SBA brings $86.5M to R.I. small businesses, 26% increase over last year

THE U.S. Small Business Administration supported lending $86.5 million to Rhode Island businesses in the fiscal year that ended Sept. 30.
THE U.S. Small Business Administration supported lending $86.5 million to Rhode Island businesses in the fiscal year that ended Sept. 30.

PROVIDENCE – The U.S. Small Business Administration supported lending $86.5 million to Rhode Island businesses in the fiscal year that ended Sept. 30, an increase of 26 percent from the $68.6 million loaned a year earlier.

At total of 433 SBA loans were approved, representing a 38 percent increase in the number of loans awarded through the federal agency’s programs. The total dollar volume loaned to Rhode Island small businesses is $111 million, the SBA said.

The loans were guaranteed through 44 financial institutions and certified development companies through its three loan programs – 7(a) loans (the most common program provided by the SBA, designed to help businesses in a general sense), 504 loans (designed to finance major fixed-asset purchases and which require direct loans through the SBA and capital participation from the borrower) and microloans (designed to help small businesses and certain nonprofits).

Thirty-two commercial lenders made 392 7(a) loans guaranteed by the SBA worth $67.6 million, according to figures released this week. In addition to the guaranteed loans through banks, financial institutions (including banks, credit unions and other private lenders) participating in the 504 program made an additional $24.5 million in loans to businesses that were not guaranteed.

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Coastway Community Bank made the most 7(a) loans with 89, followed by Bank RI with 85. However, Bank RI’s loans had the highest dollar volume at $11.3 million, followed by Coastway at $9.8 million. Coastway had the highest dollar volume of 504 loans, with five worth $5.7 million, while BankNewport had more 504 loans at six, representing $2.1 million.

Bay Colony Development Corp. directed the largest number of 504 loans, 11 worth $7.2 million, while New England Certified Development Corp. also had 11, worth $6.9 million. Ocean State Business Development Authority directed 7 loans worth $3.4 million.

South Eastern Economic Development Corp. had five microloans totaling $81,000 in the fiscal year, while Community Investment Corp. and Accion each had one microloan, at $41,400, and $5,060, respectively.

Providence had the highest number of loans at 59, as well as the largest dollar volume at $12 million. Coming in second was Warwick with 56 loans at $9.5 million. In fiscal 2013, the cities’ positions were reversed: Warwick had the most SBA loan activity with 46 loans worth $10.8 million, ahead of the 34 loans worth $5.1 million in Providence.

The federal agency said the 7(a) loan program reached another lending record nationwide in fiscal 2014, with 52,044 7(a) loans approved, representing $19.19 billion, an increase of 12 percent in number of loans and 7.4 percent in dollar amount over fiscal 2013.

“As our economy continues to grow and recover, small businesses are the essential fuel to that continued growth,” SBA Administrator Maria Contreras-Sweet said in a statement. “Thanks to the hard work and outreach by our lending partners, SBA staff and our resource partners, as well as the small business owners themselves, we have been able to put more capital into the hands of our nation’s entrepreneurs. We know that America’s small businesses pack the biggest punch, creating two out of every three net new private sector jobs in the U.S. These small businesses are the cornerstone of our communities, so their success and expansion is vital to the nation’s economic growth.”

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