LV Hispanic leaders praise Wells Fargo loan commitment

Bob Shemeligian

Thursday, Jan. 29, 1998 | 9:42 a.m.

A Wells Fargo Bank national $1 billion loan program for Latin business owners is being hailed by Hispanic leaders as a much needed shot in the arm for ethnically diverse communities.

"Wells Fargo is putting up $6 billion over the next six years for unsecured loans," Jose Nino, president of the U.S. Hispanic Chamber of Commerce, told area Hispanic business leaders at a luncheon Tuesday at North Beach Cafe. "You should apply for it and get it. It's good working capital."

Samuel Culotta, a vice president at Wells Fargo, explained the bank started the Latino Loan Program this month after determining through a study that Hispanic business owners in every area of the nation except South Florida are "much less likely" than non-Hispanics to have ever borrowed or used credit for their business and more likely to be turned down for financing.

Nino agreed with the results of the study, noting that Hispanics are "twice as likely" to be turned down for financing than non-Hispanics.

Culotta said the loan program has been tailored to meet the needs of Hispanic small-business owners. He explained that collateral and tax forms are not required to apply for the unsecured loans.

Area Hispanic officials and business leaders hailed the program as a panacea to the stifling problems that affect Hispanic small business owners seeking financing.

"I think it's an excellent program, and I hope there is a concerted effort to make the community aware of this loan program through the media," said Isabel Pfeifer, a financial consultant.

Elisa Del Prado, president of The World Merchants, an importer of furs and precious stones, also praised the program as "fantastic" and "greatly needed," but she questioned whether some in the Latin business community would be able to afford the interest rates or adhere to some of the program's rules.

Interest rates range from one point over prime to 16 percent depending on credit history, and applicants must be in business for at least three years to be considered eligible for loans up to $100,000, according to program requirements.

Norberto Birman, vice president of Amil International of Nevada, agreed that some of the requirements could pose difficulties to some Hispanic business operators. He explained that some Hispanic small business owners have had trouble keeping their small businesses going for a period of three years, and have had to go to work elsewhere during slow seasons, and this should not hurt their chances to qualify for the loan.

Mario Garcia, manager of business assistance for the City of Las Vegas, said whatever funds are loaned to Latin business operators will be re-circulated through the community.

"We actually spend more money on consumer goods, based on a percentage of total income, than many other groups," Garcia said.

Otto Merida, executive director of the Latin Chamber of Commerce, said it's not just a matter of goodwill on the part of Wells Fargo that led to the Latin Loan Program. It was good sense.

Noting that projections are that one in four Nevadans and Americans will be Hispanic by the year 2020, Merida said, "This is where the action is, and if you ignore this market you will pay in lost business opportunities."

Ronald Montoya, chairman of the U.S. Hispanic Chamber of Commerce, said it is the responsibility of the local chambers to promote the loan program, and for other banks to follow suit.

"We consider this to be a pilot program," Montoya said.

Other banks that set aside money for special lending programs that benefit Hispanic business owners include Bank of America and U.S. Bank.

"We serve all segments of the population," said Paul Stowell, spokesman for Bank of America, who explained Bank of America has set aside $140 billion for community lending over the next 10 years.

"In Nevada, our portion of that money is about $5.6 billion, and $4 billion of it is earmarked for loans to small businesses," Stowell said.

Doreen Davis-Peterson, community investment manager for U.S. Bank, explained it conducts community forums to determine what financial needs are specific to each area.