A replenishment in the heavily criticized Paycheck Protection Program resulted in a firehose of small business lending from JPMorgan Chase, the financial institution said Friday.
JPMorgan, the largest US bank by assets and a target of recent PPP-related complaints, received approval for 211,000 loans totaling about $15 billion under the second wave of the US Small Business Administration’s coronavirus-relief program. That brings the total number of loans from JPMorgan under the PPP to 239,000, worth $29 billion, since the program’s launch in early April.
The vast majority were small in size and about half went to businesses with fewer than five employees, JPMorgan Chase said, noting that the average loan amount was $123,000 and more than 75% of the loans were for less than $100,000.
A JPMorgan spokesperson declined to disclose any further data about the company’s PPP loans.
The spokesperson said the company’s business banking division — which serves about 3 million business clients with under $20 million in revenue — received a far greater number of applications than its other commercial and dealer divisions, which serve a smaller subset of larger corporate clients.
“In the end, Business Banking received applications from over 38 times more customers than the rest of the firm,” Patricia Wexler, a company spokesperson, told CNN Business. “It was really this race against volume and time and just people resources.”
JPMorgan and other lenders have come under fire amid a broader outcry over the SBA program’s rollout. The $349 billion in initial PPP funding was depleted in two weeks, and it was later revealed that high-value loans went to large, publicly traded corporations.
The companies fell within the SBA eligibility requirements, but a lawsuit filed against JPMorgan Chase alleged the “pampering of its prized clients” like Ruth’s Chris caused smaller businesses to receive far less in PPP funds than they needed. Other banks have been sued as well.
When Congress refueled the program with $310 billion in additional funds, the eligibility requirements were not changed; however, the US Treasury issued guidance indicating that larger loans, especially those received by publicly traded companies, would be put under greater scrutiny.
Nearly 300 publicly traded companies received more than $1.05 billion in PPP loans, according to a CNN Business review of US Securities and Exchange Commission filings and data from analytics firm FactSquared.
The SBA has not disclosed information about who received the PPP loans. CNN and other entities have filed Freedom of Information Act requests for this data.
According to the most recent report from the SBA, dated April 16, the agency approved upward of 1.66 million loans for more than $342.2 billion. Of those, 4,412 were for $5 million or more. High-value loans represented 0.3% of the total number of loans and 9% of the overall dollar value.