What Small Business Lending??

I read the annual reports on all the banks listed below and the information I was able to glean is presented in the table. There is a basic problem. Other than JP Morgan, nobody seems to want to disclose any real information about what they are doing in Small Business lending. Here is my disclaimer. I went through probably 1500 pages of pdf files. I know what to look for. I searched the terms Small Business and Business Banking in addition to looking through various tabular presentations. Most of the banks just lump their numbers into other numbers. So, it is possible I missed something. If you are with one of those other banks and would like to comment, I will gladly modify my information. Since some large banks present their loan numbers but not deposit numbers, I had to make an assumption. I assumed that the proportion of small business deposits to total deposits is the same for all the banks as it is for JPM. I know that can’t be right, but it is probably close for banks with substantial retail branches.

As you will see from the data, even if I am wrong by a factor of 100%-200%, the conclusions are the same. Big banks are not focused on Small Business lending.

As I said after the Warren Report came out, we need a Marshall Plan for Small Business credit. The SBA is not the answer. The banks need to get focused. It is interesting that all four of the largest banks, and lets face it, those are the ones that matter, have close to the same dollars in small business loans. In each case, I would think a respectable goal would be to take their small business lending up to about $100 Billion from the mid teens. That would bring their small business loan to deposit ratio up to about 1/3, give or take.

The question can also be asked, “WHAT ARE YOU DOING WITH THE OTHER TRILLION???”

Chart: Small Business Lending
Source: What Small Business Lending??

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