How The Big Banks are Working the System at Your Expense (1 Viewer)

[Dago]

Correct. Typically bills will direct a regulatory agency (like the CFPB) to create regulatory requirements and enforce after an effective date is established.

I work in banking compliance. I reviewed CARES to help lenders build a software application to process PPP apps online. Business lending in general has very little supervision. CARES did not add to this (Section 1102 of H.R. 748). Additionally, the SBA did not outline a process on how to process applications. The SBA only provided minimal guidelines to apply and process requests. It is kind of like the Wild West.

Another round of funding was just approved by the Senate and is expected to pass the House later this week. I believe that this round of funding will be spread out based on asset size. So if you are a smaller bank (under 10 billion in assets) you will get X dollars. 10-50 billion in assets gets X amount. This may help stem-off large banks dipping into funds, but won't solve the issue of how community banks and credit unions spread loan funds around.

My opinion is that the SBA should put in place certain processes to make things more transparent to the public before turning E-Tran back on to process applications. Reporting on PPP activity should be mandatory and made public as well. Having regulatory enforcement would be good and probably will happen in the future for business lending, but to establish an agency or direct a current one to take on enforcement is a massive effort.

Well there you go...it was a bi partisan fork up from someone involved in the process

Somehow I dont think we will see where those that have been blaming Trump will step forward and blame the Congressional members of their chosen party

 

[zeetes]

as i posted on the stimulus thread...Hancock Whitney took care of the larger accounts first. A company moving 10-20mm annually thru the bank vs 1-2mm annually go theirs and the 1-2mm got a "sorry PPP out of money" reply.

They went right to the larger commercial accounts to satisfy them and retain their business.

The smaller guys got nothing but " hey we need more documentation" - Client in Belle Chasse was asked EVERY DAY for 10 days for a new document. 10 straight days of thinking complete only to be asked for another document the following day. Delay delay til finally - oops out of $$$.

Our company applied- we compiled and submitted 211 pages of documents. No go.

Its actually quite simple...this was fraught with abuse ability from outset. It had zero oversight and no ability to reach the small mom n pops as intended. This was a simple cash grab for businesses that said " oh look free $$$"

And make no mistake. a 1% loan with first 6 mo payments deferred is NOT A PENALTY ( but the Fed Govt says it is ) lolol

its the difference between the haves and have nots. System is designed this way. Just as the market is.

IF you were around post Katrina, this should have come as NO SURPRISE.

i know for a fact one comepay they did. and thry are a major insurancd provider in baton royge.

 

[Dallas_Saint73]

Well there you go...it was a bi partisan fork up from someone involved in the process

Somehow I dont think we will see where those that have been blaming Trump will step forward and blame the Congressional members of their chosen party

This is a bi-partisan/Congressional failure for sure. At least from the perspective of having PPP funds disbursed to small businesses of all sizes. Both parties had a chance to add conditions to lend and fund PPP. Treasury could have directed the SBA to implement checks/balances but I am pretty sure the focus was on getting PPP out to lenders ASAP.

Here is a report from the SBA that slices and dices some of the PPP data- up until funds being exhausted on 4/16. It does not show approval by lender or business name, only as totals and by industry.

report--paycheck-protection-program-ppp-report-through-april-16-2020-12-pm-est

On a side-note, eligible lenders can pledge PPP loans as collateral to the Fed through a new facility (PPPLF) in exchange for a .35% loan based on the term and amount of the PPP loan. This gives lenders more liquidity to continue making loans (does not have to be PPP). So outside the origination fee paid by the SBA to the lender, the lender has incentive to then turn around and pledge the PPP loan as security for a new funding. The more PPP loans originated, the more can be sold on secondary market or pledged to Fed= the more money banks have to use for making new loans or using for other business purposes.

 

[bclemms]

Well there you go...it was a bi partisan fork up from someone involved in the process

Somehow I dont think we will see where those that have been blaming Trump will step forward and blame the Congressional members of their chosen party

I'm not a Democrat, far from it. Democrats tried to get more regulations in place but they were catching hell for "holding up the money". I'll be happy to pass the blame along to both parties though since they both suck.

 

[RKNSaint]

Our CFO filled ours out the first day which I believe was the 3rd. He had to redo it the 5th because they were all lost or whatever. Our banker held his hand and made sure it got done. We received confirmation and a prommissory note yesterday and funds are to be discharged tomorrow.

I'm not the biggest customer of the bank, but they do value us as clients.

From a bank's standpoint, I can easily see why they'd prioritize their clients with bigger needs as they get paid by size of the loan and their own downside if the larger clients fail is much higher.

I'm not sure why this is wrong or why it's surprising. I can see how it would suck if you weren't one of the big dogs or someone with at least enough clout for the bank to help you, but that's also what round 2 is for and thankfully that's been approved.

Let me put this another way.

They are trying to give away money as fast as they can with as few strings attached as possible all while not letting strippers, porn producers or drug dealers get any. That takes time. Frankly, it's amazing that it's been as quick as it has been, but with that quickness comes problems and future discoveries of fraud and misuse.

I think it's high time we grow up.

Grow up?

