By Monday evening, more than 75,000 small business loan applications were processed nationally as part of the federal government's efforts to allocate $2 trillion to help local business owners cover the cost of rent or compensate employees. A Utah bank that serves Logan, Central Utah, and Davis, Weber and Salt Lake, areas as well as St. George has processed more than 1000 loans in one and a half business days. Approval of these loans mean $250 million dollars will go to support Utah businesses dealing with the impacts of COVID-19 restrictions.
Kerry Bringhurst: George Danes is chair and CEO of Cache Valley Bank. He joins me along with Craig Maughan. Gentlemen, there were some delays Monday for all banks trying to assist in loaning money to small businesses. After all, this is a pretty big job for you in the industry, as well as the Small Business Association (SBA).
George Daines: With the current present burn rate, the program is allocating roughly $1 billion dollars an hour, Kerry. So at that rate, the money that has been appropriated will be used in approximately 300 hours, or 10 to 11 days. Why not come in now get your application done? So your money is locked in so you don't have that one more thing where you hope they come up with more money.
Kerry Bringhurst: How likely is it that the federal government might be willing to add additional money for additional SBA loans after the June 30 deadline?
George Daines: There have been comments by U.S Treasury Secretary Steven Mnuchin and other congressional leaders that they may need to add more money to this program and that they may consider extending the time period. But I'm reluctant to tell anyone to rely on that because it's just uncertain at this point.
Kerry Bringhurst: Let's talk about today. I assume your staff will be processing more requests,
George Daines: Craig, I presume you're down there and right in the middle of it, right?
Criag Maughan: Yeah. So we have people working from home and we have people working in the office. We were here until about midnight last night to try to get these done for the small businesses and try to get the funds they need through this program. And for a lot of us, it's one of the most rewarding things we've worked on, to call somebody and tell them their loans been approved. You know, there's always a sigh of relief on the other side, knowing that they're going to have the money they need.
Kerry Bringhurst: Once they have received word of the loan, and decide they want to take advantage of that, how long before they might see that money.
Craig Maughan: Our ultimate goal durimg phase two is to be able to get the loan approved and get the money to the person within 24 hours. Where it's a new program there are a lot of kinks that we are working out still. I think initially it's probably three to five days on the turnaround for the money. We're hopeful that we can get it down to 24 hours.
Kerry Bringhurst: George, maybe you can explain what a small business owner or a nonprofit can do when they don't necessarily have the information to complete these applications. Is it is it best to go to an accountant?
George Daines: We'll pay the accountant out of the money we're paid to do the processing. And, frankly, when we get the forms filled out by an accountant, we can process much more quickly. We can rely upon their measurements. It won't cost you anything. And frankly, the local accountant, the ones we've talked to, are anxious to help their customers.
Kerry Bringhurst: You have talked a bit about the banking industries and how they're helping with the distribution of these loans from the federal government. You've also mentioned how accountants are willing to help out these small businesses. And from what I understand you're also concerned about the health care providers,
Geroge Daines: We see what they're doing in harder hit areas, the doctors and nurses who are going into work when they know they themselves might be impacted. And we just believe everyone should be supporting them and helping them. There is interest earned on these notes. We've agreed that any interest that Cache Valley Bank receives as a result of this program will be distributed to hospitals and health departments in the areas in which the notes occur. So, in Ephraim and Loa, it will go to the hospitals in that area. In Logan, it will go to the hospital in Logan. In St. George, it will go to the hospitals in St. George. We will see that those entities get all of the interest we earn on this program from day one.
Kerry Bringhurst: Gentlemen, thank you for helping us better understand the Paycheck Protection Program loans through the SBA to help small businesses and charities, and to explain how local banks throughout the state of Utah and nationally are playing a role in making that money available. That was George Danes, Chair and CEO of Cache Valley Bank, along with Craig. Thank you both.