Business Loan Program Maximum Allowable Fixed Rate, 50263-50264 [E9-23558]

Download as PDF CPrice-Sewell on DSKGBLS3C1PROD with NOTICES Federal Register / Vol. 74, No. 188 / Wednesday, September 30, 2009 / Notices Language was added to provide additional clarity regarding the penalties for incomplete and/or inaccurate statements. Language was added to clarify that the form may also be used by agencies in determining whether a subject performing work for or on behalf of the Government under a contract should be deemed eligible for logical or physical access when the nature of the work to be performed is sensitive and could bring about an adverse effect on the national security. Language referencing immunity protections was added to the questions regarding illegal use of drugs or drug activity, use of information technology systems, and association record. Questions were added to the section on police record in order to identify respondents who may be impacted by the restrictions cited in the Lautenberg Amendment. The advisement regarding mental health counseling was expanded to explain that mental health counseling in and of itself is not a reason to revoke or deny eligibility for access to classified information or for a sensitive position, suitability or fitness to obtain or retain Federal employment, fitness to obtain or retain contract employment, or eligibility for physical or logical access to Federally controlled facilities or information systems. Questions that elicited the reason for and nature of mental health treatment were removed, as were questions regarding participation in self-help groups for alcohol abuse. In the financial record section, the question regarding involvement with a credit counseling service was amended to better capture mitigating information from respondents who seek assistance to resolve financial difficulties. A question on holding foreign political office and voting in foreign elections was moved from the form’s association record section to the form’s foreign activities section. To provide additional clarity, a copy of a matrix, ‘‘Changes between Current Form and proposed Sep 09 30-day Notice,’’ that shows the changes between the currently approved SF 86 and the SF 86 proposed in this 30-day notice, is available upon request. John Berry, Director, U.S. Office of Personnel Management. [FR Doc. E9–23711 Filed 9–29–09; 8:45 am] BILLING CODE 6325–53–P VerDate Nov<24>2008 14:56 Sep 29, 2009 Jkt 217001 SMALL BUSINESS ADMINISTRATION Business Loan Program Maximum Allowable Fixed Rate AGENCY: U.S. Small Business Administration (SBA). ACTION: Notice announcing maximum allowable fixed rate. SUMMARY: This Notice announces the maximum allowable fixed rate for 7(a) guaranteed loans. DATES: This Notice is effective October 1, 2009. FOR FURTHER INFORMATION CONTACT: The Lender Relations Specialist in the SBA district office nearest you. The list of offices can be found at https:// www.sba.gov/localresources/. SUPPLEMENTARY INFORMATION: Agency regulations at 13 CFR 120.213(a), Fixed Rates for Guaranteed Loans, state the following: ‘‘A loan may have a reasonable fixed interest rate. SBA periodically publishes the maximum allowable rate in the Federal Register.’’ For a number of years, the SBA maximum allowable fixed rate has been based on the Prime rate. Because the Prime rate is a short term rate, very few lenders have been willing to make long term SBA Section 7(a) loans with a fixed rate. In order to provide small businesses with an opportunity to lock in the fixed interest rates available in the market today, SBA is revising how the maximum allowable fixed rate is calculated. Effective October 1, 2009, the SBA maximum allowable fixed rate for 7(a) loans (other than SBA Express and Export Express loans) will utilize a new base rate for fixed rate loans (Fixed Base Rate) plus the maximum allowable spreads that are already being used on variable rate loans. The Fixed Base Rate for a 7(a) loan will be calculated as follows: The SBA LIBOR Base Rate (defined in 13 CFR 120.214 as the 1-month LIBOR in effect on the first business day of the month as printed in a national financial newspaper each business day PLUS 300 basis points), plus the average of the 5year and 10-year LIBOR swap rates in effect on the first business day of the month as printed in a national financial newspaper published each business day. In other words, the Fixed Base Rate is based on the rate a borrower would pay if it purchased a floating-to-fixed rate swap contract on a 7(a) loan. A swap rate factors