Employing more than half of the nation's nonfarm private workforce and, according to the Labor Department, generating 64% of net new jobs between 1993 and the third quarter of 2008, it is not hard to argue that small businesses are key to an economic recovery in the United States.
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Banks and lawmakers have been under heavy pressure to extend more loans to small businesses, as companies still struggle to overcome the depths of the worst recession in modern U.S. history. In December, a Senate committee passed two bills -- the Small Business Job Creation and Access to Capital Act of 2009 and the Small Business Export Enhancement and International Trade Act – that aim to increase loan limits, extend government guarantees and foster small businesses to grow exports. The full Senate will take up the legislation after the holidays.
“America ’s 29 million small businesses are really struggling with skyrocketing health insurance premiums and a tight credit market. Now that we have stabilized Wall Street, it is time to jump-start Main Street , and these bills will do just that," Small Business and Entrepreneurship Chairwoman Sen. Mary Landrieu (D-LA) said in a written statement.
FOXBusiness.com asked the nation's largest banks how much each lent to small business in 2009 as of mid December. Here are the results of the investigation.
Bank of America (BAC), in the first nine months of the year, said it facilitated $12 billion in credit to small businesses. The bank said it saw $2.5 billion in loan losses, including defaults, during the same time period. BofA is also working with small businesses to modify repayment plans: since September the company has modified loans to 49,000 clients.
JPMorgan Chase (JPM) said so far this year it lent $6 billion to companies with sales of less than $20 million. The company also said it plans to increase small business lending in 2010 by 67% to $10 billion and to hire an additional 325 bankers for the initiative.
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PNC Financial Services (PNC) said it originated $900 million in small-business loans in the third quarter, adding to the $9 billion the company had lent through September.
Wells Fargo (WFC) said it was on track to loan small businesses $13 billion in 2009. The company also this year increased its workforce of bankers on the small-business front by 5% to 31,500, and an additional 2%, or 700 bankers, will come on board in 2010.