FOR IMMEDIATE RELEASE
Washington, D.C. (July 21, 2010)-The Independent Community Bankers of America (ICBA) and 29 of its affiliated state community banking associations sent a letter to Senate Majority Leader Harry Reid (D-Nev.) and Senate Minority Leader Mitch McConnell (R-Ky.) today urging prompt passage of the proposed Small Business Jobs Act (H.R. 5297). In the letter delivered to all Senate offices, ICBA voices strong support for the Small Business Lending Fund (SBLF), while adamantly opposing counterproductive additions, such as Sen. Mark Udall's (D-Colo.) amendment to increase the lending powers of tax-subsidized credit unions. The SBLF legislation passed in the House last month and is pending a Senate vote this week.
ICBA and 29 State Banking Associations Urge Senate Passage of Small Business Lending Fund without Udall Amendment
"We urge prompt enactment of the Small Business Jobs Act with the SBLF and without the dangerous Udall amendment," ICBA and its state affiliated associations said in the letter. "The SBLF is the core component of this legislation and the provision that holds the most promise for small business job creation in the near term. Failure to even consider the SBLF in the Senate would be a missed opportunity that our struggling economy cannot afford."
The nation's nearly 8,000 community banks are prolific small business lenders with the community contacts and underwriting expertise to get credit flowing quickly to the small business sector. The SBLF is a bold, fresh proposal that would provide another capital option for interested community banks to leverage and expand small business credit. The $30 billion fund could be leveraged to provide as much as $300 billion of credit.
Under the act, interested community banks with less than $1 billion in assets could receive capital investments up to 5 percent of their risk-weighted assets, and those with between $1 billion and $10 billion in assets could receive up to 3 percent. The SBLF has important incentives to encourage greater small business lending by reducing the dividend rate community banks pay on the capital as they increase their lending.
"The SBLF proposal has all of the features needed to attract broad participation by community banks. We expect this credit to have a strong impact on the recovery and job growth and to provide greater tax revenues flowing back to the federal, state and local governments." ICBA said.
To read ICBA's letter, visit www.icba.org.