The U.S. Small Business Administration guaranteed fewer bank loans in Kansas in fiscal 1998 than it did a year earlier.
The decline apparently is because banks have been more willing to loan money directly to businesses without the federal guarantees provided by the SBA.
Figures released by the Kansas City, Mo., and Wichita district offices of the SBA show loans for $89.66 million were guaranteed across Kansas in fiscal 1998, down nearly 35 percent from the $92.89 million guaranteed in 1997. The number of loans guaranteed also dipped by about 18 percent, to 531 from 650.
In Douglas County, the trend was mixed. Though fewer loans were guaranteed, the total amount of those loans was up.
In fiscal 1998, the SBA guaranteed 19 loans for $3.81 million in the county. A year earlier, there were 23 loans for only $3.42 million.
The loan guarantees are generally designed for businesses that might not otherwise be able to borrow money.
Patty Ingram, SBA spokeswoman in Kansas City, said low interest rates and increased competition among banks for customers was the reason for the dip.
"They're all afraid that somebody's going to go down the street and take their business to another lender," she said.
The trend was mirrored in other Midwestern states.
In Iowa, businesses borrowed $88.37 million in fiscal 1998, down from $89.3 million a year earlier. In Nebraska, businesses borrowed $41.9 million in fiscal 1998, down 14.8 percent from 1997.
"SBA lending was down nationwide this year," Ingram said. "We weren't really concerned about it because we've been at record highs."
Across Kansas, loans also were made in fewer total counties in 1998 than in 1997, the SBA said.
In the fiscal year ended Sept. 30, loans were made in only 68 of Kansas' 105 counties. In 1997, loans were made in 84 counties.
Here's a look at the number and amount of 1998 loans made in other selected Kansas counties:
Jefferson -- 1, $25,000.
Johnson -- 154, $22.03 million.
Shawnee -- 18, $3.8 million.
Ingram said SBA loan activity through the first two months of the new fiscal year was about even with last year's pace.
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