“Under President Obama, SBA lending has reached record levels in the Mid-Atlantic Region and we continue to get more capital into the hands of small business owners than ever before,” said SBA Mid-Atlantic Regional Administrator Natalia Olson-Urtecho who oversees the agency’s activities in Pennsylvania, Delaware, Maryland, Virginia, West Virginia and the District of Columbia. “The strength and resiliency of America’s 28 million small businesses are key to the nation’s continuing recovery from the Great Recession.”

SBA’s streamlined loan system, including SBA One and LINC, both of which rolled out this calendar year, are helping increase loan activity for small businesses and entrepreneurs across the nation. For more information about the SBA’s Loan Programs and other financial assistance as well as other programs and services, please visit www.sba.gov.

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