After a rough start on Monday, the second round of the Paycheck Protection Program was running smoother on Tuesday. But with the application process ramping up, local lenders said they expect the $310 billion set aside for the second round to be exhausted in the next few days, possibly as soon as Wednesday.
"We will clean out [our] queue by the end of the day, and we've taken in some non-clients," said Bill West, president and CEO of The Bank of Tampa, said on Tuesday. "But we think the money will run out by tomorrow and we won't have the chance to do much more."
West said the experience on Monday was "horrible" and that the bank's staff was only able to process about 20 applications during the first eight hours of the second round.
"We had 12 or 13 people staring at blank screens from 10:30 in the morning to 7 at night," West said. But by Tuesday afternoon, the bank had processed 432 loans worth about $58 million, adding onto the $312 million the bank was approved for in the first round of PPP lending. West said bank employees worked through the night to secure the loans.
According to Tampa Bay Business Journal research, The Bank of Tampa is one of the top regional lenders for the Small Business Administration, which is overseeing the PPP.
Rita Lowman, president of Pilot Bank in Tampa, said the SBA restricted the use of robotic processing to enter loan applications after Monday's issues, which she said "seems to have helped." She said Pilot Bank employees also worked through the night and was closing in on having secured approval on 80 loans by noon on Tuesday.
Lowman said robotic processing was being used by larger banks to process the tens of thousands of loans they had received. "Smaller banks like ours manually input," she said.
Lowman believes the money will last a little longer than West predicted, saying the PPP fund would likely run out by the end of the week. She said the SBA was approving $3 billion per hour on Monday, which would pace the funds to run out by late Thursday or early Friday.
Jack Barrett, president and CEO of First Citrus Bank in Tampa, said he expected the funds to dry up in the next 48 to 50 hours. Like the other banks, he said First Citrus has been staggering shifts in order to process applications around the clock.
The PPP was created to provide funds to companies with less than 500 employees, helping them endure the impact of the Covid-19 pandemic. SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest or utilities.
When asked about PPP loans last week, several lenders were unsure whether a third round of PPP funding would follow once the second had run out. Lowman, who sits on the board for the Florida Bankers Association, said she expects a third round of funding, although details have not yet been discussed.
to view original article in the Tampa Bay Business Journal