The Minnesota office of the U.S. Small Business Administration said it backed 2,056 loans that totaled $681 million in fiscal 2017 that ended Sept. 30.
The dollar value was down slightly from the record $685 million underwritten by participating lenders in fiscal 2016. That was a big jump from $594 million in 2014.
Nancy Libersky, the Minnesota SBA director since 2010, said the state has moved up from the 12th in the nation in loan guarantees to the 10th largest out of 68 SBA district offices because of its growing relationship with lenders and small business centers that incubate emerging businesses.
“We have small businesses that want to grow,” Libersky said. “And we have many community lenders [working with the SBA].”
The bulk of the 2017 loans, $519 million, were made to 1,632 borrowers for working capital, asset financing and export support through term and revolving credit. About $162.5 million in credit was provided through the SBA “504” program for the purchase of longer-term assets, such as buildings and big-ticket equipment.
The biggest lenders, by number of loans, in Minnesota last year were Wells Fargo, U.S. Bank, Minnesota Business Finance Corp., TCM Certified Development Co., 21st Century Bank, Sunrise Bank and Anchor Bank.
Libersky said a growth area has been through eight nonprofit micro-loan intermediaries that make small loans to small, emerging concerns, often owned by women and minorities.
The SBA says its guarantees help lenders often offer more flexible terms to promising small enterprises.
Libersky said in an interview last year that: “SBA loans perform better than conventional loans because before the bank submits the application to SBA, the bank approves it internally, just as it would a conventional loan. Our processing center reviews the application again to ensure the requirements are met, data is correct and that financial information and the business is sound. The bank then offers a longer term and lower rate through our program.”