2015 SBA Secondary Market Outlook

Small Business Finance Institute

Coleman Report

Thanks for your interest in the 2015 SBA Secondary Market Outlook, which measured the expectations for SBA secondary market participation and success. For many lenders, loan sales drive the supply line for delivering small business capital. Please review the results below.

Charles Green
Charles H. Green

Bob Coleman
Bob Coleman

1. Does your bank sell the guaranteed-portion of SBA 7(a) loans?

Always     Sometimes     Never

  55%            35%               10

SBFI-Coleman Report-Does your bank sell the guaranteed portion of SBA 7(a) loans

2. What was the average premium paid for loans sold in FY 2014?

Avg. Sale Premium              Range

Loans w/ 1-7 yr. Maturities                                     4%                              13%-0%

Loans w/ 10-15 yr. maturities                                 8%                              13%-0%

Loans w/ 15-25 yr. maturities                                 11%                            18%-0%

 

3. For 7(a) loans, was the premium income satisfactory in 2014?

Yes     No     N/A

90%    0%    10%

 

4. What is the expectation of sale premiums to be offered for these loans in 2014?

Higher     Lower     Same

 10%         29%        61%

 

5. Has your bank ever sold the unguaranteed portion of its SBA 7(a) loans?

Yes     No     N/A

 6%     81%   13%

SBFI-Coleman Report-Has your bank ever sold the unguaranteed portion of its SBA 7(a) loans

6. If unguaranteed loans were sold, how was the transaction settled?

For Premium     For Discount     At Par

      30%                   7%                63%

 

7. What’s the most important reason your bank sells SBA 7(a) loans?

Premium Income     Bank Liquidity     Both     Neither

        65%                         3%               26%        6%

SBFI-Coleman Report-What's the important reason your bank sells SBA 7(a) loans

8. Does your bank use premium income as the basis for incentive compensation for any staff?

Yes     No     N/A

55%    42%   3%

 

9. Do you expect the Prime Rate to increase in FY 2015?

Yes     No     Don’t Know

 55%   29%        16%  

 

10. Does your bank use a third-party service provider to manage SBA 7(a) loan sales?

Yes     No     N/A

17%    80%   3%

 

11. If the secondary market for CDC/504 senior loans had more participating buyers, would your bank make more CDC/504 loans?

Yes     No     N/A

 57%   30%   13%

SBFI-Coleman Report-If secondary market for CDC-504 senior loans had more participating buyers, would your bank make more CDC-504 loans

 

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