US small business lending jumps in May
* Rise in lending nearly erases four months of declines
* Small businesses have record low loan delinquencies
By Ann Saphir
CHICAGO, July 2 (Reuters) – Lending to small U.S. businesses
rose in May to its highest level this year, a sign of stronger
economic growth ahead even as other data suggests fragility, a
report showed on Monday.
The Thomson Reuters/PayNet Small Business Lending Index,
which measures the overall volume of financing to small U.S.
companies, rose to 108.4 from an upwardly revised 98.6 in April,
PayNet said. The gain reversed most of the declines of the prior
four months.
Borrowing rose 18 percent in May from a year earlier,
exceeding the average 2011 pace of 17 percent. The lending index
historically has pointed to changes in overall economic growth
several months later.
Low interest rates and stronger corporate balance sheets are
probably fueling the increase in borrowing, said PayNet founder
Bill Phelan.
And while the latest data is for only one month, he added,
“I think it means we have a higher chance of sidestepping
another contraction in the economy.”
The jump in small business lending contrasts with other data
signaling economic trouble, including a drop in consumer
confidence in June and stalled
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