Banks expect new coronavirus PPP loans to run out in days: Gasparino
Sources tell FOX Business’ Charlie Gasparino the Payroll Protection Program will run out of money in days and that some of the money is still getting into the ‘wrong hands.’
Get all the latest news on coronavirus and more delivered daily to your inbox. Sign up here.
Continue Reading Below
Hot dog maker Nathan’s Famous Inc. said Monday it would return a loan it received under the Paycheck Protection Program after larger companies drew criticism for applying for relief meant for small businesses impacted by the coronavirus pandemic.
Nathan’s applied for and received a loan from the U.S. Small Business Administration worth about $1.2 million, according to an SEC 8-K filing. The company said it returned the money after the SBA issued new guidance on April 23 that larger companies with access to outside capital should return the money if they couldn’t demonstrate it was necessary to maintain operations.
LAKERS TO RETURN $4.6M SMALL BUSINESS LOAN
“In light of the New Guidance, the Company has determined to repay and return the entire amount of the PPP Loan to the Lender,” Nathan’s said in a filing.
The SBA hit its initial $349 billion lending limit less than two weeks after the PPP initiative began. Many small businesses were unable to secure a loan before the money ran out, even as larger chains secured relief.
EX-SAINTS STAR MARQUES COLSTON'S QUARANTINE ROUTINE
Nathan’s was one of several notable companies to return PPP funds in recent days. The NBA’s Los Angeles Lakers and prominent restaurant chains such as Ruth’s Chris Steak House, PotBelly, Shake Shack and Sweetgreen all returned funds.
A second round of PPP relief began Monday.
Nathan’s acknowledged in the filings the pandemic has disrupted its business operations with the “majority” of its franchised locations forced to close in order to comply with public health guidance. The company expects a negative impact to sales at those locations in the near future.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
“Since the situation around the COVID-19 virus is constantly changing, we may implement additional measures to ensure the safety of our team members and guests over time,” Nathan’s said. “We also expect to realize declines in sales and profits from our Branded Product Program during this period as many of our customers operate in venues that are currently closed and may be slow to reopen, such as professional sports venues, amusement parks, shopping malls and movie theaters.”
CLICK HERE TO READ MORE ON FOX BUSINESS
Source: Read Full Article