US SBA ARC Loan Update

Here's a quick snapshot of the impact of the US SBA ARC Loans, listed by US SBA Regions and also a 'Fact Sheet' on the impact of the ARC loans. The MnSBDC is located in Region 5.

Click here for Fact Sheet

Click here for a Snapshot Graphic

$10 Billion reduction in Small Business Lending by Big Banks

MnSBDC clients have been experiencing the "credit crunch" first hand. While Mn leads the nation in ARC loans that have helped small business clients to continue to operate, these loans come primarily from regional and community banks rather than the large national banks. The latest data indicates that the large banks that have received TARP funds designed to help spur lending to small business clients have in fact pulled back from lending to small business.

The notable exception among big banks is US Bank (US Bancorp), headquartered in Minneapolis, which increased it's lending by almost 2%. Also, BB&T Bank (located in the Southeast) remained essentially at the same level for small business lending.

Click here for the full story.

Minnesota Leads the Nation in the number of ARC Loans.

As of October 26, 2009, 3,598 ARC loans have been approved. By the end of FY09, the program approved $93 million of the alloted $336 million. Minnesota has the most nationwide with 446 ARC loans.

Here's a link to the details from the US SBA Website.

ARC Loans in MN over 350!!

The latest count for ARC loans in MN is over 350. See link below for the latest information;

http://www.sba.gov/idc/groups/public/documents/sba_homepage/sba_recovery_arc_lenders.pdf

7(a) Fees and 504 Fees Effective On
October 1, 2009

Each year SBA reviews the fees payable to SBA by 7(a) participating lenders (Lenders), certified development companies (CDCs), and borrowers to determine if they are sufficient to cover the estimated costs of the 7(a) and 504 loan programs. The purpose of this notice is to announce the fees effective October 1, 2009, for both programs for loans approved during FY 2010.
7(a) Loan Program
For 7(a) loans approved on or after October 1, 2009, the “Yearly Fee” due from Lenders to SBA will be 0.55 percent (55 basis points) of the guaranteed portion of the outstanding balance on the 7(a) loan. This fee remains the same as for FY 2009. The 7(a) Yearly Fee is imposed under Section 7(a)(23) of the Small Business Act and is referred to as the “ongoing service fee” in the 7(a) Authorization Wizard.
All other fees in the 7(a) loan program will be the same as for FY 2009. A description of these fees may be found in SOP 50 10 5.
504 Loan Program
For 504 loans approved on or after October 1, 2009, the “Annual Fee” paid by borrowers on an ongoing basis to SBA will be increased from zero percent to 0.389 percent (38.9 basis points) of the outstanding balance of the 504 loan. The 504 Annual Fee is imposed under Section 503(b)(7) of the Small Business Investment Act.
All other fees in the 504 loan program will be the same as for FY 2009, including the one-time guaranty fee that SBA is authorized to charge under Section 503(d)(1) of the Small Business Investment Act (which remains at zero). A description of these fees may be found in SOP 50 10 5.
Recovery Act Loans
Fees for 7(a) and 504 loans made under the American Recovery and Reinvestment Act will continue to follow the policies in the Federal Register Notices of June 8, 2009 (Business Loan Program Temporary Eliminations/Reductions in Fees, 74 FR 27196)(Business Loan Program Temporary Increased Guaranty Percentage, 74 FR 27199).
Notification and Questions
These fee changes are effective for Fiscal Year 2010, unless superseded by another Information Notice. SBA field offices must notify Lenders and CDCs of these changes.

SBA Administrator and Local Officials Spotlight Economic Relief to Minnesota Small Business

Over $10 Million Dollars in ARC Loans Already Disbursed to Nearly 700 Businesses in the Twin Cities Through the U.S. Small Business Administration

SBA Administrator Karen Mills joined Venture Bank at a news conference on Wednesday, September 23 at Crystal Kitchen Center (3620 Winnetka Ave N, Crystal, MN) to recognize the positive impact the American Recovery and Reinvestment Act (ARRA) is having on local small businesses’ ability to secure financing.

JoLynn Johnson of Crystal, Minnesota took advantage of SBA’s loan products by accessing an American Recovery Capital (ARC) loan which helped her meet day to day operating costs. The ARC loan provides no interest, deferred repayment loans of up to $35,000 used to pay down existing debt---providing a “bridge” for viable small businesses facing economic challenges.

“The ARC loans are another tool in the SBA toolkit which can provide critical support to small business owners like JoLynn Johnson to fulfill the American dream and keep their doors open,” said Administrator Karen G. Mills.

SBA’s instant capital infusion allowed JoLynn to get back on track. "Cutting costs, managing expenses and doing everything right doesn’t help when the customers aren’t buying due to uncertainty in the economy," says JoLynn Johnson, President of Crystal Kitchen Center, Inc. "The ARC loan is helping my business survive through these tough economic times."

