Small construction cos. top list of virus relief loan approvals
Construction firms have had a larger share of loans approved than other industries so far under a government program meant to help small businesses survive the coronavirus outbreak, and the average loan amount for all applications has been about $239,000, a new report shows.
The U.S. Small Business Administration on Tuesday released the most comprehensive report to date of the $349 billion Paycheck Protection Program, a cornerstone of the federal government’s $2.2 trillion response to pandemic. It details more than 1 million applications totaling $247.5 billion approved as of Monday.
As of late afternoon Tuesday, almost 1.2 million applications, totaling more than $268 billion, had been approved since the program launched April 3, according to the SBA’s latest totals. Funds for the program could be exhausted by Thursday, a top White House adviser said, but negotiations in Congress to replenish it remain stalled.
There’s no comprehensive accounting of how much money lenders have disbursed to small businesses so far. JPMorgan & Chase & Co. has funded $9.3 billion to firms and has more than 300,000 businesses in the application process representing $37 billion in loans, chief financial officer Jennifer Piepszak said Tuesday.
Construction companies received approval for 114,838 loans totaling about $34 billion through Monday, the SBA report shows. Professional, scientific and technical service companies were approved for 126,372 loans worth $30.3 billion, while holding companies had 2,278 loans approved totaling $888 million. Manufacturing firms had applications totaling $30.3 billion, and health care and social assistance firms $27.9 billion.
Loan applications from Texas, California, Florida, Illinois and New York accounted for nearly a third of the total amount, according to the report.
Tuesday’s report shows that 70 percent of the loans approved were for $150,000 or less, but they accounted for just 15 percent of the $247.5 billion in total approved lending. Almost 40 percent of that total went to loans between $1 million and $5 million, and about 10 percent to businesses that borrowed more than $5 million.
The program offers loans of as much as $10 million. They are forgivable if proceeds are used to keep workers on the payroll and cover rent and other approved expenses for about two months, a short-term stopgap designed to help businesses get by until the economy reopens.