By Rebecca Ayers – Staff Writer, Dallas Business Journal
Apr 15, 2020, 9:31am EDT
The U.S. Small Business Administration’s Paycheck Protection Program could run out of money by this week or beginning of next week, Texas banking and government officials say.
The SBA has already approved Paycheck Protection Program applications that total $247.5 billion in loans, as of Monday, according to SBA data obtained by the Texas Bankers Association. The Coronavirus Aid, Relief, and Economic Security Act earmarked $350 billion in federally guaranteed loans for businesses with fewer than 500 employees for the PPP.
Texas led the country with the most approved PPP loans, having approved 88,434 loans totaling $21.77 billion, as of Monday. California followed behind Texas, having approved 54,922 totaling 20.85 billion in loans, as of Monday. Overall, the average loan size is about $239,152, according to the data.
Companies can qualify for PPP loans of up to $10 million. The loans carry a 1 percent interest rate and are designed to keep workers employed for eight weeks. A borrower can ask the SBA to forgive the loan and the interest if workers are not laid off.
Vista Bank’s President and CEO John Steinmetz said his bank has received more than 700 PPP applications that total about $94.35 million in loans. Vista Bank has processed 609 loans, he said. The Dallas-based community bank forecasts that the funds for PPP could run out between Wednesday and Friday, Steinmetz said.
Steinmetz said PPP is more than just a loan program: it’s a lifeline that allows small businesses to keep its hard-working employees and avoid unemployment. There are still many small business owners that maybe didn’t have an accounting firm, a CPA or CFO that are trying to get its applications together, he said.
“These are real people trying to keep real jobs, and they are the only way our community will come out of this with a fighting chance to get us back to some new normal,” he said.
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