Letter to Banks - Booker Presses Banks on Racial Disparities in Paycheck Protection Program

Letter

In an effort to help America's small businesses that have been impacted and even forced to close under the COVID-19 pandemic, Congress has allocated billions of federal dollars in aid to small businesses through the Coronavirus Aid, Relief, and Economic Security (CARES) Act and the Paycheck Protection Program and Health Care Enhancement (PPPHCE) Act. A cornerstone of the small business relief provisions is the Paycheck Protection Program (PPP), which was established to provide economic relief to small businesses across the nation in their efforts to keep workers employed during the crisis. To date, Congress has appropriated nearly $660 billion for PPP, including $60 billion specifically set aside for small lenders.

As a result of life-saving social distancing measures, very small businesses, including family-owned restaurants, barber shops and hair salons, independent retail shops, and others find themselves on the brink of insolvency. These small and micro-businesses are the backbone of our economy, and in comparison to larger companies, are disproportionately minority-owned. We know that minority owned businesses already face challenges in having equitable access to capital, pay higher interest rates and fees, and are less likely to be approved for loans. As such, it is critical that the funding allocated by Congress for PPP reach the businesses for which they were intended -- those in most need. I am deeply concerned by conversations with constituents and media reports that lending institutions have largely turned away many minority-owned businesses, thereby barring access to PPP's critical emergency financing.

As Congress considers additional funding for PPP and contemplates new small business programs, it is critical that we gain a greater understanding of who is benefiting from existing financing tools, and who has been left out. To better understand the impact and beneficiaries of this massive federal investment, I am requesting that your bank, as a major lender under the PPP, please provide the following information:

What is the total number and value of PPP loans that you have made to date?
What is the total number and value of PPP loans that you have made to businesses in the following categories:
Minority-owned businesses;
Women business enterprises; and
Veteran-owned businesses
What data can you share on the racial and ethnic makeup of New Jersey business owners that were approved for a PPP loan from your institution?
What is the breakdown in the sizes of businesses (by number of employees) approved for a PPP loan from your institution in New Jersey? What percentage of PPP loans went to businesses with 20 or fewer employees?
Please provide the number of awarded PPP loans made to New Jersey businesses by zip-code (i.e. volume of loans in each New Jersey zip code).
Thank you for your attention to this critical matter. We look forward to working with you to ensure that all New Jersey small businesses owners have an opportunity to access capital, maintain their businesses, and support their employees, families and communities during this unprecedented crisis.

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