Survey Obscures Top Small-Business Lenders

“State’s Small Banks Becoming Big Lenders to Small Businesses” (Feb. 13) underscores the importance of small-business lending. However, the conclusion that small- and mid-size banks account for more than half the dollars lent to small businesses in California is misleading.

The article’s primary source was a Small Business Administration study focusing on business loans of $250,000 or less and ranking banks according to a ratio based on the number and value of small-business loans, total bank loans, assets and deposits.

The problem with comparing small banks and big banks this way is that it obscures the performance of the state’s top small-business lenders. Those that make fewer loans are ranked higher, and those that make more loans are ranked lower. A table accompanying the article illustrates the irony. The table reveals that as of June 30, 1995, the SBA’s 10 top-rated banks in California had 6,235 small-business loans outstanding, totaling $214.5 million. Yet Bank of America, ranked No. 253 by the SBA, made more than eight times as many loans (52,733) for more than double the amount ($586 million).

Bank of America is deeply committed to small-business lending. If you use the federal definition of small-business loans and consider those of up to $1 million, you would see that B of A had $2.6 billion in small-business loans outstanding at the time of the study, making us one of the state’s leading lenders. We have streamlined our applications, reduced required supporting financial documents and cut approval time while adding relationship-based pricing to benefit our customers.

JERRY L. BOWMAN

Executive vice president

Business banking division

Bank of America

Pasadena