Bernanke sees recovery of US economy in providing loans to small businesses

On Monday the Chairman of Federal Reserve Ben Bernanke has addressed banks and regulators urging them to Monday to seek for the opportunities to provide credits to small businesses to let them create jobs. According to him small businesses can help to improve the situation with unemployment which lowered to 9.5% in June compared to 9.7% in May. However it is still difficult to get those loans due to conditions.  

"Small businesses are central to creating jobs in our economy; they employ roughly one-half of all Americans and account for about 60 percent of gross job creation. Newer small businesses, those less than two years old, are especially important: Over the past 20 years, these start-up enterprises accounted for roughly one-quarter of gross job creation even though they employed less than 10 percent of the workforce," he said. 

The Chairman has noted that according to bank financial reports submitted to the Federal Financial Institutions Examination Council the loan amounts given to small business have increasingly decreased to less than $670 billion in the first quarter of 2010 from about $710 billion in the second quarter of 2008. 

"Our message is clear: Consistent with maintaining appropriately prudent standards, lenders should do all they can to meet the needs of creditworthy borrowers. Doing so is good for the borrower, good for the lender, and good for our economy," concluded Bernanke.