SBA Sets New Small Business Lending Records
During FY 2016, 7(a) loan program reaches more than $24.12 billion nationally, $68.5 million in SBA Alaska District; 504 loan total grows for third consecutive year; minority lending reaches $8.65 billion
ANCHORAGE, Alaska – The U.S. Small Business Administration (SBA) announced Fiscal Year 2016 (FY 2016) lending numbers this week showing record levels of small business lending through the 7(a) and 504 loan programs, as well as significant increases in lending to women, veterans and underserved communities.
“Access to capital is critical to a small business’ success. The SBA Loan Guarantee Program helps small businesses in our community keep their shelves stocked, keep their employees paid and keep their doors open,” SBA Regional Administrator Calvin Goings said. “Through resources like SBA LINC and local ‘meet the lenders’ events, the SBA connects local business owners with financing partners in their area.”
The following outlines national loan numbers and trends along with local lending highlights for the SBA Alaska District.
Nationally, the SBA approved more than 70,000 loans in the 7(a) and 504 loan programs during FY 2016. These programs provided nearly $28.9 billion to small businesses and supported nearly 694,000 jobs.
Locally in the SBA Alaska District, the SBA approved a total of 168 loans in the 7(a) and 504 loan programs during FY 2016 totaling $75.8 million. “Thanks to the hard work and outreach by our lending partners, SBA staff, and our resource partners, as well as the small business owners themselves, we have been able to put more capital into the hands of Alaska’s entrepreneurs,” said Nancy Porzio, District Director SBA Alaska Office.
SBA 7(a) Loan Program
The SBA’s flagship loan program, referred to as 7(a), provides small businesses with comprehensive financial assistance covering the vast majority of small business needs including working capital, fixed and intangible asset financing, as well as refinance and export support through term and revolving loans.
During FY 2016, the 7(a) program supported a record number of loans nationally – more than $24.12 billion combined across 64,073 loans. Both the total number and dollar amount of 7(a) loans increased by 1 percent and 2.6 percent respectively from the previous year.
In the SBA Alaska District, the 7(a) program supported more than $ 68.5 million combined across 155 loans. The average loan size was $442,192.
Across the country, the SBA continues to streamline and improve access to its loan program for small loans and underserved markets delivering more than 44,000 small loans of $350,000 or less during FY 2016. In the SBA Alaska District, the number of small loans was 106.
SBA 504 Loan Program
504 loans provide small businesses with long-term fixed rate financing to acquire fixed assets for expansion or modernization. 504 loans are available through Certified Development Companies (CDCs), who are SBA community-based partners.
During FY 2016, the 504 program grew by more than 10 percent to $4.74 billion – the third consecutive year of growth – and a 2 percent growth in loan volume.
In the SBA Alaska District, the 504 program provided $ 7.2 million in loans.
Re authorization of the 504 Debt Refinancing Program in May was instrumental in the success of the 504 Program during FY 2016.
Local Industry Trends
During FY 2016, the following were the top 10 industries to receive SBA loans in the SBA Alaska District by loan volume and loan numbers. Industries are categorized using North American Industry Classification System (NAICS) codes:
Top 10 Industries by Loan Number and Volume
* Retail Trade - 29 loans, $7.4 million
* Health Care - 20 loans, $10.1 million
* Construction - 19 loans, $ 6.1 million
* Professional /Science/Technology/Service - 14 loans, $9.9 million
* Manufacturing - 12 loans, $4.2 million
* Accommodation Food Service - 12 loans, $5.1 million
* Arts/Entertainment/Recreation - 11 loans, $1.4 million
* Transportation/Warehouse - 10 loans, $12.9 million
* Real Estate/Rental - 9 loans, $10.2 million
* Other Services - 9 loans, $916,400
Other Areas of Record-Setting Lending
SBA lending had a significant positive effect on various underserved groups during FY 2016. Minority business owners received a record combined $8.65 billion in 7(a) and 504 approved lending. This record reflects the priority of the Administration and the SBA in helping communities that historically find it difficult to access capital.
For the fifth consecutive year, 7(a) lending to women-owned businesses – both majority- and minority-owned – increased in total dollar and volume. FY 2016 lending was nearly $7.3 billion, an increase of $253 million from FY 2015.
In the SBA Alaska District, 7(a) lending to women-owned businesses was $35.7 million via 70 loans, up 3.9 percent in loan volume from last year.
504 loans are up for the third year in a row. During FY 2016, 504 lending exceeded $646.6 million with lending to women-owned businesses increasing by 5.9 percent or $36.3 million over the previous year.
In the SBA Alaska District, 504 lending to women-owned businesses was $ 4.5 million via 4 loans.
The total number of SBA loans to veterans is up more than 4 percent from the previous year; and, for the second year in a row, 7(a) and 504 lending to this group surpassed $1.36 billion.
In the SBA Alaska District, 14 loans totaling $ 6 million went to veterans.
The SBA export loan program helps American small businesses reach customers in the global market and compete on an equal footing in countries around the world. During FY 2016, the SBA had another record year guaranteeing more than 1,800 small business export loans, which supported more than $1.5 billion in financing to small business exporters.
In the SBA Alaska District, five export loans totaling $10.2 million went to local small businesses.
During FY 2016, the SBA Office of Disaster Assistance responded to 289 declared disasters across the country, including processing more than 59,150 home and 8,531 business applications and approving 25,235 loans for more than $1.4 billion.
For more information about SBA loan programs, financial assistance and other services, visit www.sba.gov.
About the SBA Alaska District Office:
The SBA Alaska District serves all of Alaska with locations in Anchorage and Fairbanks. SBA Alaska District staff provide resources and services in three areas referred to as “the three C’s” – counseling, capital and contracting. Visit www.sba.gov/ak for more information including resource partners, lenders, workshops, success stories and other resources to help business start, grow and succeed.