PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

Kerrigan in Real Clear Policy: Exploiting SVB & First Republic Fallout Will Choke Off Capital for Small Businesses

By at 5 May, 2023, 12:41 pm

In a May 5 Real Clear Policy Op-ed, SBE Council president & CEO Karen Kerrigan warns about potential regulatory moves against regional banks that could squeeze capital and credit further for small businesses. Kerrigan notes that wrongheaded policies that have fueled inflation, rapid interest rates hikes, along with passive federal regulators who already have the tools to monitor and discover emerging problems and mismanagement, are to blame. Kerrigan writes:

“Not surprisingly, according to our new Small Business Checkup Survey conducted by Technometrica, 60 percent of small business owners report that rising interest rates are having a negative impact on their business and 44 percent say that a “credit crunch” is doing the same. Misguided regulatory punishment aimed at small to mid-size banks would only serve to exacerbate small business woes, and in turn harm the broader economy.”

Kerrigan adds:

“Biden Administration spending policies and regulators at the Federal Reserve should be the parties held accountable. Our banking system is one of the most regulated industries in the world, and piling on new regulations and compliance costs on regional banks would have a negative downstream impact on small businesses. Regional banks are big lenders to small businesses. Let’s keep it that way and fix the root causes of the SVB and First Republic failures rather than squeezing capital further as the nation possibly heads into a recession.”

Read the full piece here.

 

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