Fed Chairman, Governor Address Small Business Credit
Improving credit flow to small businesses is crucial to economic recovery and to restoring communities damaged by foreclosures and job losses, Federal Reserve Chairman Ben Bernanke and Fed Gov. Elizabeth Duke said in recent speeches. Both spoke in Washington, DC, at a meeting named "Addressing the Financing Needs of Small Businesses," part of a series of meetings sponsored by the Federal Reserve.
Conditions tight from coast to coast
Solving those problems belongs at the top of the Fed's current policy challenges, Bernanke and Duke said. "I wish I could conclude this wrap-up with a list of the three or four things we could do to immediately unlock small business lending," Duke noted at the end of her July 12 remarks. "But the problems are numerous and complex and they will require creativity and persistence to solve."
Citing a host of difficulties
Acknowledging small business's big role
"The Federal Reserve has worked assiduously with the other banking regulators to develop interagency policy statements on this issue, aimed at both banks and examiners," Bernanke said. "Our message is clear: Consistent with maintaining appropriately prudent standards, lenders should do all they can to meet the needs of creditworthy borrowers."
He pointed out that the Federal Reserve helped bring capital from the securities markets to small businesses through the Term Asset-Backed Securities Loan Facility, the TALF program. More than 850,000 small business loans were financed in part by securities whose issuance was supported by TALF, he noted.
July 29, 2010