EXHIBIT B
DIRECT REVOLVING LOAN FUND PROGRAM PROJECTIONS

Revolving Loan Fund Capacity
Year 1 Beginning Balance = $1,000,000
Year 1   Year 2   Year 3   Year 4   Year 5
Beginning 1,000,000 761,419 501,695 284,731 280,268
Administrative Costs -50,000 -50,000 -50,000 -50,000 -50,000
Principle collected 27,569 100,906 187,773 277,901 324,393
Charge-Offs 0 -9,515 -13,759 -13,801 -12,913
Interest Earnings-investments 25,500 23,463 16,911 11,753 12,330
Interest Earnings-loans 8,351 25,420 42,111 49,684 47,731
Loans Originated -250,000 -350,000 -400,000 -280,000 -280,000
Balance-loanable funds 761,419 501,695 284,731 280,268 321,809
Outstanding Loans 222,431 475,726 687,953 690,052 645,659
at 12/31/year
                         
Projected # loans 50 70 80 90 100 390
Projected $ loans 250000 350000 400000 450000 500000 1950000
Actual # loans 50 70 80 56 56 312
Actual $ loans 250000 350000 400000 280000 280000 1560000

PROJECTIONS ASSUMPTIONS

Summary Table
  1. Beginning. Shows the beginning of year guaranty fund balance. Year 1=NIDRR grant + Match
  2. Annual program administrative costs.
  3. Principal Collected. Collections on outstanding loans (amortization schedule).
  4. Charge-Offs on outstanding loans. Assumes no charge-offs in Year 1, since only 6 months loan amortization. Thereafter, calculated at 2% of outstanding loans at year end. Somewhat overstates charge-offs because collateral recoveries are not considered.
  5. Interest Earnings-Investments. Earnings on funds not lent calculated at 3%.
  6. Interest Earnings-Loans. Collections on outstanding loans (amortization schedules).
  7. Loans Originated. Actual loans originated annually.
  8. Balance. Amount carried forward to originate new loans and to cover expenses.
  9. Outstanding Loans. Principle balance of loans outstanding at year end.
  10. The last four rows show projected loan volume vs. actual/capacity.

Other Assumptions

  1. $ 750,000 NIDRR grant and $250,000 matching grant.
  2. Interest rate on loans charged at 7%.
  3. The average size loan is $5000.
  4. The average loan term is 48 months.
  5. Loan originations. See summary table which would be supported by amortization worksheets, not attached. Projections place all loan originations on July 1 of each calendar year. This simulates originations occurring evenly through the 12 months of the year.

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