Worcester Business Journal

4 Worcester Business Journal | April 13, 2020 | wbjournal.com C E N T R A L M AS S I N B R I E F Applications for $349B SBA bailout program push Central Mass. banks to the limit V E R BAT I M TJX furloughs "While we have been making decisions we would never want to make, we are living through a global pandemic. We are making every effort to prepare for re- openings, as soon as we believe we can operate safely in the communities we serve." Ernie Herrman, CEO of Framingham retail parent TJX Cos., in a letter April 7 detailing the furlough of U.S. and Canadian workers and executive pay cuts Healthcare donation "Words are not enough to express my sincere gratitude for this amazing gift from Fundación MAPFRE, who fully recognize that at this moment our frontline caregivers — like those all over the world — are our most valuable resource." Dr. Eric Dickson, CEO of UMass Memorial Health Care, on his hospitals splitting a $38-million worldwide donation from Spanish insurer MAPFRE to help fight coronavirus Nursing merger "We have created similar cultures within our agencies that will line up perfectly as our staffs begin to work together as a team. We felt that merging our agencies will create an organization that is poised to work effectively and efficiently." Elaine Fluet, president of GVNA Healthcare in Gardner, along with Jacklyn Fleming, executive director of the VNA of Southern Worcester County, in merging their organizations on April 1 F or banks certified as U.S. Small Business Administra- tion lenders, April 3 was a rush of activity for an industry more used to thoughtful and methodical transactions. e planning was still there, but no spare time once the SBA began accept- ing applications for the $349-billion federal relief program to help small businesses forced to close, drastically cut back operations or watch much of their revenue shrivel up because of the coronavirus outbreak. "ey've continued throughout the weekend and yesterday and today," said Peter Alden, the president and CEO of Worcester-based Bay State Savings Bank. "It's been brisk to say the least. at's an understatement." Banks first had to quickly understand the basics of the Paycheck Protection Program that was part of the $2-tril- lion stimulus bill known as the CARES Act. Representatives had to know the program themselves and to be able to explain it to clients. But that phase was rushed because the government itself didn't finalize the program's tenets until just before appli- cations were accepted. "We didn't know the final rule, like everyone else, until like 7, 7:30 ursday night," said Chris Watson, a senior vice president and senior business lending officer for Webster Five Cent Savings Bank. Webster Five entered about 120 applications into the SBA's approvals system as of around noon April 7, a rush magnitudes larger than what the bank would normally do for all of 2020. "A typical year, we're probably doing 20 through the SBA," Watson said. e program provides businesses with up to 500 employees with loans of up to $10 million to cover payroll, inter- est on debt service, rent or utilities. To help include employees who may have already been laid off, applications can be dated back to Feb. 15. e interest rate is 0.5%, and repay- ment is deferred for six months. e term of the loan is two years. e loan can be forgiven if employ- ers meet certain criteria, including demonstrating they used the funds on maintaining their workforce. Already, initial unemployment claims have soared to record highs nationally, with more than 6.6 million claims in the week ending March 28. In three weeks' time, Massachusetts unemployment claims have risen from 7,449 to 148,452 to 181,062, the latest number represent- ing nearly 5% of the state's non-farm workers. "is is going to be a great help for small businesses," said Mark O'Con- nell, the president and CEO of Hud- son-based Avidia Bank. Avidia got off to a slower start, with some online operational issues Friday. By April 8, the bank was about 20% through the upwards of 600 applications it received, with a hope to get through most of the rest before the end of the week. Existing Avidia customers are being processed first. "We're going full-bore here," O'Con- nell said, calling customers understand- ing of the heavy workload banks are facing. bankHometown of Oxford has been rushing to make sure employers can help get those workers back. More than 300 applications totaling nearly $45 million in commitments were processed through April 7, Robert Morton, the bank's president and CEO, said. at required eight employees working through Saturday and five on Sunday. "at's a huge number of loans for us to do," Morton said. "We didn't want our customers to get shut out from the funding." e rush was so swi that Natick- based Middlesex Savings Bank had to temporarily pause the process because of an overwhelming number of submis- sions. It planned to reopen the portal the morning of April 8. At UniBank in Whitinsville, CEO Michael Welch said the bank's entire retail, business and commercial banking teams were working throughout the weekend to get as many applications through the SBA system as possible. "So many in our community have been impacted by the effects of COVID-19 — themselves, their families and their companies, their employees or employers," Welch said. "As a local bank, we remain focused on serving the community where we live." Banks receive a notice virtually instantly whether a business is approved for Paycheck Protection Program, ex- ecutives said. But the next steps include getting the funding so banks can close the loans — and to get funds to com- panies relying heavily on the money to stay in business. Alden said he hopes checks can begin arriving within a week or two. at represents the next rush for banks. "It's not like we can set up 300 clos- ings in one day," Morton said, alluding to the next challenge but also expressing gladness at how the process has worked so far. "is has gone about as well as one could expect," he said. W BY GRANT WELKER Worcester Business Journal News Editor Avidia Bank's branch in Framingham

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