COMPLIANCE AND BSA

A PPP loan application is not considered a “completed application” under Regulation B until a creditor receives a loan number from the SBA or a response about the availability of funds.

Therefore, the 30-day clock for Regulation B’s notification requirement does not begin to run until the creditor has received confirmation from the SBA that the loan is guaranteed.

Like all other loans, Regulation B requires creditors to act with “reasonable diligence” to collect the information required to complete PPP loan applications in a timely manner.

Yes. An adverse action notification must be provided to the loan applicant within 30 days of the bank’s decision not to grant credit. The applicant must be given the specific reasons for the credit denial or notice of the right to receive the reasons.

No. Under Regulation B a loan may be denied for incompleteness only if the information provided by the applicant is incomplete and the creditor lacks sufficient information to make a credit decision.

If a bank has not received a loan number or a response about the availability of funds from the SBA, they may not deny a loan for incompleteness, nor may they provide the applicant a notice of incompleteness under 12 CFR § 1002.9(c)(1)(ii).