You got your construction company $ so easy to say that.

Companies and Ivy League schools flush with cash getting the handouts is fraudulent.


My issue is more with allowing banks to gate this. Of course they are going to jerk off their biggest clients.

 

[Loose Cannon]

Our CFO filled ours out the first day which I believe was the 3rd. He had to redo it the 5th because they were all lost or whatever. Our banker held his hand and made sure it got done. We received confirmation and a prommissory note yesterday and funds are to be discharged tomorrow.

I'm not the biggest customer of the bank, but they do value us as clients.

From a bank's standpoint, I can easily see why they'd prioritize their clients with bigger needs as they get paid by size of the loan and their own downside if the larger clients fail is much higher.

I'm not sure why this is wrong or why it's surprising. I can see how it would suck if you weren't one of the big dogs or someone with at least enough clout for the bank to help you, but that's also what round 2 is for and thankfully that's been approved.

Let me put this another way.

They are trying to give away money as fast as they can with as few strings attached as possible all while not letting strippers, porn producers or drug dealers get any. That takes time. Frankly, it's amazing that it's been as quick as it has been, but with that quickness comes problems and future discoveries of fraud and misuse.

I think it's high time we grow up.

*Gets paid*
*Brags about his company being special enough to get a loan*
*Looks down upon business owners who aren't "big dogs" and are watching their businesses fail as corruption and graft funnel all of the relief money to the rich and unethical*

...


*Tells everyone else to grow up*


"Shoulda pulled yourself up by your bootstraps, small businesses! Even though it was literally impossible for you to get a loan, and my company had their hands out for charity just like you did! Pwned!"



The Cliff's Notes of your post is "F you, I got mine".

You sir, seem like a bit of a prick.

 

[RKNSaint]

*Gets paid*
*Brags about his company being special enough to get a loan*
*Looks down upon business owners who aren't "big dogs" and are watching their businesses fail as corruption and graft funnel all of the relief money to the rich and unethical*

...


*Tells everyone else to grow up*


"Shoulda pulled yourself up by your bootstraps, small businesses! Even though it was literally impossible for you to get a loan, and my company had their hands out for charity just like you did! Pwned!"



The Cliff's Notes of your post is "F you, I got mine".

You sir, seem like a bit of a prick.

He sure seems to be. I had to un-ignore this guy just to respond to his diva post.

 

[TXSAINTFAN]

We're a small business, 20 employees.

SBA changed up some of the rules the night before this rolled out. We applied the 3rd. had to reapply the 6th because something on the app with our little community bank changed.

They came back to us two more times for more documentation. I thought for sure we would miss out. Finally got a confirmation the money was allocated.

Got funded today and I feel damn lucky to have it. Going to start bringing employees back Monday.

 

[dtc]

He sure seems to be. I had to un-ignore this guy just to respond to his diva post.

Take it however you like. I don't care.

The point was that I'm a mid-size customer of a small bank and they got ours done. Beyond that, I understand fully the reason that banks would select the biggest clients to get done first. The loss of their business or failure of their loans could kill the banks.

We were lucky to get in on the first round and the government is seemingly moving heaven and earth to give away money. That process isn't going to be fair, or simple and will be fraught with ill consequences.

 

[dtc]

Grow up?

You got your construction company $ so easy to say that.

Companies and Ivy League schools flush with cash getting the handouts is fraudulent.


My issue is more with allowing banks to gate this. Of course they are going to jerk off their biggest clients.

Yes, Grow Up.

Realize that a 2 trillion dollar giveaway run by anyone that's completed in 3 week

*Gets paid*
*Brags about his company being special enough to get a loan*
*Looks down upon business owners who aren't "big dogs" and are watching their businesses fail as corruption and graft funnel all of the relief money to the rich and unethical*

...


*Tells everyone else to grow up*


"Shoulda pulled yourself up by your bootstraps, small businesses! Even though it was literally impossible for you to get a loan, and my company had their hands out for charity just like you did! Pwned!"



The Cliff's Notes of your post is "F you, I got mine".

You sir, seem like a bit of a prick.

When I was at UT I noticed a definite arrogance and an inability of many to comprehend. Most of those people had frosted hair, boots and pastel knit shirts.

I'm sure it hasn't changed much.

 

[Dago]

When I was at UT I noticed a definite arrogance and an inability of many to comprehend. Most of those people had frosted hair, boots and pastel knit shirts.

I'm sure it hasn't changed much.

So that is where you got it from

 

[DaveXA]

We're a small business, 20 employees.

SBA changed up some of the rules the night before this rolled out. We applied the 3rd. had to reapply the 6th because something on the app with our little community bank changed.

They came back to us two more times for more documentation. I thought for sure we would miss out. Finally got a confirmation the money was allocated.

Got funded today and I feel damn lucky to have it. Going to start bringing employees back Monday.

Awesome, and good luck going forward!

 

[Loose Cannon]

Yes, Grow Up.

Realize that a 2 trillion dollar giveaway run by anyone that's completed in 3 week


When I was at UT I noticed a definite arrogance and an inability of many to comprehend.

Well, it's difficult to comprehend you when you're not even speaking in complete sentences.