Since 1975, Crystal Kitchen Center has earned a reputation in the upper Midwest for providing quality and leadership in kitchen and bath design. They work with new construction as well as renovations, providing services from design to complete "turn-key" remodeling. With their 8800 square foot showroom customers can find inspiration for their style. Crystal Kitchen Center prides themselves on designing and supplying cabinetry and counter tops for unique kitchens, bathrooms, entertainment centers, laundry rooms, home offices, lower levels, and outdoor kitchens. Their award-winning Certified Kitchen Designers are also versed in aging-in-place and green design, helping make their customer’s dreams come true.

"Now is the time for SBA loans. With 90% guarantees, temporary fee eliminations and the ARC loan program, Venture Bank is able to meet our goal of helping our customers grow their business and be successful. We are very strong supporters of the SBA loan programs," says Michael T. Zenk, President of Venture Bank. Venture Bank was founded in 2001. They currently maintain three locations in Bloomington, Golden Valley and Eagan. Venture Bank is one of Minnesota’s most active SBA lenders.

Since the signing of ARRA, SBA’s loan products have made a significant impact throughout the State with weekly increases in loan dollar volume. To date, SBA has supported $337.4 million dollars in small business lending to over 1,000 Minnesota small businesses.

SBA Funding for Loan Guarantees may run out by year end.

A great status report by the SBA (including the graphic above) can be found here;

http://sba.gov/idc/groups/public/documents/sba_homepage/recov_perform_reports_07_2009.pdf

From the report; "Approximately 45.1% of total FY2009 and FY2010 funds available for loan approvals in the 7(a) Loan Program, the 504 Loan Program, and the ARC Loan Program have been approved as of July 31, 2009."

A year end re-examination process most likely will result in additional funds allocated to the program based on need and the success of the SBA Loan Guarantee program.

Listing of MN Banks making SBA ARC Loans

Below is the URL to the listing of banks making ARC loans.

For your Convenience, I have extracted and pasted all the MN Banks below in alpha order. Check the weblink, since it will be updated weekly.

http://www.sba.gov/idc/groups/public/documents/sba_homepage/sba_recovery_arc_lenders.pdf



Lender // States Where Loans Made// Website
Access Bank MN www.accessbank.com

Alliance Bank MN www.alb.kz

American Heritage National Bank MN www.logbank.com

BankCherokee MN www.bankcherokee.com

BankVista MN www.bankvista.com
BANKWEST MN www.bankwestmn.com

Central Bank MN, WI www.centralbankar.com

Citizens Bank & Trust Co MN www.cbhutch.com

Citizens State Bank IA, MN, WI #N/A

Citizens State Bank of Waverly (Incorporated) MN www.bankwaverly.com

Community Bank Mankato MN www.cbfg.net

Community Bank of the Red River Valley MN www.cbrrv.com
Community Bank, Austin MN #N/A

Falcon National Bank MN www.falconnational.com
Farmers and Merchants State Bank of Blooming Prairie MN www.fmbankmn.com

Farmers State Bank of Madelia, Inc. MN www.madelia.com

First Minnetonka City Bank MN #N/A

First National Bank of the Lakes MN www.fnblonline.com

First National Bank of the North MN www.fnbns.com

First State Bank of Grove City MN #N/A
First State Bank of St. Joseph MN www.fsbstjoseph.com

Flagship Bank Minnesota MN www.flagshipbanks.com

Frandsen Bank & Trust MN www.frandsenbank.com

Freeport State Bank MN #N/A

Kanabec State Bank MN www.kanabecstatebank.com

Lake Elmo Bank MN www.lakeelmobank.com

Mid-Minnesota FCU MN #N/A

Minnesota National Bank MN www.mn‐bank.com

North American Banking Company MN www.nabankco.com

Northern National Bank MN www.northernnationalbank.com

Peoples National Bank of Mora MN www.pnbmora.com

Premier Bank MN www.premier‐bk.com
Prior Lake State Bank MN www.priorlake.com

Republic Bank, Inc. MN www.bankrepublic.com

Security Bank and Trust Company MN www.security‐banks.com
Security Bank USA MN www.securitybankusa.com

Security State Bank of Fergus Falls MN www.ssbfergus.com
Security State Bank of Hibbing MN www.ssbhibbing.com

SouthPoint FCU MN #N/A

The Bank of Elk River MN www.thebankofelkriver.com

The First National Bank of Cokato MN #N/A

The First National Bank of Plainview MN www.fnbplainview.com
The First National Bank of River Falls MN, WI www.fnbrf.com

The Lake Bank MN www.thelakebank.com

The RiverBank MN, WI #N/A

United Community Bank MN www.ucbi.com

United Minnesota Bank MN www.unitedminnesotabank.com
United Prairie Bank MN www.unitedprairiebank.com

Voyager Bank MN www.voyagerbank.com

Western National Bank MN www.wbduluth.com

Western National Bank of Cass Lake MN www.wbcasslake.com

Woodland Bank MN www.woodlandbank.com
Woodlands National Bank MN #N/A