Small Business Banks and SBA Loan Guarantees

Small Business  Banks  and SBA Loan Guarantees

This book clarifies the reasons for the often heated debate and offers new insights into whether the program does indeed subsidize the weak or perform a valuable service in bridging the small business credit gap.

Author: Elisabeth Rhyne

Publisher: Praeger

ISBN: UOM:39015014158797

Category: Business & Economics

Page: 178

View: 596

The author, with the cooperation of the Brookings Institution and the Congressional Budget Office, analyzes the efficiency of the Small Business Administration. In the book's seven chapters Rhyne examines loan rate defaults, the subsidy issue, how banks respond to incentives to lend, and the philosophic question of the ultimate purpose of the SBA program. Coverage includes historical aspects, the life cycle of SBA loans, and various policy and financial issues of SBA programs. Rhyne is critical of the SBA loan guarantees; she presents recommendations for reforms and discusses the implications for other credit programs. . . . Original government data sources were used extensively in the research, making the work quite definitive as of the publishing date. Choice The Small Business Administration (SBA) loan guarantee program--one of the mainstays of small business financing--has been both sharply attacked as wasteful and staunchly defended as essential during recent debates over the Federal budget. This book clarifies the reasons for the often heated debate and offers new insights into whether the program does indeed subsidize the weak or perform a valuable service in bridging the small business credit gap. Rhyne argues persuasively that despite recent program improvements, the SBA allows a hefty subsidy to continue by tolerating frequent, costly defaults. She recommends that the program seek to become financially self-sustaining, thereby adopting a simple market-making function rather than a credit allocation role. The book with a brief history of the SBA program and its predecessor in the Reconstruction Finance Corporation. The author describes the program's political environment and demonstrates the central role of banks in the program. She then moves to a thorough analysis of the program's financial performance and assesses the impact of SBA loans on banks. Subsequent chapters examine the cost of the program to the SBA, the social goals of the program and how well it fulfills them, and the changes made in the program during the 1980s to improve its management efficiency. The final chapter explores policy changes that could improve the program's overall performance and offers recommendations for reform ranging from minor management improvements to major program restructuring. A landmark critique of a major governmental program and its impact on the business community, this book should be read by every banker, small business owner, and legislator with an interest in the fate of the SBA loan guarantee program, or in the government's role in credit allocation.
Categories: Business & Economics

The Repercussions on Small Banks and Small Businesses of Procyclical Bank Capital and Countercyclical Loan Guarantees

The Repercussions on Small Banks and Small Businesses of Procyclical Bank Capital and Countercyclical Loan Guarantees

Small businesses rely on banks for credit more than large businesses do.

Author: Diana Hancock

Publisher:

ISBN: OCLC:1290320379

Category:

Page: 45

View: 999

Small businesses rely on banks for credit more than large businesses do. As a result, small business may be more adversely affected when adverse shocks, such as reduced bank capital or higher interest rates, reduce the supply of bank loans. We use annual, state-level data for 1990-2000 to estimate: (1) how much lower bank capital and higher interest rates affected businesses of various sizes, (2) how much SBA-guaranteed loans cushioned small business in particular and the economy more generally, and (3) whether the effects were larger during recessions and when interest rates were high.Lower bank capital and higher interest rates reduced bank lending, economic growth, employment, and payrolls at businesses of all sizes. Furthermore, lower bank capital at small banks impinged more on small business than on large business. The results also provided some weak evidence that SBA-guaranteed loans raised economic growth rates, employment, wages and salaries, and non-farm proprietors' incomes. SBA-guaranteed loans were less procyclical and less affected by capital pressures on banks than were non-guaranteed loans. As a result, SBA programs tended to stabilize the economy by offsetting the effects of recessions and bank capital pressures. When economic growth was slow or interest rates were high, the effects on small business of per unit change in bank capital, loan delinquencies, and SBA-guaranteed loans were larger.
Categories:

The SBA Loan Book

The SBA Loan Book

You need this new edition of Charles Green's invaluable book to chart the best way to apply for and get an SBA loan.

