October 12, 2016
By Bob Coleman
Editor, C-Suite Wednesday
C-Suite Wednesday — SBA Oversight Bill Status Update
The SBA Oversight bill passed by the Senate in June remains in limbo.
Georgia Congressman Lynn Westmoreland told bankers at the USDA B&I lending forum in Atlanta last month corresponding legislation has not been introduced in the House of Representatives.
A member of the House Committee on Financial Services, Lynn noted the legislation is sponsored by a lame duck senator, David Vitter. He left the audience with the strong impression if introduced, the legislation would not gain much traction in the House.
That doesn’t mean the bill is dead. ICBA’s Vice President of Congressional Relations, John Hand tells me something could happen in the lame duck session after the election. “We’ll know more in a few weeks.”
Endorsed by NAGGL, ABA and ICBA the bill lowers the SBA 7(a) secondary market premium tax 50/50 split from 110 to 108 in order to fund greater oversight of SBA 7(a) lenders.
The industry quickly realized the new regulations would be paid for by SBA 7(a) lenders who sell to the secondary market, and not the Wall Street banks that portfolio their loans.
87% of the 162 Coleman Report survey takers oppose the bill.
With this understanding, ABA and ICBA urged legislators not to adopt provisions that will force community banks to leave SBA lending programs due to “imbalanced or overly restrictive cost and fee structures.”
Check out our original reporting: