What is Bank of America’s Definition of Small Business?
January 24, 2013
This press release popped up on the web – Bank of America’s new loans to small business jumped 28% nationwide in 2012, and 41% in California alone.
Some glowing stats — The bank touts the hiring of 1,000 small business lenders nationwide; meeting with over 300,000 small business owners and $20 billion in small business lending in 2012.
It writes, “Bank of America is among 13 banks that have pledged to the White House and the SBA to increase new small business lending by a total of $20 billion through 2013. In 2011, the bank increased its new lending activity by $1.083 billion, surpassing its commitment. In 2012, Bank of America increased its new lending activity by an additional $1.9 billion.
“Bank of America is a top lender in the SBA 504 program. In the 2012 fiscal year, Bank of America originated more than $584 million in new first- and second-trust deed loans with long-term, fixed-rate financing. The bank also offers SBA 7(a) and Express loans for clients.
That’s impressive and nice, but the bank’s growth numbers seem to be at odds with other national trends of flat, at best, small business lending activity.
So, we ask, did the bank achieve real small business loan growth in 2012? Or are the numbers the result of how the bank defines small business? And, how much of the $20 billion is credit card lending?
Whatever the answers, it’s nice to see the bank at least tout a public commitment to small business lending. We clearly remember the quote by its former CEO several years ago calling the bank’s small business loan portfolio a “damn” disaster.