Bank Of America (NYSE: BAC) To Increase Lending By $5 Billion In 2010, Follows JP Morgan’s (NYSE: JPM) Similar Pledge

Shortly after President Obama finished telling big bank executives they need to explore every option available to increase lending, Bank of America (NYSE: BAC) announced it will increase lending to small and mid-sized business by $5 billion in 2010.

JP Morgan Chase (NYSE:  JPM) made a similar declaration about a month ago, pledging to increase lending in 2010 by $4 billion to small and mid-sized businesses.

Both banks intend to top their 2009 totals by said amounts.  Bank of America said it has provided $12 billion in loans to small businesses through the first three quarters of the year, along with helping 49,000 small business clients improve their cash flow through loan modifications.

President Obama, in a meeting with executives of the nation’s 12 biggest banks, stated “that America’s banks received extraordinary assistance from American taxpayers to rebuild their industry — and now that they’re back on their feet, we expect an extraordinary commitment from them to help rebuild our economy.”

“That starts with finding ways to help creditworthy small and medium-size businesses get the loans that they need to open their doors, grow their operations, and create new jobs,” Obama continued.  “This is something I hear about from business owners and entrepreneurs across America — that despite their best efforts, they’re unable to get loans.

Bank of America already has the country’s largest community development commitment underway, pledging $1.5 trillion over 10 years to low and moderate income households and businesses.

“We agree with the President that small and medium sized businesses are the lifeblood of the U.S. economy,” Bank of America CEO Ken Lewis said in a company press release.

“Our improved financial condition and our optimism about the economy will allow us to step up lending to support these clients,” Lewis added.