The Small Business Administration (SBA) will impose a maximum dollar amount for individual lenders






The U.S. government notified lenders on Sunday that it will cap how much each bank can lend under the emergency loan program designed to keep workers on payrolls amid the coronavirus pandemic, hours ahead of the reopening of the lending program. The Small Business Administration (SBA) will impose a maximum dollar amount for individual lenders at 10% of Paycheck Protection Program funding, or $60 billion per lender, and pace the applications filed, according to SBA guidance on Sunday to lenders that have received a significant number of applications. U.S. banks were girding over the weekend for another frantic race to grab $310 billion in fresh small-business aid due to being released by the government. (Reuters)

Treasury Secretary Steven Mnuchin said that “overtime” the U.S. will need to look into the sharply rising budget deficits created by the multi-trillion-dollar coronavirus support packages. The good news, Mnuchin said, is that “interest rates are extremely low and we’re locking in long-term rates” at those levels. As Treasury and the Small Business Administration prepare to roll out a second tranche of the Paycheck Protection Program, Mnuchin said he was confident that the average loan size would be smaller than in the first round. (Bloomberg)

Source: Danarekas Sekuritas Debt Research

Image: Chicago, United States
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