Alaska’s fate in massive Paycheck Protection Program rests on the shoulders of local bankers

Northrim Chief Administration Officer Amber Zins works from a desk in the lower level of her South Anchorage home. She says her children sometimes crash her teleconferences. (Photo courtesy Ryan Zins)

Banks are processing Paycheck Protection Program applications again this week, racing to press their loans through the Small Business Administration before the fund is depleted for a second time.

The government-backed bank loans are attractive to businesses trying to survive the coronavirus pandemic, because they can become grants if spent on payroll.

Northrim Bank made 1,300 loans before the money ran out for the first round of the Paycheck Protection Program. The massive loan-a-thon for the Anchorage-based bank — the equivalent of three years’ worth of applications, in less than two weeks — required people to do jobs they never thought they’d do.

“I would say 80% of our employees are directly involved in the process in some capacity or another,” said Northrim Chief Administrative Officer Amber Zins. “It was completely all-hands-on-deck.”

Some employees in the IT department — people who normally maintain Northrim’s electronic networks or read computer code — were drafted to review loans to ensure compliance with program rules. Zins said attention to detail and precision were already part of their skill set, so they were good at it.

Northrim and other banks are again racing to press their customers’ loans through Small Business Administration. Demand definitely exceeds supply. Everyone knows the $310 billion Congress sent to replenish the program will run out soon.

The PPP is the centerpiece of the relief package Congress adopted, not just to help small businesses but to inject cash into the American economy and prevent it from seizing.

The program is designed to cover a company’s payroll for eight weeks. How that money flows, and which communities it flows to, depends on the ingenuity and industry of bank employees.

Amber Zins was Northrim’s HR director and was promoted just before the Paycheck Protection Program started. (Photo courtesy Ryan Zins)

Like most of Northrim’s staff, Zins is working from home. In her case, that’s a room in the lower level of her South Anchorage home, next to an exercise equipment and a futon. Her kids sometimes crash her teleconferences. And these days, “bankers’ hours” are often 12 or 14 hours a day, seven days a week.

“It’s hard working from home when you’re working this much because you feel like you wake up and you come down to your home office and then you’re here until you crawl upstairs and go back to your bed,” Zins said. “And I think a lot of our employees are going through that.”

Not that she’s complaining. She feels fortunate to have a job when so many Alaskans are losing theirs.

The Small Business Administration pays banks a fee to process these loans — 1% of the value on large loans, 5% on small ones, so for round one, Northrim took in somewhere between $3 million and $15 million. That’s not insignificant for a bank with total revenues last quarter of $22 million.

“I wouldn’t look at it so much as a money maker, but I think we’ll be compensated for the resources and the time that we are investing into this process,” said Northrim Chief Lending Officer Mike Huston.

The bank’s employees are driven to leave no loan unprocessed, he said, in part because they know businesses are struggling and many Alaska workers have already been laid off.

This isn’t pure altruism: Banks don’t do well when an economy goes down the tubes. But Huston said the motivation of Northrim employees aligns with the purpose of the PPP itself — to keep the paychecks flowing in Alaska, at least for eight more weeks.

“And right now, with the amount of uncertainty that there is, having the ability to keep your job for a while longer … I think has a tremendous impact not just on the economy, but also on the the psyche of the community,” Huston said.

Northrim Chief Lending Officer Mike Huston in his home office (Photo courtesy Lora Huston)

Amber Zins came up for air recently and decided to take her young kids across the city, for a walk in Earthquake Park.

“Driving over there and driving back, it was very incredible to me … because every corner of town that we drove past, I recognized a name,” she said.

The names on the business signs were in the spreadsheets she’d been working with. The PPP loan applicants were everywhere.

“It was really a big moment for me, in that all the work is paying off and what we’re doing is coming home to the businesses that I go and visit and that I see every day,” she said.

Northrim isn’t the only Alaska lender bustling to process PPP applications. The 1,300 loans it made in round one amount to a quarter of the state’s total, and a third by value. But Northrim is the only Alaska bank that’s regulated as a publicly traded company, so it’s the only one that has to disclose its numbers.

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