Starting at 2 p.m. Mountain Time, SBA systems will only accept loans from lending institutions with asset sizes less than $1 billion dollars
Moments ago, CBA received the below communication from the SBA:
"SBA and Treasury value all lenders and their small business customers.
To ensure access to the PPP loan program for the smallest lenders and their small business customers, starting at 4 p.m. today EDT through 11:59 p.m. EDT, SBA systems will only accept loans from lending institutions with asset sizes less than $1 billion dollars.
Please also note that lenders with asset sizes greater than $1 billion will be able to submit loans outside of today’s 4pm -11:59 p.m. EDT reserved processing time.
This reserved processing time applies today April 29, 2020. SBA and Treasury will evaluate whether to create a similar reserved time again in the future.
SBA and Treasury continue to monitor loan system performance and will continue to provide frequent updates to the lending community."
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As of 1 p.m. yesterday, SBA said it had approved more than 475,000 PPP loan applications submitted by more than 5,100 lenders for a total of more than $52 billion. The average loan size in the second round of funding—which opened yesterday morning—is $111,000, SBA reported, down from $207,000 in the first round. The majority of loans made since Monday—85%—have been for amounts of $150,000 or less. Roughly seven in 10 second-round loans were made by lenders with less than $10 billion in assets, amounting to nearly $30 billion.
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Mnuchin: SBA to Review PPP Loans Over $2M
The SBA will conduct a “full audit” of PPP loans made in amounts over $2 million to ensure the borrower’s legitimate economic need before they can be forgiven, Treasury
Secretary Steven Mnuchin told CNBC yesterday
. Mnuchin emphasized that the onus is on the borrower to certify its economic need when seeking a PPP loan.
“It’s the borrowers who have criminal liability if they made this certification and it’s not true,” Mnuchin confirmed, responding to recent reports of large firms—including at least one big-league professional sports franchise—that have sought and received PPP funding. Mnuchin added that the PPP “was a program designed for small businesses—it was not a program designed for public companies that had liquidity. The certification was very clear in saying that if people had other sources of liquidity, they could not take this loan.”
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SBA clarifies PPP’s 10-day disbursement window, fee payments
The Small Business Administration last night issued an interim final rule providing clarity on the 10-day loan disbursement requirement under the Paycheck Protection Program, as well as the filing required to receive the lender processing fee.
Moving forward, lenders must make a full, one-time disbursement of PPP loan funds within 10 calendar days of the loan being approved—that is, when a loan is assigned an SBA loan number. (If the end of this period falls on a weekend, or federal holiday, the final day will be the next business day.) For loans approved but not fully disbursed before the issuance of this rule, the 10-day period begins today, April 28.
However, SBA said, “lenders are not responsible for delays in disbursement attributable to a borrower’s failure to timely provide required loan documentation, including a signed promissory note.” If borrowers do not submit their required documentation within 20 calendar days of approval, the loan will be canceled.
To receive their lender processing fee, lenders must fully disburse the loan and file the yet-to-be-released SBA Form 1502 within 20 calendar days after the loan is approved. For loans approved before Form 1502 is made available, the form must be filed by May 18. If a borrower cancels the loan before disbursement or voluntarily terminates it and repays it after disbursement, the lender will not receive a processing fee.
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CO Div of Banking: Guidance on the Safer at Home Order
Now that Governor Polis has issued the Safer at Home Executive Order (
D 2020 044
)
,
the Colorado Department of Public Health and Environment (CDPHE) has also issued
Public Health Order 20-28
, which provides the requirements for implementation of Safer at Home, as directed by Governor Polis.
Many businesses and activities require specific guidance based on their business practices. The specific guidance, issued according to activity or industry type, are included in the appendices to the Public Health Order. Banks are encouraged to review the Order for the criteria and effective dates for businesses and other functions of society to operate under Safer at Home.
Additionally, some
Safer at Home FAQ
s have been developed that include a
“Local Governments” section for a full explanation.
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