Driven primarily by PPP-related loans, originations of new small business commercial and industrial loans in the second quarter of 2020 were more than nine times the size of originations in either the first quarter of 2020 or the second quarter of 2019. 2 However, 44 percent of respondents, on net, indicate loan standards tightened over the second quarter.
About 43 percent of respondents, on net, reported a deterioration in the credit quality of small business applicants—the largest decline since the inception of the survey and only the second time in which respondents of all bank sizes, on net, reported a decline. Minority small businesses have been particularly hard hit.