May 15, 2009

Here's something you probably haven't heard a lot these days: Despite an industrywide credit clampdown, many banks have sustained their lending to small businesses, and some are even making more loans now than they ever did before.They aren't household names and they don't often show up on high-volume lender lists, but community banks and specialty lending companies have kept their coffers open even as the vault doors at bigger banks swing shut.

"Those that are doing SBA loans on the sidelines are more willing to walk away. In top commercial banks, SBA lending is not a big part of their business," says Bob Judge, Partner at Government Loan Solutions, a firm that analyzes activity on loans backed by the Small Business Administration. "But for others it's a major part of their business and if they pull out, their whole business would come undone."