Monday, May 10, 2010

Reps. Perlmutter, Coffman Introduce Loans for Main Street Bill Capital Access for Main Street (CAMS) Bill Will Free up Loans for Small Businesses

Washington, DC – While the U.S. added roughly 290,000 jobs in April, many small businesses still need access to loans and capital to avoid layoffs and start hiring new employees. U.S. Reps. Ed Perlmutter and Mike Coffman introduced a bill that would help these small businesses on Main Street get access to the kind of capital and loans they need.
HR 5249, the Capital Access for Main Street (CAMS) bill will temporarily allow small banks with under $10 billion in assets to amortize their losses on commercial real estate over a seven-year period. As a result, these small community banks, which provide many of the loans to our small businesses, will have more liquid capital available to make responsible loans.

“Small businesses are the engine of our economy,” said Perlmutter. “Their innovation and ingenuity will help our country continue to diversify, grow and prosper. Amortizing commercial real estate losses will enable our community banks to quickly extend capital to our small businesses and communities, which is critical to our economic recovery. In turn, these small businesses will be able to retain and hire new employees and make the important long-term, stable investments in our region, state and nation.”

“The real job creators in this country still aren’t hiring and our economy continues to suffer. A key to getting the wheels of job creation turning again is unlocking access to credit for small businesses. Our CAMS bill will help community banks begin lending to small businesses again and in turn will enable small businesses to obtain the access to the capital they desperately need to spur growth,” Coffman stated.

The TARP Congressional Oversight Panel estimated banks hold approximately $1.4 trillion in commercial real estate debt coming due over the next three years. The current rules require banks to write down all of this debt all at once, which reduces the bank’s available capital and impairs its ability to lend to small businesses.

Amortization was successful during the 1980s to deal with the significant strain banks experienced from the agriculture industry and helped the participating banks weather the storm.

Small businesses account for approximately 70% of all new jobs created, and this bill is designed to help them access new loans.

No comments:

Post a Comment