Huntington Bank has temporarily stopped taking application from companies seeking a U.S. Small Business Administration loan to get them through the economic hardship caused by the COVID-19 pandemic.
The Columbus, Ohio-based Huntington Bank — the largest SBA lender in Michigan and the U.S. — paused taking new applications for the Paycheck Protection Program “due to the unprecedented volume” of applications received since Friday so it could “focus on moving existing applications through the approval process.
“We have received applications totaling over $4 billion in requests and have secured nearly $2 billion in guarantees from the SBA in loans to customers in the first five days,” Huntington said Wednesday in a statement. “We will begin accepting applications again as soon as we can work through the enormous demand we have received and confirm that federal funding is available. We remain optimistic this important program will provide much needed relief to small businesses and we appreciate the unprecedented work by many to come together during this time.”
In Michigan, Huntington Bank has been the largest SBA lender annually by far for several years.
In the 2019 fiscal year, the bank wrote 1,048 loans for $143.2 million under SBA’s 7(a) lending program. The next bank was Chemical Bank at 78 loans for $48.3 million.
Through February of FY 2020, Huntington recorded 359 SBA loans in Michigan for $46 million, according to data from the SBA’s Detroit district office. TCF Bank, formerly Chemical Bank, was second at 30 loans for $13.1 million.
The enormity of the $349 billion available in PPP loans from the SBA and the massive need in the pandemic, combined with how fast the government put the program in place, it was likely that bottlenecks would occur, said Eric Seifert, the owner of Muskegon-based Left Coast Capital Resources LLC.
“Banks were unprepared, so they had to scramble, and the smaller banks just don’t have a lot of people to throw at it,” said Seifert, who’s been assisting small business owners applying for a loan.
“The demand is just enormous,” he told MiBiz earlier this week, before Huntington temporarily stopped taking new applications.