Worcester Business Journal

www.wbjournal.com September 12, 2016 • Worcester Business Journal 15 What's important to Robert: R A banker who understands small businesses R An account with more perks and benefits An account with more perks and benefits R A way to deposit checks right from his garage A way to deposit checks right from his garage ...so he can keep running on all cylinders. ...so he can keep running on all cylinders. ...so he can keep running If it's important to you, it's important to us. From solutions that save you time and headaches to accounts that save you money, Webster Five helps small businesses accelerate their growth. Come in for a test-drive. web5.com/business Each depositor is insured by the FDIC to at least $250,000. All deposits above the FDIC insurance amount are insured by the Depositors Insurance Fund (DIF). KHJ22862_WEB-305_BizBanking_Print_6.5x8.5_Robert_DIF_MECH.indd 1 8/29/16 8:35 PM >> B A N K I N G & F I N A N C E In May, the bank expanded its small business reach through an acquisition of 44 Business Capital, LLC, a top SBA loan originator in Pennsylvania, New Jersey, Delaware, Maryland and Virginia. "We saw a lot of the bigger national banks pull out of secondary and tertiary cities, and we saw other banks close," Rice said. "Really the SBA program is a terrific program – it allows us to harness local business owners in our communities." Part of the growth comes from inte- grating the SBA programs holistically into business, Rice said. "What a lot of banks have done is they treated SBA as a siloed product, maybe had one specialist in the company. But at our bank everyone does SBA," he said. Serving the underserved In Central Massachusetts, Berkshire Bank closed 23 SBA loans so far in 2016. Thirty-six percent of those firms are either female or minority owned, said Brian Ferris, vice president busi- ness banking officer at Berkshire Bank. A desire to reaching out to under- served populations is one of the main reasons the SBA launched the fee waiver for loans under $150,000, Nelson said. In Worcester County, SBA lending to woman-owned businesses is down 16 percent so far for 2016, though there's still time to make that up. Lending to veteran-owned businesses jumped 157 percent over that same period, and the total dollar amount of loans to minority- owned businesses jumped 80 percent. "During the economic crisis, it was an extremely challenging credit envi- ronment for underserved markets," Nelson said. "The SBA fee incentives certainly increased our loans." Providence-based Citizens Bank, which has 25 locations in Central Massachusetts, increased its amount given out in loans in Massachusetts by 177 percent between 2014 and 2015, according to the SBA. Its story is similar to Berkshire Bank – a small business lending initiative was launched three years ago, and the bank now has SBA specialists spread out throughout its entire footprint, which includes 11 states. As of Sept. 1, Citizens Bank issued 186 SBA loans totalling $25.8 million in Massachusetts alone for 2016, a 90-per- cent increase in volume over the same period the year prior, when the bank issued 97 loans totaling $14.3 million. "It allows us to help more customers and prospective customers," said Kevin Ferryman, head of SBA lending at Citizens Bank. "It just allows us to bring a more holistic approach to lending for our clients." The right path At the Massachusetts Small Business Development Center Network at Clark University, small businesses can receive free, confidential consulting – whether they're just getting started or moving to the next phase of their business plan. The center sees between 700 and 1,000 clients per year, said John Rainey, the center's regional director. "What's happening is some of the banks are better educated on loan pro- grams that are available. The SBA is get- ting better," Rainey said. "If I looked at the SBA 22 years ago, I think loans have become much more flexible." Still, not every company needs an SBA loan, Rainey said. Sometimes banks assume risk by lending them- selves to a business, depending on the situation. But for some companies, there is more risk, so banks will want the SBA guarantee, he said. Although lending has increased, vol- ume at Rainey's office has actually decreased. That's because people tend to start their own businesses or find employment for themselves during bad economic times, he said. What Rainey is seeing is fewer new businesses and more people looking to expand or buy an existing business. "They're still the same loan group, but the amounts are usually larger if you're an existing business and you're purchasing ... equipment or real estate," he said. n Linda Townsend stands at the historic Nathan Fisher House in Westborough. The house is part of the future site of her business, Release Well-Being Center, which she financed through an SBA loan. P H O T O / N A T H A N F I S K E

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