Larsen Questions Secretary Geithner On Small Business Lending Fund

Press Release

U.S. Representative Rick Larsen (WA-02), member of the House Budget Committee, questioned Timothy Geithner, Secretary of the U.S. Department of Treasury, on the Administration's proposal for a Small Business Lending Fund when he appeared before a House Budget Committee hearing yesterday. Larsen spent the February District Work Period meeting with community banks in Northwest Washington to talk about how they can help spur job growth by lending to small businesses.

"Community banks are ready, willing and able to lend," said Rep. Larsen. "We need to provide them with the tools they need and a regulatory environment that works so they can loan much-needed capital to small businesses that will use the resources to grow and start hiring again."

The Obama Administration has proposed using $30 billion from the Troubled Asset Relief Program (TARP) to help community banks lend to small businesses. Larsen supports increasing lending opportunities to small businesses but is concerned about the impact the current regulatory environment is having on community banks and their ability to make capital available to small businesses.

"There seems to be a disconnect between policy and what is actually working on the ground," said Rep. Larsen. "I support the Administration's proposal to help community banks make these critical loans, but before we give out a dime of this money, we need to be certain it will actually be put to work creating jobs and growing our economy."

At yesterday's House Budget Committee hearing, Larsen expressed these concerns to Secretary Geithner and asked him what measures will be taken to ensure the proposed Small Business Lending Fund is available to community banks to lend, rather than keeping the funds on their balance sheets to meet capital requirements put in place by federal regulators. Secretary Geithner responded that the Department of Treasury is aware of the issue and will work with the regulators so this fund can be utilized for its intended purpose.

"I was pleased to hear Secretary Geithner assure us that the Department of Treasury will coordinate with federal regulators to ensure that these funds will be available for lending," said Rep. Larsen. "I will continue to work hard to help community banks provide small businesses with the tools they need to grow jobs and build our economy."

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