Have you thanked your banker today?
Local bankers have been working round the clock in recent weeks to help distribute hundreds of millions of dollars in stimulus funds to small businesses.
Those funds, in turn, have helped to preserve thousands of jobs that were temporarily sidelined by the coronavirus.
“Our associates have stepped up big time,” said Duane Dewey, president and chief operating officer of Trustmark National Bank. “They’ve been working very long hours, doing very tedious and very intense work.
“I couldn’t be prouder of how our associates have engaged to help our small business customers.”
Banks across the country have served as conduits to help distribute funds as part of the Small Business Administration’s (SBA) Payment Protection Program (PPP).
The funds so far have been made available in two rounds of stimulus funding through bills passed in Washington, D.C.
The first phase ran through mid-April. The second phase began later that month was continuing last week.
During the first phase alone, Trustmark processed some 6,000 loan applications and awarded $821 million, Dewey said.
“A very significant portion of that went to businesses in the state of Mississippi,” he said.
Regions Bank has distributed $2.8 billion in the first phase, while Citizens National Bank had awarded more than $100 million.
Loans from Citizens National have helped save more than 12,500 jobs, according to Jeff King, president of Citizens National’s West Region.
“Here in metro Jackson, we awarded $15 million in loans to 93 small businesses, which helped retain 1,665 jobs,” he said. “Those loans ranged from $1,500 to $2 million.”
King credits bank employees for helping get the funds out there. “We had people working 4 a.m. to midnight at our credit and loan operations office. In the first round of funding, we often had applications submitted and approved on the same day. We’ve had many customers compliment us on how quickly they were able to apply for and receive their funds.”
PPP is one of several assistance programs put in place as part of the federal government’s COVID stimulus efforts.
The first round included nearly $350 billion in low-interest loan funding, while the second round included $175 billion in loans.
As part of the program, the loans can be forgiven, if they are used to cover payroll costs, most mortgage interest, rent and utility costs incurred in the eight weeks after the loans are made, according to U.S. Department of the Treasury.
Through May 3, more than 2.2 million loan applications had been made since the second round of funding became available on April 27, according to American Bankers Association Banking Journal.
Banks essentially serve as a conduit, getting the money from the government to businesses.
For their troubles, the loans carry a one-percent interest rate, which the banks, not the federal government, receive.
“This is a top priority for us to address the incredibly large volume of applications,” said Robert Laird, Metro Jackson Market Executive for Regions.
“We’ve stood up new processes and have brought in resources from virtually every business unit to help validate and certify applications and get them submitted to the SBA for authorization,” he said.
Laird said Regions is taking other steps to help customers as well, including offering new opportunities for credit, as well as payment deferrals. “Folks are dealing with unprecedented times. We have seen opportunities to make accommodations for our customers and provide needed relief.”
Meanwhile, the financial institutions have been challenged with learning new regulations for the SBA loans, which have been changing in some cases overnight.
“Last week, the treasury put out new guidance at 9 p.m., and we implemented it the next morning,” said Dawson Graves, a loan officer at First Commercial Bank.
Graves said the toughest part has been going back to customers to ask for additional information, after he and they thought applications had been completed.
Through April, First Commercial had processed some 218 applications, about six times more than the bank normally processes each month.
“For the most part, everyone has been very patient and very understanding,” he said, adding that the state’s SBA office has helped him in better understanding the regulations when needed.
At Citizens, King said the senior management team, and officers from the bank’s credit department, “devoted themselves to reading through and interpreting’ the changing regulations.
Said King “Many changes from the SBA came out after 6 p.m. in the evening, and our management team spent time studying these after hours, and first thing in the morning, shared the changes with all our lenders.”
