USB - US Bancorp

[HJ]

I will be going to a presentation with David Moffett tomorrow (US Bancorp CEO 1993-2007 and Freddie Mac CEO 2008-2009) if anyone has any questions feel free to post them.

 

I have a couple, both credit card related:

 

1) Given USBancorp's position in merchant acquiring, Elevon is one of the biggest merchant acquirer out there, why hasn't USBancorp been more active in credit card lending to consumers? 

 

2) What's his thoughts on the competitive position of AXP vs. V vs. MA, in light of the recent Costco / AXP and Jetblue / AXP news.

 

Which presentation is this? 

 

Thanks

[LC]

Taking a seminar class in my last semester of my MBA, I believe Mr. Moffett is a contact of my professor. Thanks for the Q's I'll try to bring them up.

[LC]

Here are my notes from Moffett's presentation:

 

The entire presentation read like a Buffett letter. USB's strategy was to be a low cost bank. They are one of the lowest cost operators. Their strategy was to compete on price and they refused to compete on credit risk. They estimated their cost of capital at ~10% and their first priority was to earn that. Above that they would grow 50% organic and 50% by acquiring inefficient regional banks. The dividend yield provided a floor to their stock price and buybacks + expansion grew EPS. The market rewarded them by expanding their multiple. They used this to issue stock for acquisitions.

 

In 05 or so, Moffett et al looked at the credit spreads on housing related products and just saw the spreads falling off a cliff from ~220bp to 20bp. They went to their shareholders and essentially said, "we're not writing these loans, instead we're going to return 80-85% of earnings to shareholders." Many shareholders/the board were in disbelief given other banks were planning on continuing to expand their loan book. They jacked up the dividend and buybacks and that's what sold the shareholders. I asked about Buffett and Moffett said he was OK with their strategy, unlike other shareholders.

 

As an aside, Moffett said when Berkshire bought their stake, Buffett sent management a letter saying, "if you keep doing what you're doing, we'll be shareholders for life. We won't bother you or get in your way." Typical Buffett I suppose.

 

Moffett stressed their low-cost approach to all aspects of their business. Again, very Buffett. Their incentive structure was such that managers had goals to hit re: loan growth, earnings, etc. but if they went a nickel over their expense budget, no bonuses would be awarded. They would put a young guy earning $100k into positions where senior managers were earning 3x that.

 

HJ, Moffett essentially said that credit card lending was very profitable but exposed you to a lot of credit risk. Again, something they were/are? very leery of. Merchant processing is very different, high returns on capital but low risk. I wasn't able to ask about MA vs. V vs. AXP.

 

The sense I got was that Buffett's philosophy was palpable throughout USB's operations and capital allocation approach. They took/take a very disciplined and cost-focused approach to the business.

[benchmark]

Here are my notes from Moffett's presentation:

 

The entire presentation read like a Buffett letter. USB's strategy was to be a low cost bank. They are one of the lowest cost operators. Their strategy was to compete on price and they refused to compete on credit risk. They estimated their cost of capital at ~10% and their first priority was to earn that. Above that they would grow 50% organic and 50% by acquiring inefficient regional banks. The dividend yield provided a floor to their stock price and buybacks + expansion grew EPS. The market rewarded them by expanding their multiple. They used this to issue stock for acquisitions.

 

In 05 or so, Moffett et al looked at the credit spreads on housing related products and just saw the spreads falling off a cliff from ~220bp to 20bp. They went to their shareholders and essentially said, "we're not writing these loans, instead we're going to return 80-85% of earnings to shareholders." Many shareholders/the board were in disbelief given other banks were planning on continuing to expand their loan book. They jacked up the dividend and buybacks and that's what sold the shareholders. I asked about Buffett and Moffett said he was OK with their strategy, unlike other shareholders.

 

As an aside, Moffett said when Berkshire bought their stake, Buffett sent management a letter saying, "if you keep doing what you're doing, we'll be shareholders for life. We won't bother you or get in your way." Typical Buffett I suppose.

 

Moffett stressed their low-cost approach to all aspects of their business. Again, very Buffett. Their incentive structure was such that managers had goals to hit re: loan growth, earnings, etc. but if they went a nickel over their expense budget, no bonuses would be awarded. They would put a young guy earning $100k into positions where senior managers were earning 3x that.

