Small business lending

The biggest U.S. banks reduced the portion of their collective balance sheets they’re dedicating to loans to a new low, extending a trend that’s seen the largest lenders put less and less of their firepower behind everyday borrowers.

A program that lets firms bundle Small Business Administration loans is on hold while Congress spars over a new budget. The impasse is causing headaches for banks that rely on loan sales for fee income.

With the COVID-19 pandemic creating unprecedented challenges for small businesses, American Express has increasingly targeted its investments in that niche.

The Senate Banking Committee met Wednesday to review central bank lending facilities such as the Main Street Lending Program, which provides bank-issued loans to middle-market firms. But some lawmakers on the panel said the focus of pandemic relief has been misplaced.

Bankers and fintech executives want lawmakers returning to Washington to focus on streamlined forgiveness and a second round of Paycheck Protection Program loans for small businesses.

More than $1 billion in coronavirus relief went to small businesses that received multiple loans and a congressional subcommittee analyzing the Paycheck Protection Program says it has seen evidence of fraud in thousands more loans.

The card giant could pay $850 million in cash for the online small-business lender, according to a person familiar with the talks.

The global pandemic and stalled trade negotiations have discouraged farmers and ranchers from taking on more debt and made banks uneasy about extending more credit.

Besides reauthorizing the Paycheck Protection Program, Congress should upgrade the loan forgiveness process, offer businesses the chance to take out a second loan and ensure the pricing satisfies lenders, bankers say.

Bankers Healthcare Group, affiliated with Pinnacle Financial, is launching into securitization to branch out from its primary strategy of selling its medical-professional loans to community banks.