WORKPLACE : More and More SBA Loans Going to Women-, Minority-Owned Businesses

The U.S. Small Business Administration just completed a record year, approving regular loans of $8.17 billion to 36,500 businesses nationwide. That was up 21% in loan volume and 36% in the number of loans from the previous fiscal year.

What share of those loans was garnered by companies owned by minorities and women? More than ever before.

Figures released Thursday show that 6,757 minority-owned businesses received SBA loans in the 12 months ended Sept. 30, up 60% from the previous year.

As a result, 18.5% of all SBA general business loans went to minorities--a record level.

Stanley Ock, chairman of U.S. Trading Associates Inc. in Santa Ana, is a beneficiary of the SBA program, which has surged amid a decline in conventional lending.

Ock, who emigrated from Korea in 1967, received a $300,000 SBA loan last month, which he used to buy a 6,500-square-foot warehouse. His 16-employee firm sells general merchandise imported from Asia, and he previously rented a warehouse in Santa Ana.

“I’m pretty much happy,” said Ock, a Laguna Niguel resident. “I save money on rent, and I own my own facility. It’s more comfortable.”

The number of SBA loans to female business owners rose even more sharply, to 7,211. That means women represented 20% of all the loans approved last fiscal year under SBA’s general business loan program. That, too, is a record and is a marked improvement from recent years, when women-owned businesses were getting an average of 12% of SBA loans, said Cassandra Pulley, SBA’s deputy administrator.

Still, Pulley noted that 20% isn’t nearly enough considering that women own 38% of all small businesses nationwide. “We feel we can do even better,” Pulley said.

In the latest fiscal year, loans to women-owned businesses were boosted by a new program in which nonprofit groups helped applicants assemble their loan materials and get pre-approval.

The number of business loans to women and minorities has also climbed because of greater marketing efforts by SBA-participating lenders. (The SBA guarantees 70% to 90% of general business loans of up to $750,000).

Alice Mack, branch manager of The Money Store in Irvine, says her four-person sales staff has tried harder to win SBA business from women and minorities. “We’re pushing for more,” she said. The Money Store is a financial services company that is the nation’s largest SBA lender.

Among minority-owned businesses, the number of SBA-guaranteed loans made in the past fiscal year to African American businesses surged 74% to 1,434. Those businesses received a total of $201.6 million in loans.

There were 2,427 Latino business owners who received SBA loans in the latest year, up 60% from a year earlier, for a total volume of $429.2 million.

The SBA approved 2,606 loans to Asian-owned businesses, up 54%. The total loan volume for this group last year was $854.2 million.

Native American-owned businesses received 233 SBA loans in the past year, up 64% for a total volume of $49.8 million.