President Trump Signs Bill to Improve SBA 7(a) Loan Program
June 22, 2018
President Trump yesterday signed into law an ABA-backed bill to strengthen the Small Business Administration’s oversight of its loan programs and increase maximum lending authority. Championed in the Senate by Sens. Jim Risch (R-Idaho) and Jeanne Shaheen (D-N.H.) and in the House by Reps. Steve Chabot (R-Ohio) and Nydia Velazquez (D-N.Y.), the bill passed the House in May and was approved by the Senate earlier this month.
The bill strengthens the SBA’s office of credit risk management; enhances the SBA’s lender oversight review process; requires SBA to detail its oversight budget and perform a full annual risk analysis of the program; and clarifies factors that must be considered under the “credit elsewhere” test that lenders perform before applying for 7(a) financing.
“SBA programs are an important part of business lending for many banks, helping to fill a critical gap, particularly for early-stage businesses that need access to longer-term loans,” said ABA President and CEO Rob Nichols in a statement thanking the president and lawmakers. “This bipartisan bill will help strengthen oversight of the SBA’s loan programs while providing the SBA with the flexibility it needs to help ensure its strength into the future.” Read Nichols' statement.