Small Business Lending Oversight Act of 2016

Summary

Small Business Lending Oversight Act of 2016 This bill amends the Small Business Act to establish within the Small Business Administration (SBA) an Office of Credit Risk Management (OCRM) to impose specified administrative penalties, including monetary penalties, on any loan-financing lender that knowingly and repeatedly: fails properly to determine and document that a small business loan is eligible for financing, including failure to document that a loan is eligible because the applicant is unable to obtain credit elsewhere (from non-federal, non-state, or non-local government sources); sells the guaranteed portion of a loan when the loan proceeds have not been fully disbursed in accordance with program requirements; imposes on a loan applicant a fee that the SBA has not specifically authorized; or re-amortizes a loan solely to make the loan appear current. The SBA shall: conduct annual risk analyses of its loan portfolio, and assess a separate fee for each approved loan whose proceeds shall be used solely to support OCRM operations. The SBA shall also, at the end of each year, calculate the percentage of loans in a lender's portfolio made without a contribution of borrower equity when the loan's purpose was to establish a new small business concern, to effectuate a change of small business ownership, or to purchase real estate. No new loan application without a contribution of borrower equity, except in certain circumstances, may be approved if more than 15% of the lender's loan portfolio is without such a contribution. The SBA shall also make end-of-year calculations of industry concentrations for each lender. No new loan application to a lender from a small business concern operating in a single industry, except in certain circumstances, may be approved if over 20% of the lender's loans are concentrated in that industry. The SBA may not approve any loan if its financing is more than 100% of project costs. A lender may use an outside agent or lender service provider to assist in identifying potential applicants and with processing, disbursing, servicing, and liquidating a loan. With respect to an SBA loan for plant acquisition, construction, conversion, or expansion, including the acquisition of land, material, supplies, equipment, and working capital, as well as a loan to any qualified small business concern, no lender may sell or pledge an amount higher than 85% of the loan, or the percentage guaranteed by the SBA, whichever is greater.

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Documents

6 official files

• Reported to Senate (text)

  Reported to Senate · EN · 9 June 2016

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• Reported to Senate (PDF)

  Reported to Senate · EN · 9 June 2016

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• Reported to Senate with amendment(s)

  summary · EN · 9 June 2016

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• Introduced in Senate (text)

  Introduced in Senate · EN · 25 May 2016

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• Introduced in Senate (PDF)

  Introduced in Senate · EN · 25 May 2016

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• Introduced in Senate

  summary · EN · 25 May 2016

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