U.S. Senator Joni Ernst (R-Iowa), Chair of the Senate Committee on Small Business and Entrepreneurship, is calling on the U.S. Small Business Administration (SBA) to review lenders recently removed from the U.S. Department of Agriculture's (USDA) flagship loan guarantee program and determine whether additional corrective action is necessary to protect taxpayers.
In a letter to SBA Administrator Kelly Loeffler, Ernst highlighted the recent failure of Community Bank & Trust – West Georgia, a lender that participated in both USDA and SBA lending programs. This lender partnered with nonbank affiliates, to launch an aggressive expansion of a nationwide SBA and USDA-guaranteed lending operation and came under regulatory scrutiny by the Federal Reserve.
"When a small community bank becomes a top SBA lender one year and fails the next, something went seriously wrong," Ernst said. "SBA must determine whether taxpayers were exposed to unnecessary risk and ensure bad actors are not exploiting federally guaranteed loan programs."
Source : senate.gov