New $51 Million SBA Investment Fund In Reading, PA, for SBA Loans
This $51 million SBA investment fund, a public/private partnership, is expected to stimulate economic development in the City and to create jobs as local businesses receive the funds to expand and as new businesses are attracted into the area.
Fulton Bank has partnered with the City of Reading, Pennsylvania, the Federal Home Loan Bank of Pittsburgh and the Small Business Administration (SBA) to create a new SBA investment fund to benefit small businesses.
This innovative initiative, the Reading Family Business Loan Program, will encourage businesses to locate within the City of Reading and will help established small and family-owned businesses to grow by providing below-market rate commercial loans at fixed rates for terms up to 20 years using the FHLBank Community Lending Program.
Fulton Bank, an FHLBank member bank, has committed $25 million for this effort; in addition the Small Business Administration will participate with up to $20 million from the SBA 504 program for eligible small business borrowers. The private equity component from participating businesses amounts to at least $5 million. Additionally, Fulton Bank is providing $5.4 million for working capital financing, which allows persons carrying fixed asset financing to be eligible for tandem working capital loans. The City of Reading has contributed $540,000 to the effort. These funds will be used as a debt reserve for the working capital loan component of the program.
It's exciting, and gratifying, to see SBA and local funds joined to provide real services to city growth. The City of Reading has a great deal to be proud of in putting this together.
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