Newtek Business Services Provides Update on Operations

Newtek Business Services Corp., an internally managed business development company (BDC), is working with its employees and portfolio companies to deal with the current challenging environment created by the spread of COVID-19.

Recently, the company tested and enacted its BC plan, without any impact to its business operations. The firm and its portfolio companies are fully operational and servicing its borrowers and customers without interruption.

Newtek and its portfolio companies employees’ health and safety are of importance, as is providing the service and support our borrowers and customers have come to expect. The firm has been able to affect social distancing in its offices by moving to an odd- and even-day work schedule. In addition, as a result of the prior planning by the company with the assistance of Newtek Technology Solutions and IPM, the company is able to support any of its employees’ need to work from home for extended periods of time, leveraging its secure VPN infrastructure and cloud-based phone system to access its systems and ensure that customer data is secure. It has been and will continue to be diligent in monitoring this evolving situation and take any necessary and appropriate actions to keep its employees safe and healthy, while also ensuring our business operations remain functional.

Barry Sloane, chairman, president and CEO, said: “Our referrals across the board, particularly our government loan program referrals have increased eight times to ten times in the last two weeks. In addition, our inbound call volume has increased by several multiples per day. We currently have the capacity to fund government-guaranteed loans to assist with the recovery of the small business community and the US economy. We plan on working closely with the Small Business Administration to point people in the right direction for DR. Important to note is the geographic and industry diversification of our SBA loan portfolio. Specifically, our SBA loan portfolio comprises up to 35% in the four most densely populated states of New York, California, TX and Florida.“

Sloane continued: “We look forward to working with clientele to ensure the health of our businesses in local communities in all 50 states. We are hopeful that the Bill that Senator Rubio has proposed, which could have many potential benefits to the small business community including up to a 90% government-guarantee on SBA loans, could support the U.S. economy and recovery time from the Coronavirus. Furthermore, our portfolio company (Newtek Merchant Solutions and Mobil Money) payment processing volume has been down approximately 10% since the beginning of the month, and we do expect further temporary deterioration in this business.“

He concluded: “Our interests are closely aligned with our shareholders, and we will continue to work through the ongoing impacts of Coronavirus, and provide the investment community with material updates as we navigate this challenging time.“