Code of Maryland Regulations
Title 24 - DEPARTMENT OF COMMERCE
Subtitle 05 - ECONOMIC DEVELOPMENT
Chapter 24.05.08 - Small Business Development Guaranty Fund
Section 24.05.08.07 - Interest Subsidy
Current through Register Vol. 51, No. 6, March 22, 2024
In addition to the granting of a loan guaranty, the Authority may for the benefit of an applicant provide an interest subsidy to a financial institution issuing a loan guarantied by the Authority pursuant to this regulation which:
A. Is payable quarterly;
B. Does not exceed the difference between the rate of interest requested by the financial institution to make the loan (which rate may not exceed the rate of interest determined by the Authority to be the monthly weighted average of the prime lending rate, plus 2 percent, prevailing from time to time in the City of Baltimore on unsecured commercial loans) and the discount rate of interest employed by the Federal Reserve Bank of the United States, the difference to be determined by the Authority as of the date of closing of the loan for which the guaranty is given;
C. Is payable during the term of the loan, excluding any period in which the Authority determines that the loan is in default;
D. May be approved for the life of the loan or may be approved for 1 year, renewable annually at the Authority's discretion; and
E. May not exceed 4 percent.
