From the ArcaMax Publishing, Business News Newsletter:
http://www.arcamax.com/news/businessnews/s-641412-470502
BOSTON (UPI) -- Billions of dollars of U.S. bailout funds have gone to
pay down bank debt, rather than increase small business lending, a
leading economic analyst said.
Economic analyst Brian Bethune at IHS Global Insight said banks with
frozen assets clogging their books do not have the funds available for
lending, The Boston Globe reported Monday.
"They're not really anxious to do that sort of business," Bethune
said.
Bank of America, despite $45 billion in federal assistance, made 11
Small Business Administration 7(a) loans from September 2008 to
September 2009 in Massachusetts, compared with 54 the previous year,
the Globe said.
Citibank, whose parent company Citigroup Inc., accepted $50 billion in
federal funds, made eight SBA 7(a) loans in the state in the same
period, lending $2.4 million.
Central Bankcorp accepted $10 million in federal assistance, while
OneUnited of Boston received $12 million. Not even a temporary
suspension of a 2 percent borrowers fee could entice the banks to
write SBA loans, the newspaper said.
"That's what has a lot of people on Main Street angry. It doesn't
appear to them that bankers have suffered that much," said Cornelius
Hurley, director of Boston University's Morin Center for Banking and
Financial Law.