Community banks across the country are capitalizing on the opportunity to win market share after some small business owners were dissatisfied with how their banks handled emergency loans.
After a negative experience trying to apply for a Paycheck Protection Program loan with their bank, some small business owners have switched to a smaller bank. The Small Business Administration's program helped community banks beat big banks on loan growth during the second quarter. Some community bankers said they were able to beat out larger banks by offering local decision-making and superior communication during the PPP process.
Year-to-date, community banks more than doubled their portfolios of commercial-and-industrial loans under $100,000 thanks to the PPP program, growing 107%. By contrast, banks with more than $50 billion in assets increased such loans by 18%.
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