Bank of America Corp (NYSE: BAC) to Increase Small Business Lending

Bank of America Corp (NYSE: BAC) announced on Tuesday that it plans to increase lending to small and mid-sized businesses in 2010 by nearly $9 billion compared to 2009 levels.

The Charlotte, NC-based bank said that it has made $45.4 billion in loans this year to small and mid-sized businesses. In a statement, Bank of America Corp (NYSE: BAC) said that the increase in lending to the borrowers is part of a commitment tha the firm made in 2009 to increase lending to small and mid-sized businesses by $5 billion in 2010.

According to Bank of America Corp (NYSE: BAC), the firm loaned $81.4 billion to small and mid-sized businesses in 2009. Year to date the firm loaned $19.4 billion in the first quarter and more than $26 billion in the second quarter.

Many small and mid-sized businesses have had difficulty in finding financing since the recession which set on in 2007. Analysts have said that lending was too loose earlier in the decade, a component which helped caused the economic down turn. Now many say that the opposite has happened and obtaining credit for small and mid-sized businesses is too difficult.

“Small and mid-sized businesses are the engine of job growth, so the extent to which creditworthy businesses are able to get credit is integral to economic recovery,” said Greg McBride, of Bankrate.com to Fox Business.

Gus Faucher, director of Macroeconomics at Moody’s Economy.com, told Fox Business that credit isn’t any more difficult than it was to get a year or two ago. The bad news is that “it’s still very tight,” he said. “It’s still a significant problem for small and medium businesses.” “What we’re really concerned about is the smaller regional banks. They’re the ones that do a lot of the loaning to small businesses and they’re still facing severe problems in part because they have a lot of commercial real estate loans on the books that are having problems,” Faucher commented.