Banks eager to help clients get PPP cash while funds are available
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The Treasury Department announced Monday that during this quarter, it’s going to borrow $3 trillion to handle coronavirus expenses. The Small Business Administration released an update about the second round of the Paycheck Protection Program. As of Friday, $175 billion in loans had been approved.
That means there’s still a bunch of money to lend. For the banks that are processing those loans, that’s good to know.
Going into this past weekend, the Bank of Southern California was eager to hear from the SBA how much loan money had been approved so far.
“It helps a lot to know how much money is still available. You know, what resources do I need to work through the weekend,” said Nathan Rogge, the bank’s CEO.
Now that the SBA says PPP funding is still available, Rogge said the bank is going to start reaching out to customers and letting them know they can still take advantage of the program.
“I think a lot of people’s perception was, ‘Oh, it’s a complete mess. I missed the boat,’ ” Rogge said.
Bay State Savings Bank in Worcester, Massachusetts, is preparing for a surge in new applicants, according to President Peter Alden.
The bank’s employees are working long hours to submit applications during times of the day when there’s less competition.
“There’s been a lot of applications that have been inputted at night and other off hours, just to make sure that they get through,” Alden said.
Many new applicants are likely to be really small businesses with one or two employees.
“At least on our level, what we’re seeing is our largest customers have already participated,” said Chris Duncan, a senior loan officer at La Salle State Bank in Illinois.
Those smaller businesses are likely to take out smaller loans, so Duncan said it will likely take a week for the remaining $135 billion to dry up. Still, he sees no reason to slack off.
“We can’t look at that number and sleep on that number,” he said. “In our mind, in any point in time, that money could disappear.”
And even though money is still available, banks should be helping out the customers who have already applied, said Richard Baier, CEO of the Nebraska Bankers Association.
“The process now needs to shift going forward to how do we manage loan forgiveness, [and] how do we help make sure borrowers are in compliance?” Baier said. And, help customers manage the financial implications of their businesses reopening.
COVID-19 Economy FAQs
Are states ready to roll out COVID-19 vaccines?
Claire Hannan, executive director of the nonprofit Association of Immunization Managers, which represents state health officials, said states have been making good progress in their preparations. And we could have several vaccines pretty soon. But states still need more funding, she said. Hannan doesn’t think a lack of additional funding would hold up distribution initially, but it could cause problems down the road. “It’s really worrisome that Congress may not pass funding or that there’s information circulating saying that states don’t need additional funding,” she said.
How is the service industry dealing with the return of coronavirus restrictions?
Without another round of something like the Paycheck Protection Program, which kept a lot of businesses afloat during the pandemic’s early stages, the outlook is bleak for places like restaurants. Some in the San Francisco Bay Area, for example, only got one week of indoor dining back before cases rose and restrictions went back into effect. Restaurant owners are revamping their business models in an effort to survive while waiting to see if they’ll be able to get more aid.
How are hospitals handling the nationwide surge in COVID-19 cases?
As the pandemic surges and more medical professionals themselves are coming down with COVID, nearly 1 in 5 hospitals in the country report having a critical shortage of staff, according to data from the Department of Health and Human Services. One of the knock-on effects of staff shortages is that people who have other medical needs are being asked to wait.
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