Banks slashed small business lending by $43 billion

The numbers back up what small business owners have been saying for two years: Main Street suffered a brutal credit crunch.

The total value of outstanding loans to small businesses plunged by $43 billion, or 6.2%, between June 2009 and June 2010, according to a report released this week by the Small Business Administration. That's a drop of $59 billion, or 8.3%, from June 2008.

The drop-off in small business loans came against an overall backdrop of reduced lending. Lending to large businesses -- measured by commercial loans of more than $1 million -- dropped by $156.2 billion, or 8.9%, between 2009 and 2010. Read more...