Small Business Loans on the Rise in Idaho, Utah and Zions Bank
More Idaho and Utah entrepreneurs are borrowing money to start and grow their businesses, according to the most recent fiscal year-end data from the U.S. Small Business Administration (SBA).
The number of approved SBA 7(a) loans, the most common type of financing offered by the SBA, increased 13 percent in the administration’s Utah District and 57 percent in the Boise District during the fiscal year that ended Sept. 30, 2015.
During the same period, the number of these loans approved by Zions Bank increased 29 percent in Utah and 71 percent in Southern and Eastern Idaho. The capital provided through Zions Bank’s loans to Idaho and Utah businesses allowed them to grow so that they could hire 1,755 new employees and maintain 2,938 positions, according to SBA data.
“Utah’s job growth is the highest in the country, and Idaho’s employment is also among the fastest growing in the U.S.,” notes Robert Spendlove, Zions Bank senior vice president and economic and public policy officer. “Zions Bank is proud that the SBA loans we made in 2015 are helping businesses create jobs that provide a foundation for economic growth and are essential to the long-term health of our communities.”
Another factor driving small business loan growth is the SBA’s waiver of guarantee fees on 7(a) loans of $150,000 or less, implemented in 2013. With the average 7(a) loan made by Zions hovering less than $203,000, many entrepreneurs are taking advantage of this perk. On a loan of $150,000, the two percent savings waived by the SBA could translate to two employees’ salaries for one month.
“The average size of the loans we’re making to small businesses demonstrates we’re meeting their appetite for modest leverage while still allowing them to grow and hire new employees,” said Cece Mitchell, senior vice president and Small Business Group division manager at Zions Bancorporation. “A year ago, we saw more businesses running lean and keeping cash on their balance sheets. So the shift we’re seeing in more small business loans in the state and at Zions reflects positive growth.”
In Utah, Zions Bank has ranked as the top provider of SBA 7(a) loans for the past 22 consecutive years. In 2015, Zions Bank approved 344 loans in Utah, totaling more than $72.1 million and representing 28 percent of the SBA-backed loans approved in the Utah District.
In Idaho’s Boise District, Zions Bank has been the top SBA lender for the past 14 consecutive years, having approved 106 SBA 7(a) loans totaling more than $15.9 million and comprising 23 percent of the district’s loans in 2015. In Northern Idaho, Zions Bank also approved 23 SBA 7(a) loans in the SBA’s Seattle/Spokane District totaling more than $5.8 million.
The SBA’s 7(a) program offers up to 25-year, fully amortized loans that may be used for most business purposes, including the purchase of real estate for business operations, acquisition of equipment, and working capital.