Michigan small businesses were approved for more than $1.5 billion in federal loans during the first two weeks of the new Paycheck Protection Program the U.S. Small Business Administration launched earlier this month.
The SBA through Jan. 24 approved 1,371 PPP loans for Michigan small businesses, according to data released today.
Congress authorized the new $284 billion PPP round in a pandemic relief bill enacted and signed into law in late December. The loans are available to small businesses with 300 or fewer employees that can demonstrate a reduction of at least 25 percent in gross receipts in comparable quarters from 2019 to 2020.
Since the new PPP round opened, Grand Rapids-based Independent Bank has received 760 applications for a little more than $100 million, President and CEO Brad Kessel said today. Kessel expects the present PPP round to total about 40 percent to 50 percent of what the bank wrote in 2020, Kessel said.
Nationwide, the SBA as of Jan. 24 approved 400,580 PPP loans for $35 billion in the new round that began Jan. 11. Accommodations and restaurants accounted for nearly 20 percent of all loans nationally, or 45,785 for $6.52 billion. The construction industry was second with 14 percent of all loans at 38,825 for $4.95 billion.
The SBA takes PPP loan applications through March 31.
Fifth Third Bank was the second-largest writer of loans in the new PPP round nationally in terms of value at $539.7 million through 3,835 loans.
Michael Shepperd, the head of SBA lending for Fifth Third Bank, told MiBiz earlier this week that the bank had proactively reached out to clients on the new PPP round. Fifth Third early on saw “relatively significant” demand for PPP loans from restaurants and bars that in several states are still under restrictions.
“Obviously they’re still closed and they need these funds,” Shepperd said.
Nearly two-thirds of the total number of loans the SBA approved to date on the new round, or 262,778, were for $50,000 or less. Another 13.8 percent, or 55,356, were for $50,000 to $100,000, according to the SBA. The average loan size nationally is $87,000.
News coverage in the small business section of MiBiz is made possible by advertising support from the Small Business Association of Michigan. SBAM is the statewide and state-based association that focuses solely on serving the needs of Michigan’s small business community. This advertisement has no effect on editorial consideration in MiBiz.