Independent Banker - June 2020 - 54

days after the launch, many banks were still struggling to
gain access due to outdated and hard-to-use systems, which
ultimately hurts the small business owner, Bolton says.
" There is no more helpless feeling than having everything
ready to help your small business customer, " he says, " but
you can't gain access to a system because your password is
locked, and you can't get anyone to help you. "
Community banks generally experienced overwhelming
demand. However, the initial appropriated PPP funds were
" We're using technology
and electronics
wherever possible but
not forgetting the human
touch or human side of it. "
-Aleesha Webb, Village Bank
quickly depleted, and the SBA announced April 13 that it
would no longer be able to accept new PPP applications
based on the initial $349 billion in funding.
Community bankers, who had inundated their
representatives with calls and emails (see Checks &
Balances on page 32), and their small business customers
breathed a sigh of relief when another $310 billion was
made available in late April. Advocacy by ICBA and its
members also secured a set-aside reserve for community
banks, meaning at least $60 billion of the second round
of funding would be available exclusively for
community financial institutions.
On the downside, the application process at the
beginning of the second round was again beset by
glitches, making for a frustrating experience for
community banks and their customers.
Low rate environment
The other dynamic that community bank lenders
are dealing with are aggressive rate cuts by the
Federal Reserve that reduced the federal funds
borrowing rate to nearly zero as of early April. That
created very low financing rates for both consumer
and business borrowers who may be looking to
refinance debt and lock in low rates on fixed-rate
loans-if they can get approved.
Generally, the early focus has been " battening
54 Q ICBA Independent Banker Q June 2020
down the hatches, " Schneider says. That said, Investors
Community Bank is helping customers with trying to
lock in longer-term, lower-cost funding, if possible. For
example, the community bank is a large ag lender to
Wisconsin's dairy industry, which has been a victim of the
ripple effects of COVID-19. Lenders have been working
to lock in longer-term, lower-cost fixed rates for those ag
loans, as well as helping those clients qualify for the PPP.
The residential mortgage market has seen a surge in new
business. " Marquette [Bank] has experienced a significant
uptick in both new residential mortgages and refinance
opportunities due to low interest rates, " Edwards says.
" To make it easier for our customers to ask for assistance,
the bank has streamlined processes and promoted the
availability of an online form to request 90-day mortgage
payment deferments, " adds Ed Drexler, senior vice
president of residential lending at Marquette Savings Bank.
Looking ahead to long-term solutions
While lenders are helping customers survive the shortterm
disruption, they also want to help them find solutions
beyond the first few months. In Wuhan, China, the site of
the original outbreak, the government lifted stay-at-home
orders after 76 days. If the U.S. follows a similar path, it's
likely that restrictions on mobility and business traffic will
not resume until early June in many areas of the country.
Beyond the PPP, bankers are helping customers access
other financing options and products. For example, the SBA
previously offered an Economic Injury Disaster Loan (EIDL)
program, which provided long-term, low-interest loans to
qualifying businesses. States have also introduced targeted
relief programs to qualifying businesses and nonprofits.
" Right now, the SBA has some amazing programs set
Independent Banker - June 2020

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