Santa Ana, CA – The U.S. Small Business Administration, Santa Ana District Office (SADO) announced FY16 lending numbers today showing record levels of small business lending nationwide through the 7(a) and 504 loan programs, as well as significant increases in lending to women, veterans and underserved communities. Borrowers in the Santa Ana District secured more than $1.4 billion across the 7(a), 504 and third party lenders in FY16.
7(a) Loan Program
SBA approved more than 70,000 loans in the 7(a) and 504 loan programs in FY16. These programs provided nearly $28.9 billion in financing to small businesses, supporting nearly 694,000 jobs.
SBA’s flagship loan program, referred to as 7(a), proceeds can be used towards a wide variety of legitimate business purposes including working capital, fixed and intangible asset financing, as well as refinance and export support, and can be structured as term loans or lines of credit. In FY16 the 7(a) program supported a record number of loans – more than $24.12 billion combined across 64,073 loans. Both the total number and dollar amount of 7(a) loans increased by 1 percent and 2.6 percent respectively over the previous year. SBA continues to streamline and improve access to its loan program for small loans and underserved markets delivering more than 44,000 small loans of $350,000 or less in FY16. In the Santa Ana District, 7(a) loans decreased nearly 5 percent in volume from last year’s figures.
The average dollar amount of an SBA loan dropped for the third year in a row, in line with agency efforts to incentivize the production of smaller loans. These “small” loans of $350,000 or less are most often sought by newly established businesses and businesses owned by individuals who are members of underserved communities.
Across the state of California, SBA loan production surpassed $5 billion for the second year in a row, with more than 10,000 small business borrowers financed by 233 participating lenders. California is a strong market for SBA lending, representing approximately 19% of all SBA loans originated in FY16. The top lenders in the Santa Ana District during FY16 were Wells Fargo Bank with 454 loans; U.S. Bank with 245 loans; and JP Morgan Chase with 131 loans.
According to J. Adalberto Quijada, Director, Santa Ana District Office, “The sustained demand for SBA backed loans over pre-recession levels is a signal of a strengthening economy. These loans are helping businesses to start and grow, creating jobs and providing a foundation for economic growth.”
SBA 7(a) Loan Program Ten Year Annual Statistics
504 Loan Program
504 loans provide small businesses with long term fixed rate financing to acquire fixed assets for expansion or modernization. 504 loans are available through Community Development Corporations (CDCs), SBA’s community-based partners. In FY16 the 504 loan program grew by more than 10 percent nationally to $4.74 billion, its third year of consecutive growth, and a 2 percent growth in loan volume. Reauthorization of the 504 Debt Refinancing Program in May was instrumental to the success of the 504 program in FY16.
504 Loan Program Ten Year Annual Statistics (Does Not Include Third Party Lender Portion)
504 Loan Data
Other Areas of Record Setting Lending
SBA lending had a significant positive effect on various underserved groups in FY16. Minority business owners received a record combined $8.65 billion in 7(a) and 504 financing. This record reflects the priority of the Administration and SBA in helping communities that historically find it difficult to access capital. In the Santa Ana District, minority owned businesses represented 875 out of 2029 borrowers, securing nearly $473 million in financing across both 7(a) and 504 programs.
For the fifth consecutive year, 7(a) lending to women-owned businesses (both majority and minority owned) increased in total dollar and volume. FY16 lending was nearly $7.3 billion nationwide, an increase of $253 million from FY15. In the Santa Ana District, women-owned businesses obtained $304.5 million in financing across both major loan programs.
Community Advantage loans provide up to an 85 percent guarantee on loans up to $250,000 and offers technical assistance to improve the rate of success among participants. This initiative grew by nearly 19 percent over the previous year nationwide.
Community Advantage Loan data
Small Business Investment Companies
To fuel high-growth small businesses and start-ups and drive innovation, SBA issued more than $2.5 billion in debenture leverage supporting more than $5.5 billion in investment to more than 1,100 small businesses. These funds helped to sustain nearly 112,000 jobs.
This program, which provides loans of up to $50,000 to small businesses through a network of nonprofit lending intermediaries, reached record levels again this year with 14 percent growth in dollar amount from $53 million to $60.57 million, and an increase in loan approvals of more than 18 percent.
The total number of SBA loans to veterans is up more than 4 percent over the previous year and for the second year in a row 7(a)/504 lending to this group surpassed $1.36 billion nationwide. Veteran owned businesses in the Santa Ana District secured 77 loans for a total of $34,216,800 in financing in FY16.
In FY16 SBA had another record year guaranteeing more than 1,800 small business export loans, which supported more than $1.5 billion in financing to small business exporters. Exporters in the Santa Ana District received 63 loans totaling more than $61 million.
In FY16, SBA’s Office of Disaster Assistance responded to 289 declared disasters across the country, including processing more than 59,150 home and 8,531 business applications and approved 25,235 loans for more than $1.4 billion.
For more information about SBA’s loan programs, financial assistance and other services, visit www.sba.gov.