ACB: Press Releases

Contact:	Robert Schmermund (202) 857-3104 Jim Eberle (202) 857-3145	Jim Eberle (202) 857-3145 (work) (703) 893-2593 (home) [email protected]	For Immediate Release May 3, 2006 #06-24
E-mail: [email protected]

ACB PROVIDES PLAN TO INVOLVE BANKS IN SBA DISASTER LOANS

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WASHINGTON, D.C. — America’s Community Bankers has provided the Small Business Administration with a detailed plan to involve community banks in helping the agency process and deliver disaster assistance loans.

“Because banks have on-the-ground facilities and personnel in and around the affected areas, ACB believes that the SBA and community banks can work effectively together to leverage the SBA’s capabilities to provide small businesses with timely disaster assistance loans,” ACB said in a comment letter outlining a comprehensive program.

Under ACB’s Indirect Loan model, banks would provide loan service capabilities for a fee, underwrite loans for the SBA according to SBA loan guarantee guidelines and disburse the disaster loan funds. “We believe that this model should replace the SBA’s current model under which the agency itself makes direct loans to affected businesses in disaster areas,” ACB said.

Instead of the SBA hiring outside persons to establish its own disaster recovery center and loan information processing centers, the SBA could use existing bank branches and call centers to explain the loan process, distribute loan applications and screen them. “Banks are already set up to do this, and the process therefore could get underway more quickly,” ACB said.

Banks have a relationship with the business owners and understand which businesses would be creditworthy recipients of government disaster assistance loans, ACB added.

Click here to read the comment letter.

America’s Community Bankers is the national trade association committed to shaping the future of banking by being the innovative industry leader strengthening the competitive position of community banks. To learn more about ACB, visit www.AmericasCommunityBankers.com.

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