 

HJ, Moffett essentially said that credit card lending was very profitable but exposed you to a lot of credit risk. Again, something they were/are? very leery of. Merchant processing is very different, high returns on capital but low risk. I wasn't able to ask about MA vs. V vs. AXP.

 

The sense I got was that Buffett's philosophy was palpable throughout USB's operations and capital allocation approach. They took/take a very disciplined and cost-focused approach to the business.

Thanks for the write up LC. I think USB is probably the best run bank, too bad that I didn't go all-in during 2007-8.

[HJ]

Here are my notes from Moffett's presentation:

 

The entire presentation read like a Buffett letter. USB's strategy was to be a low cost bank. They are one of the lowest cost operators. Their strategy was to compete on price and they refused to compete on credit risk. They estimated their cost of capital at ~10% and their first priority was to earn that. Above that they would grow 50% organic and 50% by acquiring inefficient regional banks. The dividend yield provided a floor to their stock price and buybacks + expansion grew EPS. The market rewarded them by expanding their multiple. They used this to issue stock for acquisitions.

 

In 05 or so, Moffett et al looked at the credit spreads on housing related products and just saw the spreads falling off a cliff from ~220bp to 20bp. They went to their shareholders and essentially said, "we're not writing these loans, instead we're going to return 80-85% of earnings to shareholders." Many shareholders/the board were in disbelief given other banks were planning on continuing to expand their loan book. They jacked up the dividend and buybacks and that's what sold the shareholders. I asked about Buffett and Moffett said he was OK with their strategy, unlike other shareholders.

 

As an aside, Moffett said when Berkshire bought their stake, Buffett sent management a letter saying, "if you keep doing what you're doing, we'll be shareholders for life. We won't bother you or get in your way." Typical Buffett I suppose.

 

Moffett stressed their low-cost approach to all aspects of their business. Again, very Buffett. Their incentive structure was such that managers had goals to hit re: loan growth, earnings, etc. but if they went a nickel over their expense budget, no bonuses would be awarded. They would put a young guy earning $100k into positions where senior managers were earning 3x that.

 

HJ, Moffett essentially said that credit card lending was very profitable but exposed you to a lot of credit risk. Again, something they were/are? very leery of. Merchant processing is very different, high returns on capital but low risk. I wasn't able to ask about MA vs. V vs. AXP.

 

The sense I got was that Buffett's philosophy was palpable throughout USB's operations and capital allocation approach. They took/take a very disciplined and cost-focused approach to the business.

 

LC,  Thank you for the post, and asking the questions.  USB is an impressive organization. 

[walkie518]

Bringing this topic back!

 

I bought shares of USB this morning.

 

The thesis is simply that ROA is 50% higher than what one expects from a bank and it's not just from its merchant processing, investment management, and credit/debit card businesses.  Sure, those businesses help, but USB seems to be earning $10.8B of interest income on $277B of loans...nearly a 4% net interest margin.  The trickle down after expenses reflects in the ROA.

 

That said, half bank half custodian/trust with $20B of cash and returning most income to shareholders via dividends and buybacks.

[walkie518]

I was thumbing through the annual this weekend...

 

Does anyone have a feel for why the likelihood for the bank's off-balance sheet arrangements, where USB has extended credit agreements that the bank believes will never be called?  I tried looking for more information but couldn't seem to find anything in the notes... what kind of agreements are these and why do they sum to such a large number relative to the rest of the bank?  Is this the justification for so much derivative exposure?

 

There are many indications that the bank is very, very conservative, but this item seemed a little odd...any help appreciated...

[Guest Schwab711]

I was thumbing through the annual this weekend...

 

Does anyone have a feel for why the likelihood for the bank's off-balance sheet arrangements, where USB has extended credit agreements that the bank believes will never be called?  I tried looking for more information but couldn't seem to find anything in the notes... what kind of agreements are these and why do they sum to such a large number relative to the rest of the bank?  Is this the justification for so much derivative exposure?

 

There are many indications that the bank is very, very conservative, but this item seemed a little odd...any help appreciated...

 

I don't see the exact phrase on "unlikely to be called" but I think I understand how they invest their capital. Here's how I looked at their off-balance sheet liabilities. Let me know if I missed commitments that you were referring to. I think they look pretty conservative for a bank their size.

