Hot Topic Tuesday — SBA Secondary Market Update

February 4, 2020

By Caity Witucki
Contributing Editor, C-Suite Wednesday

Hot Topic Tuesday — SBA Secondary Market Update

In Washington DC, On January 8, 2020, the SBA provided an update on the secondary market and changes coming in the new SOP.

Here are the highlights from the SBA’s presentation:

  • Pools are up despite overall loan approvals being down about 8 percent in FY 2019.
  • Calendar year 2019 ended strong. Numbers were good at the end of December, but at the beginning of January, 7(a) volume dropped down about 11 percent YTD.
  • Pool settlements were up in 2019 with about 284 settled around $8.5 billion.
  • The SBA is in the final stages of drafting a secondary market program guide update. The update will include clarification but will not have any striking changes.
  • The SOP is planned to be delivered in February and will go live in April. The new SOP will contain a complete reorganization for reader usability and clarification. However, it will not contain any significant rule changes.
  • The SBA is reviewing the possibility of providing loan-level data to secondary market lenders.
  • Forms 1086 and 1502 are under review for modification and will be available for feedback in the near future.

Additional changes affecting the secondary market are expected to be addressed during the next 7(a) Connect Call on April 7, 2020. SBA 7(a) Lenders and secondary market investors are invited to pre-register for the event now.

7(a) Quarterly Connect Call