The move comes at a time when banks are trying to repair an image tarnished by their role in the financial crisis and the massive government aid they received. They face criticism for cutting back on lending, while at the same time demand for loans, particularly from small businesses, remains tepid.
Still, President Barack Obama has said that small-business lending is a key element in the economic recovery, and several banks have announced initiatives to increase their lending. Vikram Pandit, Citi's chief executive, said in a press release, "We recognize the vital role small businesses play in our economy."
Citi said it committed $7 billion in loans to small business this year, $8 billion next year and $9 billion in 2013. Last year, the company made $6 billion in small-business loans, and in 2009 the amount was $4.5 billion.
U.S. Vice President Joe Biden and Small Business Administration Administrator Karen Mills met with 13 banks in Cleveland on Tuesday. After the meeting, KeyCorp, a big regional bank in the Midwest and Alaska, said it would provide $5 billion to small-business owners over the next three years; M&T Bank Corp. of Buffalo, N.Y., said it would increase small-business lending by $50 million from 2010's level in each of the next three years.
J.P. Morgan Chase & Co. pledged in April to provide $12 billion in small-business loans this year alone — 20% more than last year's commitment.
