Prosperity Bank: SBA Lending Record

Prosperity Bank, loan by loan in SBA data

Prosperity Bank is credited in SBA's files with 532 loans and $488.9 million in gross approvals between FY2017 and FY2026. All 532 are SBA 7(a) loans, with nothing under SBA 504. The file names TX as the lender's state. SBA publishes these figures as loans Prosperity Bank holds now or held last, and SBA backs Prosperity Bank's 532 loans. A 7(a) record is credited to the holder the loan is assigned to today, so a loan that changed hands shows the later holder. The page is a ledger of holdings. It does not describe how the lender underwrites, and it must not be read as a list of what the lender requires.

One state, mostly unclassified

The state table has a single large line: Texas, 526 loans. Of the 532, 292 fall outside the named classes. The limited-service restaurant leads the named ones with 51 loans, the full-service restaurant has 40, child care 20, coffee shops and snack bars 15 and medical offices 14.

What happened after approval

Cancellations, FY2017 to FY2024 approvals: 8.9% at least, and 8.9% again when undisbursed loans count as cancelled. Disbursed FY2017 through FY2021: 322 loans. Charge-off floor so far: 6.2%. Within five years of approval: 4.3%. While loans remain open, both rates may climb.

Study questions

A limited-service restaurant study, the nearest class at 51 loans, tests counter and drive-through sales, check size, labour margin and traffic counts at the site. A full-service restaurant study follows seat revenue set against the rent. A child care study looks at the pace of enrolment, staffing ratios and licensed places. A medical office study turns on provider capacity, payer mix and visit volume, with collections set against rent. For any of them, a base case and a weaker one should both show debt service coverage.

Limits of the record

With 292 loans in no named class and nearly the whole file in Texas, the record gives a borrower outside Texas, or in an unlisted property type, very little precedent. A study for such a project should be built on its own demand evidence and an appraisal that supports the value assumed, and should say plainly why this lender's holdings are relevant at all.

A closing note

In sum, 532 loans and $488.9 million held by one bank, nearly all in Texas, with a charge-off floor of 6.2% and a cancellation floor of 8.9%. The class table covers a minority of the loans. Nothing here describes the bank's credit policy. A borrower should come to Prosperity Bank, or to any lender, with a study that stands on its own: demand evidence, a costed budget, debt service coverage under stress, then an appraisal that agrees with the figures used.