The U.S. Treasury Department is helping a Bethesda bank provide more local small business loans. From Gazette.net, EagleBank of Bethesda has received $56.5 million from the Treasury as part of the 2010 Small Business Jobs Act, which is meant to offer capital to community banks with assets of $10 billion or less.
According to the CEO of EagleBank, Ronald D. Paul, the bank is able to obtain the money at an interest rate of only 1 percent because of the large number of loans it has given out in the past twelve months. In actual figures, the bank had an increase in qualified loans of $98 million. The bank has also paid back the $23.2 million it owed the Treasury Department from the banking crisis, and is just the sixth bank in Maryland to do so.
The good news for Bethesda and the Northern Virginia area is that more small business loans will be available to local institutions from a bank that already has increased loans by 26 percent since Q1 2010.
In addition to potential bank loans, the State Small Business Credit Initiative is distributing $23 million to other local programs including the Maryland Industrial Development Financing Authority and the Maryland Venture Fund. The latter invests in high-tech companies that are in early-state development. This money is another offshoot of the Small Business Jobs Act that is funding the bank loans.
All of this should translate to thousands of jobs becoming available for those who need or want them, according to state officials. EagleBank itself has added over 100 employees since last June. The hope is that these Treasury funds will turn into $230 million of loans to the private sector and provide a big shot in the arm for the local economy. So far it appears nothing will prevent that from happening.
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