Small Bank Delivers Big Results for SBA Loan Applicants

The SBA’s “CARES ACT” promised a lifeline for small businesses affected by COVID-19. Yet for many owners, the loan process proved frustrating, time-consuming, and full of red tape.

An April New York Times article documented the struggles smaller companies faced during the first tranche of loan money: their applications ended up in a queue, behind those of larger, wealthier applicants. (According to Small Business Administration data, loans of more than $1 million made up just 4 percent of those approved, but comprised 45 percent of the dollars disbursed.)

Forbes corroborated

“Large banks have prioritized their lucrative clientele, while many Main Street businesses that need funding just to keep their people employed are waiting weeks for even a simple status update from their banks.”

The Forbes story called the second round “far from a knockout,” especially for those who had not applied during the Paycheck Protection Program’s first iteration. New applicants reportedly were put in line behind business owners who had previously applied, but did not receive funding.

For Lakeside Bank, the oldest and only locally-owned bank in Rockwall County, it was an opportunity to capitalize on its core strength: personalization.

“While we offer the same services as major institutions, we look at the market through a small bank lens,” says Lakeside President and CEO Paul Haney.

Every loan received the same priority, regardless of an applicant’s assets or account size.

To date, Lakeside has facilitated more than $22.5 million in loans to 184 businesses through the PPP — 84 percent of those loans totaling $150,000 or less. Many of the beneficiaries included companies in the architectural, real estate, and construction industries.

“I have been with larger banks for years, both personally and for business,” says Mark Haddock, managing partner of architectural firm Watermark Design Studio. When the first round of PPPs became available, he approached his current institution.

“They were of no help, unavailable to even speak with me on the phone,” says Haddock.  Upon contacting Lakeside, he was immediately connected to a bank associate. “The personal service was exactly what I needed. I was not just a number, but a relationship they wanted to keep.”

Funding was fast for Tucker Roofing Systems in Rowlett. “Lakeside walked us through the entire PPP application. I feel like I have a partner that’s on my team,” says owner John Tucker.

The bank has also been able to secure SBA loans for several independent realtors, including Ebby Halliday realtor Dell Osborn.

“You walk in and the bank president knows you.”

“As a Realtor, I like the individual relationships you develop with a smaller bank,” she says.

Two prominent Dallas non-profits also experienced the benefits of going local. For Dallas Zoo President and CEO Gregg Hudson, having its gates closed had a significant impact on the zoo’s bottom line.

“As a nonprofit, we rely heavily on ticket sales and donations. Lakeside Bank’s ability to deliver on our behalf was invaluable,” he says.

Dwell with Dignity, a nonprofit agency dedicated to creating homes for families struggling with homelessness, was also a recipient.

“We’ve been able to keep our entire small staff employed and actively engaged in transforming the lives of mothers and children who have fought their way out of poverty,” reports Executive Director Ashley Sharp.