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the administration about how to implement this proposal.
The overwhelming majority of our regional and community banks had absolutely nothing to do with the poor decisions and excesses that swept Wall Street in recent years and helped trigger our economic meltdown. And communitybased banks have extensive experience in evaluating and managing small business loans.
My initiative would require these local banks to put up some of their own money and assume some of the risk because I believe it is important that they have some “skin in the game.” For instance, I have suggested requiring banks to contribute at least 20 percent of their own money and assume “first-dollar loss.” This will ensure that banks do not relax their credit standards, or offer loans to otherwise uncreditworthy customers, simply to access federal dollars designated for small business loans.
We also propose that these TARP funds should remain off the balance sheet so banks cannot use the funds simply to bolster their own capital. Additionally, funds should be time-limited, which will ensure
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