Banks could end up holding many low-rate Paycheck Protection Program loans on their books for two years, and dealing with irate borrowers who failed to meet federal requirements for forgiveness.
The agency’s IG says the PPP failed to prioritize borrowers in underserved and rural markets; the firms, which lack deposits to cushion them, are vulnerable to borrowers defaulting on their loans.
Late approval and delayed access to the Fed’s liquidity facility have forced fintechs to play catch-up in the Paycheck Protection Program. A strong finish could bolster their case for becoming full-fledged Small Business Administration lenders.
Mortgage lenders impose steep pricing adjustments for cash-out refinancing; bankers fear massive borrower fraud in the Paycheck Protection Program; some worry the coronavirus is giving banks an excuse to spy on employees; and more from this week's most-read stories.
The Independent Community Bankers of America accused the National Credit Union Administration of using the coronavirus outbreak to usher in additional changes without the normal amount of scrutiny.
The SBA's long-standing Economic Injury Disaster Loan program has been so overwhelmed with applications that the agency has capped loan sizes; ECB finding few takers for a program in which it pays banks to make business loans.
Up to 12% of loans under the $660 billion small-business rescue program could be tied to misleading or completely phony applications, fueling concerns about lenders' potential liability.
Stuart Levey, HSBC’s chief counsel and a former U.S. Treasury undersecretary, will head the cryptocurrency project; lender groups say the demands of those small business loans are not so easy to meet.
Regulators need to give more detailed guidance on the coronavirus relief program for small businesses so lenders don’t get trapped in underwriting mistakes down the road.
Prosecutors charge two Rhode Island men with trying to rip off the program; the bank says it has received “inquiries” from state and federal officials on its offering of small business loans.
