Small Businesses Will Benefit from Bank of America's Pledge

As most small business owners have noticed, small business bank lending is nearly frozen. However, Bank of America's Chief Executive, Ken Lewis, recently announced that Bank of America intends to increase small business lending by five billion dollars in 2010. This pledge was made after President Obama held a meeting at the white house with the chief executives of 12 of the nation's largest banks, banks that were part of President Obama's bail out plan. President Obama emphasized to the executives the "extraordinary assistance" the financial industry received from taxpayers.

In the past year, Bank of America, as well as most of the 22 largest banks involved in the bail out have cut back and shaved away much of their small and medium size business loans. The President informed the executives of these banks that there were too many businesses worthy of loans with good credit that weren't getting loans citing the various letters he had received from small and medium sized business owners. The banks all instituted a "second look" policy, promising they will go back over recently declined loans and give them a second look for possible approval. Bank of America defines small and medium sized businesses (the businesses they pledge to lend more money to) as businesses posting less than 20 million dollars in annual revenue.

Bank of America's Ken Lewis called small businesses the "lifeblood" of our country's economy, acknowledging the role they have in creating jobs. The President also acknowledged the power of small businesses when he asked all of the bailed out banks to reinvest in the economy by increasing their loans to small and medium sized businesses. Bank of America spokeswoman Anne Pace said, "We understand that small business owners have been especially hard hit by the decline in economic conditions. It's time to do more."