 

Most of the off-balance sheet liabilities look like they come from a few sources:

1. USB pools and sells most of their mortgage loans for GSE securities and strips of the MSR rights. It's common for banks that engage in pool-and-sell to pre-sell pools of mortgages, which may create an off-balance sheet liability. USB has roughly $46b in mortgages in the books and $235b in nominal MSR rights, so I'd guess a large portion of their mortgage pipeline goes to MBS bundling activities.

 

Since USB likely pre-sells a meaningful amount of mortgage pools, they probably sell <1 year FRA or Interest Rate Futures because they have future lending agreements and want to limit interest rate risk in the interim period. In the derivatives section, we can see their $15b short FRAs position is just less than 1 year and their $1.6b long FRA position is roughly 1 month. This makes sense since the timeline is generally: (1) USB pre-sells mortgage pools for a small premium; (2) hedges the future lending requirement by locking in a forward rate (short FRA); and (3) locking in a future investment rate for the cash inflow from sale until the bank has something to lend to (1 month long FRAs).

 

When looking at bank derivative books, I like to try to think of what positions and maturities we should expect to see given their activities and compare that expectation to the actual book. In USB's case, their derivatives book is relatively small and very much matches their mortgage pool-and-sell and MSR stripping activities.

 

2. Loan commitments are off-balance sheet liabilities in that they technically can be drawn upon before the bank lowers or cancels the undrawn balance (if they are contractually allowed to). USB has $22b in credit card balances outstanding, so we can probably assume they have $40b-$80b in additional credit card "commitments" or undrawn balances. These are some of the easiest lines to lower or cancel.

 

3. There's probably a large amount in aggregate of loan commitments for HELOCs, commercial and consumer revolvers, and milestone-based C&I in here, but I'd think the largest balance would be undrawn credit card commitments. The former are relatively more difficult to lower or cancel undrawn balances, but it's not a huge liquidity issue. USB has plenty of diverse income streams.

 

4. Finally, they mention $12b or so in Letter of Credit (I've seen it written as both LOC and LC). These are the least concerning OBS liabilities since the only risk is settlement risk due to fraud or counterparty bankruptcy. The non-fraud settlement risk is the chance your customer's transacting party's bank fails in the couple of days it takes to confirm delivery and payments. It's a really really small risk. For USB, the $12b or so in outstanding commitments seem too small to effect their treasury, even in times of low liquidity.

 

Note: Doesn't look like OBS liability since they state the bank doesn't guarantee them but USB mentions tax-advantage VIEs with assets of $3.5b and equity of $1b. I don't know much about this type of activity and I'm not even sure I know what they are referring to.

[walkie518]

I was thumbing through the annual this weekend...

 

Does anyone have a feel for why the likelihood for the bank's off-balance sheet arrangements, where USB has extended credit agreements that the bank believes will never be called?  I tried looking for more information but couldn't seem to find anything in the notes... what kind of agreements are these and why do they sum to such a large number relative to the rest of the bank?  Is this the justification for so much derivative exposure?

 

There are many indications that the bank is very, very conservative, but this item seemed a little odd...any help appreciated...

 

I don't see the exact phrase on "unlikely to be called" but I think I understand how they invest their capital. Here's how I looked at their off-balance sheet liabilities. Let me know if I missed commitments that you were referring to. I think they look pretty conservative for a bank their size.

 

Most of the off-balance sheet liabilities look like they come from a few sources:

1. USB pools and sells most of their mortgage loans for GSE securities and strips of the MSR rights. It's common for banks that engage in pool-and-sell to pre-sell pools of mortgages, which may create an off-balance sheet liability. USB has roughly $46b in mortgages in the books and $235b in nominal MSR rights, so I'd guess a large portion of their mortgage pipeline goes to MBS bundling activities.

 

Since USB likely pre-sells a meaningful amount of mortgage pools, they probably sell <1 year FRA or Interest Rate Futures because they have future lending agreements and want to limit interest rate risk in the interim period. In the derivatives section, we can see their $15b short FRAs position is just less than 1 year and their $1.6b long FRA position is roughly 1 month. This makes sense since the timeline is generally: (1) USB pre-sells mortgage pools for a small premium; (2) hedges the future lending requirement by locking in a forward rate (short FRA); and (3) locking in a future investment rate for the cash inflow from sale until the bank has something to lend to (1 month long FRAs).

