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North Bay Business Journal

Monday, May 19, 2014, 6:35 am

Dollar volume of North Bay SBA loans dips, but number of loans up

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    The dollar volume of North Bay small business loans backed by U.S. Small Business Administration decreased 6.7 percent comparing the first half of the administration’s fiscal year to the same period in the prior year, while the number of loans ticked upward, according to data from the SBA.

    North Bay SBA 504 and 7a loans in Q1-Q2 fiscal 2014: North Bay, $47.8 million; Sonoma, $28.2 million; Solano, $11.9 million; Marin, $6.9 million; Mendocino, $455,000; Lake, $270,000Lenders approved $47 million in both 7(a) and 504 loans — the two most popular SBA programs — across Sonoma, Marin, Napa, Solano, Mendocino and Lake counties in the six-month period ended March 31. There were 86 loans completed during the period, up from 83 loans in the first half of the prior fiscal year.

    Sonoma County saw the greatest share of that activity in both dollar volume and number of loans, with $28.2 million in lending across 46 borrowers. That compares to $17.9 million in loans and 48 borrowers during the same period in the prior fiscal year — a 57.5 percent increase in dollar volume.

    Lenders funded $11.9 million loans across 18 borrowers in Solano County, with 18 borrowers and $6.9 million in loans in Marin County. Two Mendocino County loans accounted for $455,000 in borrowing, and a single Lake County loan totaled $270,000. There were no SBA loans in Napa for the period, according to the SBA.

    Accounting for the greatest share of 7(a) lending activity in both dollar volume and loans in the broader North Bay for the period was Wells Fargo, with 19 loans totaling $6.76 million. The San Francisco-based banking giant is an active participant in the government-backed loan programs provided under the SBA, and also ranked highest among lenders across California, according to SBA data.

    Santa Rosa-based First Community Bank lent the greatest volume of dollars in the region among North Bay-based institutions through the 7(a) program, with $4.45 million across five loans. The institution currently ranks 24th in dollar volume among the 200 active SBA lenders in California for the six-month period, according to the SBA.

    Exchange Bank, another active SBA lender based in the city, also completed five 7(a) loans in the North Bay at a value of $1.15 million. Santa Rosa’s Redwood Credit Union completed two of those loans in the region totaling $825,000.

    Oakland-based Bay Area Development Company was the most active on the 504 side. Its share of eight loans across the North Bay totaled $7.9 million.

    The various loan programs under the SBA provide a government-backed guarantee that helps mitigate risk for financial institutions lending to small business. Terms of those loans are typically better than the borrower could obtain otherwise, providing fixed-rate financing for business operations and expansion.

    The 7(a) program — the SBA’s most popular — is available for a variety of business needs. The 504 program, which combines a loan from a so-called “certified development company” with one from a traditional lender, is generally tailored for real estate and equipment.

    The San Francisco district for the SBA, which includes all nine Bay Area counties plus Santa Cruz, recorded 618 loans totaling $318.3 million for the period. Lenders provided $1.8 billion in financing across the state of California over the six months, with 3,370 loans.

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