On Wednesday, April 1, 2020, Governor Edwards announced the availability of a new state-led loan program to provide loans to Louisiana small businesses in response to COVID-19. The Louisiana Loan Portfolio Guaranty Program (“LPGP”) is a partnership of the Louisiana Economic Development (“LED”), the Louisiana Bankers Association (“LBA”) and the Louisiana Public Facilities Authority (“LPFA”).
The LPGP currently has a total loan pool of $50 million, and through the LED, the state is providing a loan guaranty fund of $10 million to guaranty a portion of each participating bank’s loans. Members of the LBA will provide the loans and the LPFA will administer the program. Under the LPGP, loans of up to $100,000 are available to small businesses with fewer than 100 employees that are impacted by the COVID-19 crisis. The loan term is from 1 to 5 years; no payment is required for the first 180 days; and the loans will carry interest rates of no more than 3.5 percent. Currently, the deadline to apply for an LPGP loan is April 30, 2020. The LPGP is intended to complement to the federal stimulus programs.