 

When looking at bank derivative books, I like to try to think of what positions and maturities we should expect to see given their activities and compare that expectation to the actual book. In USB's case, their derivatives book is relatively small and very much matches their mortgage pool-and-sell and MSR stripping activities.

 

2. Loan commitments are off-balance sheet liabilities in that they technically can be drawn upon before the bank lowers or cancels the undrawn balance (if they are contractually allowed to). USB has $22b in credit card balances outstanding, so we can probably assume they have $40b-$80b in additional credit card "commitments" or undrawn balances. These are some of the easiest lines to lower or cancel.

 

3. There's probably a large amount in aggregate of loan commitments for HELOCs, commercial and consumer revolvers, and milestone-based C&I in here, but I'd think the largest balance would be undrawn credit card commitments. The former are relatively more difficult to lower or cancel undrawn balances, but it's not a huge liquidity issue. USB has plenty of diverse income streams.

 

4. Finally, they mention $12b or so in Letter of Credit (I've seen it written as both LOC and LC). These are the least concerning OBS liabilities since the only risk is settlement risk due to fraud or counterparty bankruptcy. The non-fraud settlement risk is the chance your customer's transacting party's bank fails in the couple of days it takes to confirm delivery and payments. It's a really really small risk. For USB, the $12b or so in outstanding commitments seem too small to effect their treasury, even in times of low liquidity.

 

Note: Doesn't look like OBS liability since they state the bank doesn't guarantee them but USB mentions tax-advantage VIEs with assets of $3.5b and equity of $1b. I don't know much about this type of activity and I'm not even sure I know what they are referring to.

 

Thanks Schwab for your thoughts...really appreciated and I will need to digest and revert and reconcile with some of the other thoughts I note below.

 

The paragraph in question is on pg 57 and the actual language is "commitments to extend credit expire without being drawn [...]":

 

"Commitments to extend credit are legally binding and generally have fixed

expiration dates or other termination clauses. Many of the Company’s

commitments to extend credit expire without being drawn and, therefore, total

commitment amounts do not necessarily represent future liquidity requirements or

the Company’s exposure to credit loss. Commitments to extend credit also include

consumer credit lines that are cancelable upon notification to the consumer. Total

contractual amounts of commitments to extend credit at December 31, 2017 were

$305.2 billion. The Company also issues and confirms various types of letters of

credit, including standby and commercial. Total contractual amounts of letters of

credit at December 31, 2017 were $11.3 billion. For more information on the

Company’s commitments to extend credit and letters of credit, refer to Note 22 in

the Notes to Consolidated Financial Statements. [bold is my emphasis]"

 

 

Note 22 indicates that $129.5B of off-balance sheet commitments consist of commercial and commercial real estate loans. 

 

These would be the residues of security sales you mentioned?  This is only "commercial"?  Is the bank calling some deals "commercial" containing residential assets (eg mortgage pool of single-family rentals?)

 

Note 9 indicates that the bank services $234.7B of residential mortgage loans and the MSR fair value is $2.6B.  "Commercial" by name doesn't seem to be in here.  (Side note: I compared w/Nationstar to get a feel and Nationstar held $2.9B of MSRs at fair value...this would indicate that the MSR business for USB might be worth $1.6B as a standalone business). 

 

The retail off-balance sheet credit card loans are $106B.  This is a lot of money, but in line with its categorization: unlikely to be drawn as people spend however they please and most cards do not get used to the extent of available credit. 

 

The $12B LOC doesn't phase me, but the lack of disclosure on that which might never be drawn seems odd for such a transparent and conservative bank?

 

[Guest Schwab711]

Awesome, thanks for finding this. Digging in to this, it looks like my knowledge might be outdated. I'm also rusty at this. I'll try to correct what I screwed up. I tried to check what I used to know against current standards. Just a heads up that I might have missed some change and I might be wrong.

 

Accounting for pre-approved mortgages that are held-for-sale is done under ASC 815 now [i learned FAS 133]. See Crowe Horwath (p.3) for FAS 133 definiton. See 2nd link for P/L summary based on updated accounting (#2 is a good explanation about what I tried to say about USB's derivative book and locking interest rates).

 

ASC 815 and FAS 133 look identical for our purposes so I think the FAS 133 link (3rd link) is the best summary of the types of commitments included in USB's "Loan Commitments".