Author: Charles H Green

Publisher: Simon and Schuster

ISBN: 9781440510021

Category: Business & Economics

Page: 240

View: 186

Spurred by President Obama, the Small Business Association has stepped up its loan program to companies around the nation. But to receive an SBA-guaranteed loan, firms must navigate a complex course of processes, qualifications, documentation, and approvals. You need this new edition of Charles Green's invaluable book to chart the best way to apply for and get an SBA loan. Green wastes no time in showing: Why an SBA loan guarantee is a good option in tough economic times How to choose the right bank at a time when many banks have failed and credit is tight What the new rules and regulations say about the paperwork and documentation loan applicants must supply In today's turbulent economic climate, solid financial backing is the key to small business survival. And this fully updated guide to SBA loans will help you land it.
Categories: Business & Economics

SBA Loans

SBA Loans

In 1987 the SBA made 17,110 loans totalling $3 billion, most of which were made by banks with SBA guarantees against default.

Author: Patrick D. O'Hara

Publisher: John Wiley & Sons Incorporated

ISBN: UOM:35128000991495

Category: Business & Economics

Page: 230

View: 828

This step-by-step guide shows how the Small Business Administration (SBA) of America can help to start or maintain a small business. In 1987 the SBA made 17,110 loans totalling $3 billion, most of which were made by banks with SBA guarantees against default. It explains how business owners without a financial or legal background can take full advantage of the SBA, including clear, straightforward instructions on preparing the SBA loan application package. The author discusses the multitude of services the SBA can provide free of charge, such as technical and management assistance, procurement assistance, business classes, and publications, and provides easy-to-follow examples and sample forms.
Categories: Business & Economics

Bank SBA Loans a Partnership for Small Business Progress

Bank SBA Loans  a Partnership for Small Business Progress

The Small Business Administration participation loan plans provide for cooperation between private lenders and the Government in meeting the credit needs of small businesses . The plans benefit the banks and other participating ...

Author: United States. Small Business Administration

Publisher:

ISBN: UIUC:30112106853960

Category: Small business

Page:

View: 776

Categories: Small business

Small Business Administration Program Review

Small Business Administration Program Review

Hearings Before the Subcommittee on SBA and SBIC Authority, Minority Enterprise, and General Small Business Problems of ... banks showed that up to 40 percent of their long - term loans to small business concerns had an SBA guarantee .

Author: United States. Congress. House. Committee on Small Business. Subcommittee on SBA and SBIC Authority, Minority Enterprise, and General Small Business Problems

Publisher:

ISBN: PURD:32754078110610

Category: Small business

Page:

View: 735

Categories: Small business

Fiscal Year 1988 Small Business Administration Budget

Fiscal Year 1988 Small Business Administration Budget

The SBA Loan Guarantee Program is a very real factor in enabling commercial banks to assist all small businesses , but especially new startup companies that desperately need long term financing . The ABA has consistently supported the 7 ...

Author: United States. Congress. House. Committee on Small Business

Publisher:

ISBN: UCR:31210024917211

Category:

Page: 359

View: 255

Categories:

Bank Deregulation and Its Impact on Small Business Lending

Bank Deregulation and Its Impact on Small Business Lending

When the prospective borrower lacks experience , is under capitalized , has little or illiquid collateral , or requires a longer payment period than the average loan , a guarantee by the SBA permits a bank to offer a small business more ...

Author: United States. Congress. House. Committee on Small Business. Subcommittee on Tax, Access to Equity Capital, and Business Opportunities

Publisher:

ISBN: PURD:32754078109299

Category: Bank loans

Page: 272

View: 770

Categories: Bank loans

Business Basics in Hawaii

Business Basics in Hawaii

The Small Business Administration ( SBA ) Loan If the banker views a new small business as a high risk , a loan ... a loan guarantee , the SBA works with a bank to provide a guarantee of up to 90 percent for the loan made to the small ...

Author: Dennis Kondo

Publisher: University of Hawaii Press

ISBN: 0824811933

Category: Business & Economics

Page: 288

View: 160

Written in easy-to-understand language, Business Basics in Hawaii introduces the lay person to some of the basic principles of business. Readers benefit from lessons learned by other business people through an examination of two hypothetical companies. Some of the topics covered include estimating market potential and monthly operating costs, planning an advertising campaign with local media, negotiating a lease, and reviewing some Hawaii business tax laws.
Categories: Business & Economics