Posted
8:26 PM
by Gene
Bank of America hiring small biz bankersBUT (and with such a big butt there must be a big BUT):
Credit lines and loans to small companies were slashed during the Great Recession. Federal Reserve chairman Ben Bernanke recently estimated that $40 billion worth of loans to small businesses disappeared.
Bank of America played its part in the decline. Like many banks, it makes loans through the Small Business Administration's government-banked lending programs. Those loans represent a very small portion of overall small business lending, but they are an easily tracked indicator of a bank's lending activity -- and Bank of America has pulled back sharply.
In 2008, Bank of America made 3,296 loans totaling $102.3 million through the SBA's flagship 7(a) loan program. Many went bad: Ken Lewis, then the company's CEO, infamously called the bank's small business loan portfolio a "damn disaster." In 2009, at the height of the credit crisis, the financial giant made just 308 SBA loans, totaling $17.6 million.
Its lending barely picked up in 2010. In the SBA fiscal year that ended Sept. 30, Bank of America made 185 7(a) loans, totaling $22.8 million.