More on Citigroup
|Bank Stock Buzz: Citigroup |
Goldman Sachs announced a $500 million program to support small businesses last fall, but it turned out to focus mostly on expanding business education rather than offering tangible financial help. More promising is the revival of CIT Group ( CIT), which many small and mid-size businesses depend on for financing. The company's bankruptcy last fall fostered fears that the company's small-business lending would evaporate. That doesn't seem to have happened: After restructuring its debt, CIT emerged from bankruptcy relatively quickly and made a profit in the first quarter of 2010. Also encouraging was JPMorgan's announcement that it would double its small-business lending in 2010. The bank said businesses with up to $20 million in sales would be eligible to apply for the earmarked funds, although the majority of new loans would be targeted to companies with less than $10 million in sales. To facilitate those loans, JPMorgan hired an additional 325 small-business bankers and set up a dedicated phone line for customers whose loan requests have been declined; applicants can speak to a credit expert to find out what steps they can take to secure a loan in the future. Overall, funding for small businesses is increasing, even if it's a trickle rather than a flood. The loans are there, but will borrowers come?