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Small Business Administration: Actions Needed to Strengthen Small Business Lending Company Oversight

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Report Type Reports and Testimonies
Report Date Nov. 17, 2000
Report No. GAO-01-192
Subject
Summary:

The Farm Credit Administration (FCA) reviewed the Small Business Administration's (SBA) oversight of the Small Business Lending Companies (SBLC) program and determined that several areas could be strengthened. SBA officials said that the agency plans to take appropriate action on most of FCA's recommendations to improve the program. However, FCA expressed concern about the financial risk to SBA's loan portfolio associated with less favorable economic conditions. Such conditions could place upward pressure on SBA's 7(a) loan default rates. SBA needs to have access to information that accurately identifies risk in both individual loan and the total portfolio. The initial SBLC examination results have provided some information to aid in such risk identification, but a continued effort is needed.

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