in what the money markets identify as the likely difference between a variable rate and a fixed rate over a set period of time. SBA chose to use the average of the 5-year and 10-year LIBOR swap rates in the calculation of the maximum allowable fixed rate PO 00000 Frm 00102 Fmt 4703 Sfmt 4703 50263 because these rates are published in a financial newspaper on a daily basis and the average of these two rates will provide a basis for a maximum allowable fixed rate appropriate both for shorter term and longer term loans. The maximum allowable fixed rate for 7(a) loans (excluding SBA Express and Export Express) will be the Fixed Base Rate plus the allowable interest rate spreads identified in 13 CFR 120.214 (d) and (e) and 13 CFR 120.215. (For SBA Express and Export Express loans, the maximum allowable interest rate is the prime rate plus 6.5 or 4.5 depending on the loan amount. See SOP 50 10 5(B), Subpart B, Chapter 3. SOP 50 10 5(B) may be found at https://www.sba.gov/ aboutsba/sbaprograms/elending/reg/ index.html.) The following is an example for 7(a) loan applications (other than SBA Express and Export Express), submitted to SBA in the month of September 2009 if the new policy had been in effect: The SBA LIBOR Base Rate for September is 3.26. The 5-year LIBOR swap rate on the first business day of September as published in a national financial newspaper was 2.72 (rounded to the second decimal). The 10-year LIBOR swap rate on the first business day of September as published in a national financial newspaper was 3.60 (rounded to the second decimal). The average of these two rates is 3.16. The SBA Fixed Base Rate for loans submitted to SBA during September 2009 would have been 6.42 [3.26 (SBA LIBOR Base Rate) + 3.16 (average of 5year and 10-year swap rates)]. Thus, the maximum allowable fixed rates for 7(a) loans (other than SBA Express and Export Express) submitted to SBA in September 2009 would have been as follows: For 7(a) loans with a maturity less than 7 years: 6.42 (SBA Fixed Base Rate for September) + 2.25 (maximum spread for loans with a maturity less than 7 years) equals 8.67 (maximum allowable fixed rate). If the loan amount is over $25,000 but not exceeding $50,000, the maximum allowable fixed rate may be increased by one percentage point. If the loan amount is $25,000 or less, the maximum allowable fixed rate may be increased by two percentage points. For 7(a) loans with a maturity of 7 years or more: 6.42 (SBA Fixed Base Rate for September) + 2.75 (maximum spread for loans with a maturity of 7 years or more) equals 9.17 (maximum allowable fixed rate). If the loan amount is over $25,000 but not exceeding $50,000, the maximum allowable fixed rate may be increased by one percentage point. If the loan amount is $25,000 or E:\FR\FM\30SEN1.SGM 30SEN1 50264 Federal Register / Vol. 74, No. 188 / Wednesday, September 30, 2009 / Notices less, the maximum allowable fixed rate may be increased by two percentage points. The maximum allowable fixed rates will be posted monthly on SBA’s Web site at https://www.sba.gov/aboutsba/ sbaprograms/elending on the second business day of the month, in the afternoon. SBA will review the newspaper on the second business day of the month to determine the SBA LIBOR Base Rate and the LIBOR swap rates in effect on the first business day of the month and will use those rates in the calculation. The new maximum allowable fixed rates identified in this Notice will be available for 7(a) loan applications (other than SBA Express and Export Express) received by SBA on or after October 1, 2009. Questions on the maximum allowable fixed rates may be directed to the Lender Relations Specialist in the local SBA district office. The local SBA district office may be found at https:// www.sba.gov/localresources. Authority: 15 U.S.C. 636(a)(4)(A) and 13 CFR 20.213. Richard C. Blewett, Acting Director, Office of Financial Assistance. [FR Doc. E9–23558 Filed 9–29–09; 8:45 am] BILLING CODE 8025–01–P SMALL BUSINESS ADMINISTRATION Small Business Information Security Task Force; Request for Nominations CPrice-Sewell on DSKGBLS3C1PROD with NOTICES AGENCY: U.S. Small Business Administration (SBA). ACTION: Request for nominations. SUMMARY: On May 22, 2009, Public Law 111–24 was signed by the President establishing, among other things, a Small Business Information Security Task Force. This task force was established to address the information technology security needs of small businesses and to help small businesses prevent the loss of credit card data. SBA is now requesting