Small business lending increases; big banks passive on large loans
Overall lending to small businesses was up last year, according to new research from the Small Business Administration's Office of Advocacy. The value of outstanding small business loans in the $100,000 to $250,000 range rose 5 per cent from June 2003 to June 2004, and the value of loans in the $250,000 to $1 m range jumped 8.4 per cent. Loans of less than $100,000 declined in value, but that's probably due to accounting issues related to credit card account consolidation, SBA says. Large banks accounted for two-thirds of loans under $100,000 but "remained passive" in the $100,000 to $1 m small business loan market, the study found. "This poses the question of whether very large banks are moving away from higher-cost small business lending to lower-cost microbusiness credit card-credit line lending," the report states.
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