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Biz2Credit Small Business Lending Index for February 2012 Reports Loan Approval Rates Increase Slightly for Small Banks, Credit Unions and Alternative Lenders; Big Bank Lending Is Stagnant

The Biz2Credit Small Business Lending Index, an analysis of 1,000 loan applications on Biz2credit.com, found that approval rates of small business financing requests in February 2012 by small banks and non-bank lenders were up 0.1%, while credit unions increased 0.2%, still the highest in the past 12 months.

Meanwhile, lending at big banks remained unchanged at 11.7%, the figure reported in January 2012.

"Lending had a slight uptick in February. There is reason to be cautiously optimistic," said Biz2Credit's Rohit Arora, named "Top Entrepreneur of 2011" by Crain's New York Business and one of the country's top experts on small business finance.

"While the February jobs report was positive, we're not out of the woods yet. The rising price of oil will make both borrowers and lenders proceed with caution. Overall, the availability of small business capital has improved over the past 12 months, which is always a positive sign," Arora added.

Month 2011 Big Bank ($10B+ assets) Approval % Small Bank
Approval %
Credit Union
Approval %
Alternative Lenders
Approval %

February

11.9%

43.9%

49.1%

51.6%

March

11.6%

44.2%

48.8%

51.9%

April

10.4%

44.6%

50.1%

53.6%

May

9.8%

45.0%

51.2%

53.8%

June

8.9%

42.5%

52.3%

54.9%

July

9.8%

44.9%

53.4%

52.2%

August

9.4%

43.8%

54.2%

58.0%

September

9.2%

45.1%

55.5%

61.5%

October

9.3%

46.3%

56.6%

61.8%

November

10.0%

47.0%

57.0%

62.0%

December

9.7%

47.1%

57.4%

62.2%

January 2012

11.7%

47.5%

57.6%

62.4%

February 2012

11.7%

47.6%

57.8%

62.5%

Credit unions and alternative lenders approve more than 50% of loan requests. Small bank approvals are creeping up, while big banks still are tight, despite claims otherwise.

Biz2Credit also has found that banks with assets between $10- $50 billion are still very cautious when it comes to small business lending. They are continue to monitor oil prices, as well as the U.S. debt debate; big banks are more vulnerable to national and global events than smaller institutions.

Biz2Credit's analysis also found that loan request amounts ranged from $25,000 to $3 million; that the average credit score was above 680, and that average-time-in-business was slightly more than two years.
Unlike other surveys, the results are based on primary data submitted by more than 1,000 small business owners who applied for funding on Biz2Credit's online lending platform.