New guidance on PPP loans for self-employed, independent contractors
Bank directors also eligible for PPP loans
The Small Business Administration today issued an  interim final rule   clarifying eligibility and application processes for independent contractors and self-employed individuals seeking PPP funds.

The rule clarifies that self-employed individuals who filed Schedule C with their federal income taxes and were operating on Feb. 15, 2020, are eligible for PPP loans, except for partners in a partnership. (The partnership is the eligible entity, and the rule provides guidance for calculating the self-employment income of general active partners as payroll cost.)

The rule also provides processes for self-employed applicants to calculate their maximum loan amount, depending on whether they have employees or not. Self-employed PPP loan recipients may use the proceeds for “owner compensation replacement,” calculated based on monthly net profits. Individual partners in a partnership are not eligible.

The SBA also clarified that many bank directors and shareholders are eligible for PPP loans from their banks. Pre-existing SBA limits on these applicants’ eligibility shall not apply to otherwise eligible businesses owned in whole or part by outside bank directors or those holding a less-than-30% equity interest in the PPP lender, provided that the eligible business follows the same process as any similarly situated customer or account holder and does not receive favoritism.

However, officers and key employees of the bank may not obtain a PPP loan from their own bank but may apply at a different lender.

The Small Business Administration and Treasury Department provided guidance yesterday clarifying lenders’ obligations to collect beneficial ownership data when making Payment Protection Program loans.
As previously stated, depository institutions making PPP loans to existing customers do not need to re-verify beneficial ownership information if it has already been verified, or to collect and verify data if they have not already done so, unless otherwise indicated by the lender’s risk-based Bank Secrecy Act compliance approach.
In the latest update to their FAQ document on the PPP, SBA and Treasury clarified that lenders making PPP loans to new customers may satisfy beneficial ownership requirements by collecting the name, title, ownership percentage, taxpayer ID number, address and date of birth for natural persons owning at least 20% of a PPP applicant. For legal entity owners of at least 20% of a PPP loan applicant, the lender should collect “appropriate beneficial ownership information for that entity.”

Avoiding and effectively dealing with lender liability litigation during a downturn

This webinar will focus on measures lenders can take to avoid, minimize, and effectively deal with claims and litigation from borrowers, guarantors, competing lienholders and others. Topics for discussion will include:

  • Identifying loans, borrowers, and collateral likely to produce litigation
  • Best practices for loan forbearance, modification, and workout negotiations and documentation
  • Common lender liability claims and defenses 
  • Best practices for record preservation and discovery

When: April 23 from 10-11 a.m.
Presenter: Scott Sandberg, attorney, Spencer Fane LLP
Price : $50 members $75 non members
According to SBA data released this afternoon:

Colorado banks have made 28,469 PPP loans amounting to $3.8 billion dollars.

Across the country, more than one million loans have been made, totaling $247.5 billion dollars, via 4,664 lenders.
Deb Bayles Stinson
FREE webinar series on PPP program continues Friday

CBA on Friday will continue hosting its open forum series to give bankers an opportunity to ask questions related to the PPP program.

Today's edition featured Deb Bayles with the Stinson law firm, a CBA associate member.

Bank attorneys and experts will be on-hand to to provide the most information they are able, although we know not every question can yet be answered. Additional guidance and details from SBA are still awaited.

Future forums will continue on Tuesdays and Fridays at 10 a.m. through the month of April. Below is the link to join the meeting.

Join Zoom Meeting:
Meeting ID: 706 624 572
Dial by phone: 1 669 900 6833 |
Meeting ID: 706 624 572
Paycheck Protection Program Liquidity Facility

This presentation is about the Federal Reserve’s PPPLF

• The PPPLF provides term funding to depository institutions (DIs) that originate loans to small businesses (under the PPP).
• While the PPPLF supports the Small Business Administration’s Paycheck Protection Program (PPP) by providing funding to DIs that are PPP lenders

Speaker: Nicholas Sly, Assistant Vice President, Economist and Denver Branch Executive Federal Reserve Bank of Kansas City

When: April 15 3 p.m.
Price: Free

Paycheck Protection Program (PPP)

This webinar will answer key questions regarding the Paycheck Protection Program (PPP) eligibility, terms, applications and other related topics.

Speakers will include: Darlia Fogarty, President Compliance Alliance and Elizabeth Madlem, Associate General Counsel for Compliance Alliance

April 17 1 p.m.
Price: Free

To help guide the CBA Board of Directors, please take a couple minutes as your bank’s CEO (or designee) to complete this questionnaire regarding the industry's response to, and experience with COVID-19 lending.
ADA Litigation webinar
Your bank is still at risk

Banks remain vulnerable to litigation related to website and physical accessibility for Americans with disabilities and laws enacted to protect them.

Banks are vulnerable to these lawsuits, experts say, because they operate websites and mobile applications that promote products and services as well as let consumers conduct transactions. 

Attorney Ryan Sugden, with CBA associate member law firm Stinson, will provide information on how banks can address or insulate themselves from potential violation.

When:  Thursday, April 16, 9 a.m.
Presenter : Ryan Sugden, attorney, Stinson
Price : Free
Colorado Bankers Association
303-825-1575 | 303-825-1585