nominations for members of this task force. DATES: Submit nominations on or before 5 p.m. EST October 16, 2009 per the instructions below. FOR FURTHER INFORMATION CONTACT: Any member of the public wishing further information regarding this request for nominations may contact Jack Bienko, via telephone (202) 205–6052, fax (202) 481–2636, e-mail john.bienko@sba.gov or mail U.S. Small Business Administration, 409 3rd Street, SW., 6th Floor, Washington, DC 20416. VerDate Nov<24>2008 14:56 Sep 29, 2009 Jkt 217001 SBA is requesting nominations for the Small Business Information Security Task Force. SBA encourages all qualified candidates to apply. Candidates may self-nominate or be nominated by another source. SUPPLEMENTARY INFORMATION: Function of the Task Force This task force was established by section 507 of Public Law 111–24 to assess the information security needs of small business concerns, including the programs and services currently available, and make recommendations to SBA as to new programs and services which will help small businesses address those concerns. Specifically, the task force shall: 1. Identify the information technology security needs of small business concerns, 2. Identify and assess the programs and services provided by Federal and State governments and non-government organizations which serve the information technology security needs of small business concerns, 3. Make recommendations to SBA on how to more effectively serve small business information technology security needs through the creation of new Federal programs and services, small business education and training, or more effective marketing of existing programs, 4. Make recommendations on how SBA can better inform and educate small businesses on information technology security concerns, including use of the Internet, 5. Assess and recommend whether a permanent advisory board should be created, 6. Provide SBA with a comprehensive list of Internet sites containing appropriate and relevant information on small business information technology security needs of which SBA should link, and 7. Prepare a final report with recommendations for SBA, which will be submitted to Congress. Qualifications From the nominations received, the SBA Administrator will appoint a Chair and Vice Chair of the task force. The Administrator will then work with the Chair to appoint up to 13 additional members; at least one from each of the following categories who will serve as representatives of their respective constituency: 1. Subject matter experts, 2. Users of information technology within small business concerns, PO 00000 Frm 00103 Fmt 4703 Sfmt 4703 3. Vendors of information technologies for small business concerns, 4. Academics with expertise in the use of information technologies to support business, 5. Small business trade associations, 6. Federal, state or local agencies engaged in securing cyberspace, and 7. Information technology training providers with expertise on the use of information technologies to support business. Meetings The entire task force will meet at least twice per year in Washington DC. Other meetings may occur via conference call. Status All members will be considered representatives and will not be paid for participation however the Agency will pay travel and per diem expenses while members are attending required meetings in Washington, DC. Expectations All task force members are expected to fully participate in the task force and come to the twice-yearly meetings in Washington DC. What To Send 1. Letter of Nomination: nominees should send a letter of self-nomination or a letter of nomination from a peer or professional organization or society. This letter must indicate which category the nominee fulfills and highlight accomplishments, including studies, publications and professional accomplishments related to small business information technology security issues. 2. Current resume. 3. Biographical sketch (optional) no more than two pages listing areas of expertise related to information technology security and small business, research activities, service on other Federal advisory committees and professional organizations. 4. Nomination Form: Nominees must complete and sign SBA Form 898 (available at https://www.sba.gov/nac). All nominees are subject to a conflict of interest determination by SBA and will not be considered eligible until such determination is made. Nominations must be sent to Jack Bienko at the above information. E-mail and fax are preferred methods of submission. E:\FR\FM\30SEN1.SGM 30SEN1

