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COVID-19 Information for Commercial Lenders

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This page contains information, ideas and resources that may be helpful to your commercial lending efforts during this time of upheaval.

Paycheck Protection Program

The SBA has created the Paycheck Protection Program to provide relief for small businesses and nonprofits struggling to meet payroll and other expenses. Visit our Paycheck Protection Program page for full details.

MN/WI Small Business Grant

Some small businesses affected by COVID-19 in Minnesota and Wisconsin may be eligible for grants of up to $5,000. Click for details.

Background

As you know, the coronavirus outbreak has unfavorably impacted industries all over the world and sent shockwaves through the global financial markets. As the virus spreads, a growing list of companies large and small have warned markets about the adverse impact COVID-19 will have on their results and financial condition. It is highly probable that many businesses will generate lower earnings in the near term due to disrupted supply chains, manufacturing constraints and reduced consumer demand.

Lender Responses

Some lenders have chosen to proactively reach out to their borrowers, particularly those hardest hit by mandatory shutdowns, like restaurants, retail, manufacturing and even the multi-family sector as many American’s struggle to pay rent. Other lenders have chosen to wait for borrowers to come to them with a hardship, then provide some measure of relief. Whether one approach is better than the other is hard to say.

Resources

You may find these resources helpful during this unique period in business.

  • IRS Guide to coronavirus tax relief for businesses
  • SBA Notice of your ability to unilaterally provide temporary relief.
  • Video: Understanding the SBA Economic Injury Disaster Loan Program (EIDL)
  • Interagency Statement: Combined guidance from the FDIC, NCUA, OCC and other agencies regarding loan modifications for FIs whose borrowers are affected by COVID-19.

Relief Measure Ideas

These are examples of relief measures that lenders across the nation are taking to help borrowers:

  • Interest-only payments for three to six months
  • Deferred payments for three to six months
  • Interest rate reductions
  • Making CDs available to be withdrawn with no early penalties
  • Refraining from reporting late payments to credit rating agencies for 90 days
  • Offering small loans to cover mortgage payments for up to six months
  • SBA will allow payments to be deferred for up to six months
  • SBA has an emergency fund program in place.  SBA borrowers apply directly to SBA for assistance
  • Retail Property Owners with tenants unable to make their lease pay obligations ꟷ  Some FIs are asking for the tenants to provide the owners with documentation of their inability to pay, then the FI is offering payment deferment assistance

We’re Here for You

We appreciate the trust you place in us as a lending partner, now more than ever. Together we will navigate these murky waters and come out stronger on the other side. Please contact us anytime you have a question or need advice.