Small Business Lending Fund continuing community bank program

8/18/2011

The Small Business Lending Fund announced Wednesday that more community banks have received an influx of funding.

Under the Small Business Jobs Act of 2010, the SBLF is tasked with generating commercial funding for small businesses by investing in local lenders. Banks with less than $10 billion in total assets are considered for the program.

Wednesday's allocation of $418 million went to 37 community lenders. Banks that are selected for the program can reduce the repayment terms by producing more credit for small businesses - as lending increases, the dividend rate drops. Likewise, if commercial loans aren't realized through the funds, the rate could increase.

"These funds will provide critical support to Main Street community banks so they can expand their lending to small businesses," said Neal S. Wolin, deputy secretary deputy secretary of the U.S. Department of the Treasury. "This program helps entrepreneurs in communities across the country access the capital they need to grow their operations, invest in new equipment and hire additional workers."

Since the start of the program, over $1 billion has been distributed to 80 banks. Allocations began in June, and community banks are still applying for the next wave of funds.