Agencies

SMALL BUSINESS ADMINISTRATION

[Federal Register Volume 74, Number 188 (Wednesday, September 30, 2009)]
[Notices]
[Pages 50263-50264]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-23558]


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SMALL BUSINESS ADMINISTRATION


Business Loan Program Maximum Allowable Fixed Rate

AGENCY: U.S. Small Business Administration (SBA).

ACTION: Notice announcing maximum allowable fixed rate.

-----------------------------------------------------------------------

SUMMARY: This Notice announces the maximum allowable fixed rate for 
7(a) guaranteed loans.

DATES: This Notice is effective October 1, 2009.

FOR FURTHER INFORMATION CONTACT: The Lender Relations Specialist in the 
SBA district office nearest you. The list of offices can be found at 
https://www.sba.gov/localresources/.

SUPPLEMENTARY INFORMATION: Agency regulations at 13 CFR 120.213(a), 
Fixed Rates for Guaranteed Loans, state the following: ``A loan may 
have a reasonable fixed interest rate. SBA periodically publishes the 
maximum allowable rate in the Federal Register.''
    For a number of years, the SBA maximum allowable fixed rate has 
been based on the Prime rate. Because the Prime rate is a short term 
rate, very few lenders have been willing to make long term SBA Section 
7(a) loans with a fixed rate. In order to provide small businesses with 
an opportunity to lock in the fixed interest rates available in the 
market today, SBA is revising how the maximum allowable fixed rate is 
calculated. Effective October 1, 2009, the SBA maximum allowable fixed 
rate for 7(a) loans (other than SBA Express and Export Express loans) 
will utilize a new base rate for fixed rate loans (Fixed Base Rate) 
plus the maximum allowable spreads that are already being used on 
variable rate loans.
    The Fixed Base Rate for a 7(a) loan will be calculated as follows: 
The SBA LIBOR Base Rate (defined in 13 CFR 120.214 as the 1-month LIBOR 
in effect on the first business day of the month as printed in a 
national financial newspaper each business day PLUS 300 basis points), 
plus the average of the 5-year and 10-year LIBOR swap rates in effect 
on the first business day of the month as printed in a national 
financial newspaper published each business day. In other words, the 
Fixed Base Rate is based on the rate a borrower would pay if it 
purchased a floating-to-fixed rate swap contract on a 7(a) loan. A swap 
rate factors in what the money markets identify as the likely 
difference between a variable rate and a fixed rate over a set period 
of time. SBA chose to use the average of the 5-year and 10-year LIBOR 
swap rates in the calculation of the maximum allowable fixed rate 
because these rates are published in a financial newspaper on a daily 
basis and the average of these two rates will provide a basis for a 
maximum allowable fixed rate appropriate both for shorter term and 
longer term loans.
    The maximum allowable fixed rate for 7(a) loans (excluding SBA 
Express and Export Express) will be the Fixed Base Rate plus the 
allowable interest rate spreads identified in 13 CFR 120.214 (d) and 
(e) and 13 CFR 120.215. (For SBA Express and Export Express loans, the 
maximum allowable interest rate is the prime rate plus 6.5 or 4.5 
depending on the loan amount. See SOP 50 10 5(B), Subpart B, Chapter 3. 
SOP 50 10 5(B) may be found at https://www.sba.gov/aboutsba/sbaprograms/elending/reg/.)
    The following is an example for 7(a) loan applications (other than 
SBA Express and Export Express), submitted to SBA in the month of 
September 2009 if the new policy had been in effect:
    The SBA LIBOR Base Rate for September is 3.26.
    The 5-year LIBOR swap rate on the first business day of September 
as published in a national financial newspaper was 2.72 (rounded to the 
second decimal). The 10-year LIBOR swap rate on the first business day 
of September as published in a national financial newspaper was 3.60 
(rounded to the second decimal). The average of these two rates is 
3.16.
    The SBA Fixed Base Rate for loans submitted to SBA during September 
2009 would have been 6.42 [3.26 (SBA LIBOR Base Rate) + 3.16 (average 
of 5-year and 10-year swap rates)].
    Thus, the maximum allowable fixed rates for 7(a) loans (other than 
SBA Express and Export Express) submitted to SBA in September 2009 
would have been as follows:
    For 7(a) loans with a maturity less than 7 years: 6.42 (SBA Fixed 
Base Rate for September) + 2.25 (maximum spread for loans with a 
maturity less than 7 years) equals 8.67 (maximum allowable fixed rate). 
If the loan amount is over $25,000 but not exceeding $50,000, the 
maximum allowable fixed rate may be increased by one percentage point. 
If the loan amount is $25,000 or less, the maximum allowable fixed rate 
may be increased by two percentage points.
    For 7(a) loans with a maturity of 7 years or more: 6.42 (SBA Fixed 
Base Rate for September) + 2.75 (maximum spread for loans with a 
maturity of 7 years or more) equals 9.17 (maximum allowable fixed 
rate). If the loan amount is over $25,000 but not exceeding $50,000, 
the maximum allowable fixed rate may be increased by one percentage 
point. If the loan amount is $25,000 or

[[Page 50264]]

less, the maximum allowable fixed rate may be increased by two 
percentage points.
    The maximum allowable fixed rates will be posted monthly on SBA's 
Web site at https://www.sba.gov/aboutsba/sbaprograms/elending on the 
second business day of the month, in the afternoon. SBA will review the 
newspaper on the second business day of the month to determine the SBA 
LIBOR Base Rate and the LIBOR swap rates in effect on the first 
business day of the month and will use those rates in the calculation.
    The new maximum allowable fixed rates identified in this Notice 
will be available for 7(a) loan applications (other than SBA Express 
and Export Express) received by SBA on or after October 1, 2009.
    Questions on the maximum allowable fixed rates may be directed to 
the Lender Relations Specialist in the local SBA district office. The 
local SBA district office may be found at https://www.sba.gov/localresources.

    Authority:  15 U.S.C. 636(a)(4)(A) and 13 CFR 20.213.

Richard C. Blewett,
Acting Director, Office of Financial Assistance.
[FR Doc. E9-23558 Filed 9-29-09; 8:45 am]
BILLING CODE 8025-01-P

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