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Friday, Mar 1, 2024

City National to Help with Loan Fees

In the hopes of boosting small business lending, City National Bank said Tuesday that it will pay half of the standard fees associated with federally-backed small business loans.

The bank, a subsidiary of downtown L.A.’s City National Corp., will pay up to $3,000 toward U.S. Small Business Administration standard loan fees, which range between 2 percent and 3.75 percent of the guaranteed portion, for loan applications submitted by Sept. 10 and funded by Dec. 31.

Under temporary legislation passed in 2009, the SBA reduced or waived certain fees and raised its loan guarantee from 75 percent to 90 percent of the loan value, boosting SBA borrowing nationwide. But after the legislation expired earlier this year, lending dropped 70 percent.

“With SBA loan incentives having expired in May, small businesses remain hamstrung in their efforts to invest in and grow their businesses,” said Jim Wullschleger, City National senior vice president and business banking manager, in a statement. “And that comes at a time when small businesses – typically a key employment driver – have a vital role to play in our economic recovery.”

Congress is expected to consider an extension of the fee incentives when it reconvenes next month.

Shares of City National closed at $53.47, up 1.6 percent.

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