Yes, amount at origination not at time of purchase is what is considered to determine if the loan is a small business loan. But you also REPORT amount at origination, not purchase.
Last edited by Kathleen B; 08/25/11 12:50 PM.
Examiners will however use amount at purchase to include in the bank's volume numbers. See the FAQ on this topic below.
From the CRA FAQ:
§ll.42(a)(2)—1: When an
institution purchases a small business
or small farm loan, in whole or in part,
which amount should the institution
collect and report—the original amount
of the loan or the amount at purchase?
A1. When collecting and reporting
information on purchased small
business and small farm loans,
including loan participations, an
institution collects and reports the
amount of the loan at origination, not at
the time of purchase. This is consistent
with the Call Report’s and TFR’s use of
the ‘‘original amount of the loan’’ to
determine whether a loan should be
reported as a ‘‘loan to a small business’’
or a ‘‘loan to a small farm’’ and in which
loan size category a loan should be
reported. When assessing the volume of
small business and small farm loan
purchases for purposes of evaluating
lending test performance under CRA,
however, examiners will evaluate an
institution’s activity based on the
amounts at purchase.