Banker says Trump’s PPP loans saved US business, and they’re back under Biden

Banks that give out forgivable loans from the federal Paycheck Protection Program (PPP) start taking applications this week from businesses and other employers, for the $147 billion in new funds approved by Congress and President Trump, plus leftover money from last year’s program.

“We’ll go live with more PPP loans” this week, said Vernon Hill, chairman of Philadelphia-based Republic Bank, which lent more than $700 million under the original program and its summer extension.

“We are not seeing the rush we saw last time,” said Chad Palank, Regional Manager for Business and Professional Banking at M&T Bank, which the SBA said made more PPP loans in the area than any other lender last year — 1,100, worth $443 million.

He said the bank has geared up to handle applications from people who aren’t already customers, as well as previous borrowers. New rules allow more nonprofits — even chambers of commerce and local business associations — to apply for PPP money, and make it easier for some restaurants to qualify.

The national PPP program in 2020 lent $525 billion (of an authorized $659 billion) to more than 5 million business borrowers, through banks and other lenders working with the federal Small Business Administration. Treasury secretary Steven Mnuchin said those borrowers employed more than 50 million Americans, suggesting the program helped prevent record unemployment.

Businesses can borrow up to $10 million, or two and a half times their payroll, whichever is lower.

A restaurant or hospitality business can borrow three and a half times payroll under new rules, a concession to owners’ complaints they could not cover food and other key costs under the original PPP program.

Businesses that borrowed last year can borrow up to $2 million more, if they used up the original loan. The SBA has set a new condition: Borrowers have to show their sales dropped at least 25% during a three-month period last year.