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Housing
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Banking On Business
2012 Banking On Business Program Details
The Board of Directors of FHLBank Pittsburgh has approved $2.2 million for the Banking On Business (BOB) program, to be distributed through two funding rounds in 2012.
The first round opened on February 1 with $1.6 million available – $1.1 million for general small business use and a $500,000 set-aside for small businesses located in or serving Blueprint Communities.
As a result of strong demand, funds available during the first round have been exhausted. Although general BOB funding has been depleted, funding under the Blueprint Communities set-aside is still available.
Member banks that service designated Blueprint Communities are encouraged to look at the small business needs in these areas and consider the use of BOB funds from the set-aside to support or facilitate any lending they might do in these areas. The list of designated Blueprint Communities and their approved geographic definition is available here.
This Blueprint Communities set-aside will remain available until it is exhausted or until the opening of the second funding round, whichever comes first.
The second BOB funding round will open on September 6 with an additional $600,000 plus any unused funds remaining from the Blueprint Communities set-aside.
The 2012 BOB funding manual contains this year’s program guidelines and the registration form (in PDF format) and is available at right.
If you have any questions concerning the 2012 BOB funding rounds or if you are considering participation in the program and require technical assistance, please do not hesitate to call James Gasperowich at 1-800-288-3400, x2864.
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What is Banking On Business?
Banks are sometimes unable to lend money to small
businesses
— especially start-ups — that lack sufficient
equity or cash flow. But with FHLBank Pittsburgh's
Banking On Business (BOB) program to make these deals
more bankable, financial institutions are more willing
to provide loans.
Delivered through member financial institutions, BOB
funding helps eligible small businesses with start-up
and expansion. Each BOB dollar FHLBank contributes will
likely leverage an additional $6 in financial resources
to small businesses in the region, thereby creating
or retaining jobs and improving local communities.
BOB offers recoverable assistance to be leveraged
with member financing to help small businesses that
need it most. Since 2000, FHLBank has funded more
than $46 million in BOB funding to assist small
businesses in our district, creating or retaining
more than 6,400 jobs.
What qualifies for BOB funding?
Banking On Business (BOB) funds may be used in financing
the start-up or expansion of a small business and may
be applied toward:
- Purchase of a building
- Land acquisition and construction
- Expansion of a facility
- Purchase of machinery and equipment
- Leasehold improvements
- Permanent working capital
- Closing costs
NOTE: Not eligible for funding is any small business
that:
- Does not meet FHLBank's definition of “small
business”
- Is in the financial, insurance, real estate or government
sectors
- Is a nonprofit organization
- Is in the housing area (which gives them access
to our Affordable Housing Program [AHP] and Community
Lending Program [CLP] programs.)
As part of the program, each participating member
financial institution must make a loan to the customer
in combination with recoverable assistance using BOB
funds. When the customer repays the BOB-funded loan,
the member must remit these payments to FHLBank annually.
BOB funds assist communities as follows:
- Creating/retaining jobs
- Assisting members in providing capital to underserved
areas and for underserved populations
- Promoting local economic growth
What criteria are used?
Member financial institutions submit an enrollment
form to access a general pool of BOB funds (similar
to the First Front Door program) on a first-come, first-served
basis. BOB funds may be used for any business located
within Delaware, Pennsylvania or West Virginia.
Applicants are encouraged to use Small Business Development
Centers and similar entities to provide ongoing technical
assistance to small businesses participating in the
program.
All grants are in the form of recoverable assistance,
with specific repayment terms. Each transaction with
a small business must meet the following guidelines:
- The member financial institution must show that
the loan would not have been made without BOB financing.
- The member must provide financing and have credit
exposure in each transaction.
- The member must provide a loan of at least 40 percent
of the total project cost.
- The total BOB financing must not exceed 50 percent
of the member loan, except in cases when the member
uses a public loan guarantee program. In such cases,
BOB will provide up to 50 percent of the remaining
exposure of the member bank.
- The terms and conditions of the transaction must
be consistent with similar credit transactions the
member makes.
- Businesses can receive only one BOB loan.
How do you apply?
Members can call the Community Investment Department
at 1-800-288-3400 or contact
us via email to inquire about fund availability
or to request an application. The application contains:
- An enrollment form requesting participation in BOB
- A registration form for each qualifying small business
- A funding form for requesting funds at closing for
the small business identified in your registration
form
- A BOB performance measurement report is due the
first year of repayment
Electronic versions of the updated BOB Manual and forms
(which are within the manual) are available for download
at right.
To register a business, email a copy of the completed
BOB registration form to James Gasperowich. Then mail the original and signed BOB
business registration form, with supporting documentation,
to James Gasperowich, FHLBank Pittsburgh, 601 Grant Street, Pittsburgh, PA 15219.
The Community Investment Department can assist you
in completing applications and any supplemental forms,
and in explaining the responsibilities of each party
involved in the BOB program. To speak to a Community
Investment representative about BOB, please contact James Gasperowich at 412-288-2864,or contact
us via email with questions.
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