 

https://www.crowehorwath.com/folio-pdf/MortgageBankingAccounting_FW14404F5.pdf

https://www.wilwinn.com/assets/documents/accounting-and-regulatory-reporting-for-mortgage-ban.pdf

http://www.fasb.org/derivatives/issuec13.shtml

 

HFS Definition:

https://www.occ.treas.gov/news-issuances/bulletins/2001/bulletin-2001-15.html

Note: HFS accounting is not AFS. HFS uses the Temporary Impairment and Other Than Temporary Impairment language.

 

 

Your Questions:

The Wilwinn link lays out how HFS mortgage commitments should be accounted for in P/L.

 

It looks like I don't remember how commitments accounting works since USB records a very small residential mortgage commitment balance on p.134 and I didn't expect that. I'll have to look in to this more.

 

Commercial Loans are defined as: Commercial Loans (term and revolver), Commercial Real Estate, and Commercial & Industrial (development projects and such, including 1-4 family and multifamily developments), multifamily, raw land, and all non-residential real estate lending ("nonfarm nonresidential property where the primary or a significant source of repayment is derived from rental income associated with the property or the proceeds of the sale, refinancing, or permanent financing of the property").

I think non-owner-occupied 1-4 family is included (I can't find a definitive statement on this but I'm pretty sure and it meets the Fed definition in quotes).

 

Owner-occupied 1-4 is Consumer RE.

 

https://www.federalreserve.gov/newsevents/testimony/bies20060914a.htm

 

I believe the definitions for 1-4 Family is literally 1 to 4 residential unit buildings and multifamily is 5+ residential unit buildings.

 

https://www.occ.gov/publications/publications-by-type/comptrollers-handbook/commercial-real-estate-lending/pub-ch-commercial-real-estate.pdf

 

Credit card commitments of $100b+ might be good since that seems to imply a below average utilization (low utilization generally means above average quality customers by FICO score). There's other factors but that's the high level thinking the bank officer would go through if everything else looks fine (as opposed to overextending credit to relatively bad borrowers, if I'm remembering correctly).

 

If you look at p.96, the difference between Total Outstanding Commitments and Total Loans for the Pass/SM/C table implies that just $2.3b of the $300b+ total commitments are committed to SM or C loans. I don't remember what a good percentage should be but it gives you an idea of what is actually additionally committed to bad loans.

 

In the commitment table on p.134, I'd guess most commercial loan commitments are revolvers and milestone C&I (I'm not sure if this is a standard term), take-outs, and stand-by commitments (just a guess). A lot of big companies have just-in-case revolvers and so maybe USB is competitive in that space? I don't know their lending habits well-enough.

 

 

Here's the Fed's Accounting Manual for Financial Companies:

https://www.federalreserve.gov/federal-reserve-banks/fam/chapter-8-special-topics.htm#xsubsection-110-832b8ca8

 

One last link to FDIC because I like the definitions they provide for some of these terms and they talk about mortgage pooling (it's old but the definitions are still good):

https://www.fdic.gov/regulations/safety/manual/section3-8.pdf

[walkie518]

certainly some great reference material here!

 

the documentation for a revolver that the bank never expects to be drawn must contain terms that are restrictive enough (or the rate high enough) that make it a real last-option, but this would have to be understood in advance

 

I would imagine that should USB have as many commitments as they report, they must be good at not lending money!  This could also speak to non-interest fee income as most have non-use fees on capacity...I will dig around and see if I can find something that looks like that...

[ERICOPOLY]

I have been reading today about USB being better positioned to deal with Covid-19 recession:

 

https://www.bizjournals.com/twincities/news/2020/03/20/analysts-u-s-bank-in-better-position-to-deal.html

 

I also saw that they have expanded their footprint recently:

 

As State Farm bows out, U.S. Bank seizes an expansion opportunity

 

https://www.americanbanker.com/news/as-state-farm-bows-out-u-s-bank-seizes-an-expansion-opportunity

 

 

[Spekulatius]

I have been reading today about USB being better positioned to deal with Covid-19 recession:

 

https://www.bizjournals.com/twincities/news/2020/03/20/analysts-u-s-bank-in-better-position-to-deal.html

 

I also saw that they have expanded their footprint recently:

 

As State Farm bows out, U.S. Bank seizes an expansion opportunity

 

https://www.americanbanker.com/news/as-state-farm-bows-out-u-s-bank-seizes-an-expansion-opportunity

 

USB is less dependent on interest income than WFC (fee income, payments etc.). It should hold up better. I avoid banks right now but that’s one I keep an eye on.

