SYRACUSE — M&T Bank is crediting several changes it made to its small-business lending model for the jump in its March loan-approval volume in the Syracuse district of the U.S. Small Business Administration (SBA). M&T Bank approved 49 SBA-backed loans in the agency’s (7a) program during March, which almost equaled the 51 such loans it […]
SYRACUSE — M&T Bank is crediting several changes it made to its small-business lending model for the jump in its March loan-approval volume in the Syracuse district of the U.S. Small Business Administration (SBA).
M&T Bank approved 49 SBA-backed loans in the agency’s (7a) program during March, which almost equaled the 51 such loans it approved from October through February — the first five months of the 2016 fiscal year.
In all, M&T Bank has made 100 loans in the 7(a) program, totaling $6.8 million, in the first half of the current fiscal year, according to SBA figures.
The 7(a) loan program is the “most widely used,” access-to-capital SBA program, with “flexible” use of proceeds and a loan maximum of $5 million, the agency says.
The SBA also has a 504 loan program, which offers long-term, fixed-rate financing for major assets such as land, building, and equipment, with a loan maximum of $5 million.
The SBA’s Syracuse district includes 34 counties in Central and Eastern New York.
M&T Bank “reassessed and lowered and streamlined” its processes and minimum dollar threshold, says Lee DeAmicis, regional business banking manager who works in the bank’s Syracuse office. He spoke to CNYBJ on April 22.
DeAmicis says M&T assesses the marketplace to determine what the needs are, indentifying what he called “microbusinesses,” or those companies that generate revenue of less than $1 million per year.
M&T determined it could meet a need for small-business lending in the SBA Syracuse district and “streamlined” some of its processes.
“We’ve lowered our threshold of the minimum loan size, particularly [commercial] lines of credit, from $25,000 to $5,000, and we added some staff to make sure we could get those increased volumes through the pipeline,” says DeAmicis.
Besides the reduced loan minimum for its SBA-backed loans, M&T also made the application process “easier” for the small-business market, streamlining the initial paperwork the bank needs to consider such loans.
The banking company also added staff to its Buffalo office to handle the small-business loan processing and underwriting functions.
Another change, DeAmicis notes, targeted M&T’s branch managers.
“We put in place a focus for them to go out and work with their small-business customers and prospects to bring this product to the marketplace,” he says.
M&T in March approved SBA-backed loans for some smaller trucking companies and retail operations.
“Startups are very risky and that’s where we often use the SBA to help offset the riskiness of industries like that,” he says.
Contact Reinhardt at ereinhardt@cnybj.com