Newtek Small Business Finance Funded Approximately $1.125 Billion of Paycheck Protection Program (PPP) Loans To Date
July 14 2020 - 8:30AM
Newtek Business Services Corp., (Nasdaq: NEWT), an internally
managed business development company (“BDC”), today announced that
Newtek Small Business Finance, LLC (“NSBF”), the Company’s
nationally licensed lender under the U.S. Small Business
Administration (“SBA”) Section 7(a) Program, has funded
approximately $1.125 billion of Paycheck Protection Program (“PPP”)
loans of its total pipeline of $1.145 billion of PPP loans with SBA
loan (E-Tran) numbers to date. NSBF estimates that upwards of
130,000 employees could be retained by NSBF’s PPP borrowers if
NSBF’s total potential funding of $1.145 billion of PPP loans is
reached. NSBF estimates it will fund in whole or part of its
remaining $20 million of PPP loans with SBA loan (E-Tran)
numbers. The PPP program is still ongoing and NSBF expects to
accept PPP loan applications through August 8, 2020. As of
Monday, July 6, 2020, there was in excess of $130 billion of
appropriation remaining for PPP loans.
Barry Sloane, Chairman, President and Chief Executive Officer
said, “Despite the headwinds the United States is currently facing
with regards to the COVID-19 pandemic and significant economic
contraction, the Company and its management team has sharpened and
narrowed its focus with the intent of being able to deliver results
to its shareholders during these trying economic times. The
tremendous media attention and its consistent discussion of
uncertainty relating to the pandemic has created a level of fear
and uncertainty in the economy, amongst its consumers and
throughout the investment community. With the current
backdrop, prior to our Q2 2020 earning’s release on August 5, 2020,
we felt it relevant to release certain key metrics to our investors
with respect to Newtek and the economy. NSBF funded and
closed $1.1 billion of PPP loans for the quarter ended June 30,
2020. We are currently estimating that by August 8, 2020,
which is the final date to apply for the current round of PPP
funding, NSBF will have funded and closed between $1.14 billion to
$1.16 billion of PPP loans. NSBF is beginning to rebuild its
pipeline of SBA 7(a) loans and will provide additional guidance in
this regard on our upcoming Q2 2020 shareholder conference
call. Based upon early commentary from Senator Ben Cardin of
Maryland, Senator Marco Rubio of Florida, officials from the
administration and a House Bill with $3 trillion of stimulus
passed, we believe that there may be additional rounds of PPP
funding available to businesses that have been affected by
COVID-19, with a continued focus on smaller business
clientele. It is hopeful that a draft of this legislation
will appear from the Senate within the next two weeks, as it has
already been a part of the recently passed House stimulus
bill.”
Barry Sloane continued, “Our portfolio company payment
processing metrics, which measure our portfolio of clients that
accept Visa, Discover, Mastercard and American Express, appear to
be rebounding. While our portfolio company payment processing
volume decreased year over year by 37% in April, 27% in May, and
14% in June, throughout the first 11 days of July, processing
volumes are flat to slightly down compared to the same period last
year. We believe this is indicative of robust consumer
spending even though many vital northeastern economies, as well as
an important geography in Miami-Dade County, Florida, still have
limitations on indoor dining and gyms. It is extremely
challenging to forecast economic opportunities in the immediate
future given the mix of information coming from federal, state and
local governments. The Company believes that it will be able
to sustain further roadblocks, setbacks and impediments to economic
viability and growth, and that it is well positioned to solve its
clients’ needs through government-sponsored financing,
state-of-the-art ecommerce solutions, and cloud-based technological
solutions to enable businesses to operate remotely with
flexibility. As legislation in Washington occurs regarding
future developments in the PPP and further support for the SBA 7(a)
program, we aim to keep our focus constructive, but cautious, as a
jagged recovery is anticipated to continue. We look forward
to reporting record adjusted net investment income for the second
quarter 2020 and other key metrics regarding our business portfolio
and opportunities going forward. We remain cautiously
optimistic about our business opportunities and future
prospects.”
About Newtek Business Services Corp.
Newtek Business Services Corp., Your Business Solutions
Company®, is an internally managed BDC, which along with its
controlled portfolio companies, provides a wide range of business
and financial solutions under the Newtek® brand to the small- and
medium-sized business (“SMB”) market. Since 1999, Newtek has
provided state-of-the-art, cost-efficient products and services and
efficient business strategies to SMB relationships across all 50
states to help them grow their sales, control their expenses and
reduce their risk.
Newtek’s and its portfolio companies’ products and services
include: Business Lending, SBA Lending Solutions, Electronic
Payment Processing, Technology Solutions (Cloud Computing,
Data Backup, Storage and Retrieval, IT Consulting), eCommerce,
Accounts Receivable Financing & Inventory
Financing, Insurance Solutions, Web Services, and Payroll and
Benefits Solutions.
Newtek® and Your Business Solutions Company®,
are registered trademarks of Newtek Business Services Corp.
Note Regarding Forward Looking
Statements
This press release contains certain
forward-looking statements. Words such as “believes,” “intends,”
“expects,” “projects,” “anticipates,” “forecasts,” “goal” and
“future” or similar expressions are intended to identify
forward-looking statements. All forward-looking statements involve
a number of risks and uncertainties that could cause actual results
to differ materially from the plans, intentions and expectations
reflected in or suggested by the forward-looking statements. Such
risks and uncertainties include, among others, intensified
competition, operating problems and their impact on revenues and
profit margins, anticipated future business strategies and
financial performance, anticipated future number of customers,
business prospects, legislative developments and similar matters.
Risk factors, cautionary statements and other conditions, which
could cause Newtek’s actual results to differ from management’s
current expectations, are contained in Newtek’s filings with the
Securities and Exchange Commission and available through
http://www.sec.gov/. Newtek cautions you that forward-looking
statements are not guarantees of future performance and that actual
results or developments may differ materially from those projected
or implied in these statements.
SOURCE: Newtek Business Services Corp.
Investor Relations & Public
RelationsContact: Jayne Cavuoto Telephone: (212) 273-8179
/ jcavuoto@newtekone.com
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