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Bank executives sought guidance on small business loan program from Ivanka Trump: report

Bank executives sought guidance on small business loan program from Ivanka Trump: report
© Greg Nash

Bank executives who were concerned about the $349 billion emergency small business program created in the $2.2 trillion coronavirus stimulus bill passed last week reached out to President TrumpDonald TrumpBiden administration still seizing land near border despite plans to stop building wall: report Illinois House passes bill that would mandate Asian-American history lessons in schools Overnight Defense: Administration says 'low to moderate confidence' Russia behind Afghanistan troop bounties | 'Low to medium risk' of Russia invading Ukraine in next few weeks | Intelligence leaders face sharp questions during House worldwide threats he MORE’s daughter and senior adviser Ivanka TrumpIvanka TrumpChelsea Clinton: Pics of Trump getting vaccinated would help him 'claim credit' Ivanka Trump gets vaccine, urges public to do the same Trump alumni launch America First Policy Institute MORE as they tried to negotiate higher interest rates, according to Bloomberg.

The calls came from multiple major bank executives, including from Bank of America Corp., who questioned the Paycheck Protection Program, which provides generous loans to small businesses with the caveat that they use at least 75 percent to pay their employees. 

As a result of those negotiations, Treasury Secretary Steven MnuchinSteven MnuchinDemocrats justified in filibustering GOP, says Schumer Yellen provides signature for paper currency Biden's name will not appear on stimulus checks, White House says MORE and other administration officials requested to increase the interest rates on the forgivable, government-backed loans, and worked to encourage smaller banks to participate, as well.

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Mnuchin announced Thursday that the Treasury Department would cut interest rates in half in an effort to convince those smaller banks to participate and alleviate the load from major lenders. 

“I’ve told these bankers they should take all their traders and put them in the branches. There’ll never be another opportunity to earn five points on a 90-day fully government-guaranteed loan,” Mnuchin said on Thursday. “To make this attractive for community banks, we’ve agreed to raise the interest rate.”

The new program was off to a rough start this week as banks and other lenders said the $349 billion program lacks clear guidelines to handle a looming wave of loan applications that could overwhelm the system while leaving some firms in the lurch.