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SBA Increases Hispanic Lending

Industry ReportFiscal 2005 marks a record year for Small Business Administration lending across the state and the country. One highlight is a large increase in loan approvals to Hispanic-owned businesses. In New Jersey, they were up 49% from 2004.

“More New Jersey Hispanic small-business owners are gaining access to capital than ever before,” says William Manger Jr., administrator for SBA Region II, which comprises New York, New Jersey, Puerto Rico and the Virgin Islands.

The New Jersey district office approved for Hispanics 303 loans totaling $41.6 million in fiscal 2005, which ended September 30. That compares with 203 loans totaling $30 million for the fiscal 2004.

Manger says these loans were often used to start or expand such businesses as restaurants, construction companies, law and accounting practices, hair salons and motels.

Hispanics weren’t the only group to see an uptick in loan activity. The New Jersey office of the SBA guaranteed 731 loans to women under the 7(a) program for a total of $95.6 million, compared with the previous fiscal year’s 473 loans valued at $84.3 million.

Overall, in FY 2005 the New Jersey SBA district office approved 3,109 loans valued at $562.3 million through its flagship 7(a) program, which is used primarily for working capital. For 2004 the total was 2,267 loans worth $454.6 million. A smaller program, the Certified Development Company loan program, approved 64 loans totaling $44.2 million. This program is used to buy or rehabilitate fixed assets such as land, buildings and machinery and equipment.

7(a) Loan Program in N.J.

No. of Amount

Year Loans ($ millions)

FY2005 3,109 562.3

FY2004 2,267 454.6

FY2003 1,792 347.2

FY2002 1,877 414.6

FY2001 1,544 327.0

Source: U.S. Small Business Administration

7(a) loans do not include SBIC and micro loans.

Certified Development Co. Loan Program in N.J.

No. of Amount

Year Loans ($ millions)

FY2005 64 44.2

FY2004 52 38.8

FY2003 45 28.6

FY2002 20 15.0

FY2001 23 16.7

Source: U.S. Small Business Administration

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