Phila. bank a top performer in small-business lending

Jay R. Goldstein , CEO of Valley Green Bank, saidhe learned what not to do before opening the bank.
Jay R. Goldstein , CEO of Valley Green Bank, saidhe learned what not to do before opening the bank.
Posted: June 23, 2013

Valley Green Bank is a top performer nationally among participants in the U.S. Treasury's Small Business Lending Fund, recent federal data showed.

The Philadelphia bank used a $5 million SBLF investment to help boost its small-business lending by $44 million, or 173 percent, since receiving the investment in 2011. In percentage terms, that ranked seventh in the nation, not counting three banks that started with less than $100,000 in loans.

Established by the Small Business Jobs Act of 2010, the idea behind the treasury fund was that every dollar invested could result in $10 of lending.

Valley Green came close to matching that through the end of 2012, but is not finished lending, president and chief executive Jay Goldstein said Thursday.

"We have plenty of capital to keep lending," Goldstein said. The advantage of the SBLF investment "is the more that we lend out, the more we are able to make in bottom-line profits." That translates into even more loans, he said.

Among Philadelphia-area participants, the Reinvestment Fund logged the smallest percentage gain. Its $11.7 million Treasury investment resulted a $5.9 million, or 5.2 percent, increase. The Philadelphia group said it had $90 million in new loans and $84 million in repayments.

DNB Financial in Downingtown, which received $13 million, had the smallest percentage increase among local banks. DNB increased lending by $17 million, or 14 percent. "It's a challenging operating environment today," said DNB's president and chief risk officer, William J. Hieb, but "overall, the program has been a success."


Small-Business Lending

The U.S. Treasury Department in 2011 invested $4 billion in 322 small lenders to encourage small-business loans. Results from local participants through Dec. 31:

                                 SBLF          Lending      %

Lender                           funding      Increase   change

Valley Green, Phila.                  $5.0       $44.0    173.3%

Monument, Doylestown               3.0       29.2       148.1%

Victory Bancorp, Limerick            3.4       25.6      97.2%

MileStone, Doylestown               5.1       42.3       90.4%

First Resource, Exton               5.1       8.8       26.6%

Penn Liberty, Wayne                  20.0       31.4       23.2%

DNB Financial, Downingtown         13.0       16.8       14.1%

Reinvestment Fund, Phila.            11.7       5.9       5.2%

SOURCE: U.S. Treasury Department


Contact Harold Brubaker at 215-854-4651 or hbrubaker@phillynews.com.

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