WASHINGTON, June 20 (UPI) -- The U.S. Treasury Department said Thursday that community banks were responding positively to its Small Business Lending Fund.
More than 90 percent of the participating banks in the first annual survey of the program indicated that small business lending had grown with the use of SBLF funds, the department said.
"These increases in lending allow entrepreneurs to turn their hard work and good ideas into thriving businesses, moving our economy and country forward," said Deputy Secretary of the Treasury Neal Wolin in a statement.
The department said in an report in April that lending increased by $8.9 billion and have calculated that an additional 38,000 loans were initiated as of the end of 2012.
The largest increases in loans by percentages went to the service and agricultural sectors, the Treasury said. Looking at the program from a geographical perspective, the Midwest and the South reported the largest increases, the survey found.
The SBLF program was established by the Small Business Jobs Act signed into law in 2010.
The program is designed to encourage lending at community banks to small businesses using incentives that link the cost of the capital to the level of small business lending.
The Treasury said it has invested more than $4 billion in 332 lending institutions through the SBLF.
"Collectively, these institutions operate in more than 3,000 locations across 48 states," the Treasury said.