Banner County Bank is one of two Nebraska community banks to receive money through the Small Business Lending Fund. The SBLF, established as part of the Small Business Jobs Act, encourages community banks to increase lending to small business. The goal is to help companies start up or expand, thereby creating jobs.

"We're excited," said Banner County Bank president Roger Wynne of the $2.4 million in additional lending availability. "This gives us more flexibility and strengthens the capital base of the bank."

Many analysts consider small businesses the cornerstone of economic growth. It is estimated they employ up to half of all Americans in the work force and account for roughly 60 percent of job creation. In small towns, however, funding through loans can sometimes be difficult for such businesses to achieve, depending upon the strength of community banks.

“Access to capital is critical to ensuring small businesses can invest, expand, and hire in their local communities,” said Deputy Secretary Neal S. Wolin. “These funds will help unlock credit for Main Street entrepreneurs to support private sector growth and job creation.”

The SBLF helps small businesses by providing capital to community banks that hold under $10 billion in assets. The dividend rate a community bank pays on SBLF funding is reduced as that bank increases its lending to small businesses--providing a strong incentive for new lending to small businesses.

"You have to administer the program to make it work," Wynne said, explaining that the bank must still follow its fundamental principles in determining loan approval. But the decreasing dividend rate is indeed a powerful incentive.

"It's basically this: the Treasury Department invests in the bank," he added.

Banks that qualify for the SBLF program must be sound and free of regulatory trouble. Adbanc in Ogallala also received funds--$21.9 million--and others will follow over the coming weeks.

The SBLF was signed into law by President Barack Obama as part of a  comprehensive agenda to help small businesses access the capital they need to invest and hire. The State Small Business Credit Initiative (SSBCI), which is also a key part of the Small Business Jobs Act, allocates $1.5 billion to new and existing state programs that will leverage private financing to spur $15 billion in new lending to small businesses and small manufacturers.  A total of 54 states and territories applied to take part in the SSBCI and 21 states have already had their applications approved for $686 million in SSBCI funding.

For Banner County Bank, which was able to show steady loan growth before receiving Treasury funds, Wynne believes the additional amount will give them the "opportunity to do more."