[LC]

Financially USB looks great for reasons Spek mentions. However I always thought it was a poor value-proposition for customers though. Where do you think all that fee income originates from? They nickel & dime customers to do basic functions like transfer money to external accounts.

[Spekulatius]

Financially USB looks great for reasons Spek mentions. However I always thought it was a poor value-proposition for customers though. Where do you think all that fee income originates from? They nickel & dime customers to do basic functions like transfer money to external accounts.

 

So does Wells Fargo. That said, I was customer with US Bank once and wasn’t impressed.

[Dalal.Holdings]

What is this bank's exposure to small business loans? Does not seem insignificant at first glance...

 

Edit:

https://www.sba.gov/sites/default/files/articles/FY18_Lender_stats.pdf

 

https://www.sba.gov/sites/default/files/articles/FY19_Lender_stats.pdf

[LearningMachine]

Thanks Dalal for bringing up SBA loans.  For context, borrower's 10% downpayment and government's 40% contribution will be first in line to be wiped out before USB's 50% contribution to these SBA loans.

 

That said, I'm worried about USB going under CET1 regulatory capital given their out-sized exposure to commercial real estate and commercial loans in general compared to other banks.  With remote work going well, companies are planning to reduce office footprint, and planning to hire workers from anywhere instead of having employees rent expensive apartments close to company location.

 

Also, USB has lower CET1 Capital than other big banks at 9.0% to absorb losses as of 2020 Q1.  In their 2019 Annual report, they only had $35.7B in Tier 1 Capital.  Even small losses in their portfolio of $103.86 Billion Commercial Loans, $39.75 Billion Commercial Real Estate loans, $57 Billion Other Retail loans can easily cut into this small Tier 1 Capital.

 

Is anyone else not worried?

 

[Junto]

You have to consider that the SBA / Government is making payments on behalf of borrowers in the 7A and 504 programs right now. This would be a strength not a weakness to their credits as it provides further liquidity to these borrowers impacted.  The ones to be concerned about are the small business loans that are not covered by SBA.  Furthermore those concentrated in industries most impacted. USB does have the benefit to a fair amount of fee income and they are good underwriters of credit. I would not bet against their team. I am in their home market and we compete quite frequently against them.

 

Cyclical businesses will be impacted in times like these. I think when we get through this economic cycle the market will be impressed with how the banks have managed through. There will be some that haven't done as well and those will be the more levered depository bases that fund more concentrated loan bases. A common theme through every cycle. It is not new and the banks debt levels are much more manageable and the regulatory flexibility in this cycle in unheard of. We did not see this in the great recession. Regulators pressed the banks hard and did not allow for payment forbearance and modifications without any regulatory impact. To this effect, watch banks that show materially increased accrued interest in coming quarters. This will reflect higher loans in payment forbearance.

 

Details on SBA payments below:

 

"As part of our coronavirus debt relief efforts, the SBA will pay 6 months of principal, interest, and any associated fees that borrowers owe for all current 7(a), 504, and Microloans in regular servicing status as well as new 7(a), 504, and Microloans disbursed prior to September 27, 2020. This relief is not available for Paycheck Protection Program loans or Economic Injury Disaster loans. Borrowers do not need to apply for this assistance. It will be automatically provided as follows:

 

• For loans not on deferment, SBA will begin making payments with the next payment due on the loan and will make six monthly payments.
  
• For loans currently on deferment, SBA will begin making payments with the next payment due after the deferment period has ended, and will make six monthly payments.
  
• For loans made after March 27, 2020 and fully disbursed prior to September 27, 2020, SBA will begin making payments with the first payment due on the loan and will make six monthly payments.
  

SBA has notified 7(a), 504 and Microloan Lenders that it will pay these borrower loan payments. Lenders have been instructed to refrain from collecting loan payments from borrowers. If a borrower's payment was collected after March 27, 2020, lenders were instructed to inform the borrower that they have the option of having the loan payment returned by the lender or applying the loan payment to further reduce the loan balance after SBA's payment.

 

Borrowers should contact their lender if they have any questions regarding this payment relief."

 

https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/sba-debt-relief