Many businesses, scared of running up debt as sales fell, stopped borrowing during the economic downturn. The same NFIB survey suggests that loan demand hasn't rebounded, even as short-term interest rates have fallen. About 30 percent of survey respondents are borrowing regularly, down from about 35 percent at the beginning of the recession.

Cash has flooded into banks even as the amount of money on loan has fallen. Among Mississippi commercial banks, the ratio of loans to deposits fell to 75.5 percent at Dec. 31, the lowest level in more than a decade, according to FDIC figures. The ratio of loans to deposits is even lower at BancorpSouth, with its $8.5 billion in loans equal to only 63 percent of deposits. At the end of 2007, as the real estate boom imploded, BancorpSouth had $9 billion in loans outstanding, equal to 90 percent of deposits.

BancorpSouth says it will work with the Mississippi Development Authority and the Mississippi Business Finance Corp., as well as with the U.S. Small Business Administration. The SBA ranked Regions as No. 10 and BancorpSouth as No. 11 among large banks nationwide making small business loans under $1 million in 2010-2011, the most recent reported year. BancorpSouth's small lending was heavily concentrated in loans between $100,000 and $1 million.

With bad commercial real-estate loans leaving a sour taste, banks have fought heavily to lend to businesses for other purposes, such as equipment leases.

"I think this is an attempt by BancorpSouth to compete for any good Mississippi loan we can uncover," Darnell said.

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Follow Jeff Amy at http://twitter.com/jeffamy

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