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Appendix: Mission-Oriented Banks in Texas and Underserved Businesses: Lessons from the Paycheck Protection Program

This appendix accompanies the report Mission-Oriented Banks in Texas and Underserved Businesses: Lessons from the Paycheck Protection Program.
Table 1: Odds Ratios for Lending by a Community Financial Institution
  (1)
All CFIs Odds Ratio
(95% confidence interval)		 (2)
MDI Odds Ratio
(95% confidence interval)		 (3)
CDFI Odds Ratio
(95% confidence interval)
Firm Characteristics
Microfirm0.76***
(0.74, 0.78)		0.73***
(0.71, 0.75)		1.47***
(1.38, 1.56)
Start-up0.86***
(0.82, 0.90)		0.68***
(0.64, 0.72)		6.89***
(6.13, 7.75)
Nonprofit0.84***
(0.78, 0.91)		0.95
(0.87, 01.03)		0.84**
(0.71, 0.99)
Leisure and hospitality1.50***
(1.46, 1.54)		1.90***
(1.84, 1.96)		1.11***
(1.08, 1.15)
Loan characteristics
First draw PPP2.86***
(2.80, 2.91) 		0.54***
(0.52, 0.56) 		4.53***
(4.41, 4.65)
Higher share of loan devoted to payroll0.04***
(0.04, 0.04)		0.06***
(0.05, 0.07)		0.00***
(0.00, 0.00)
Date approved1.01***
(1.01, 1.01)		0.99***
(0.99, 0.99)		1.02***
(1.02, 1.02)
Less than $150,0001.55***
(1.48, 1.62)		1.63***
(1.56, 1.72)		1.25***
(1.11, 1.40)
Business Location Characteristics
Rural0.87***
(0.84, 0.89)		1.08**
(1.02, 1.13)		0.72***
(0.69, 0.74)
LMI neighborhood0.95***
(0.94, 0.97) 		0.79***
(0.77, 0.82)		0.95***
(0.93, 0.97)
Share of residents of color in ZIP1.01***
(1.01, 1.01)		1.02***
(1.02, 1.02)		1.01***
(1.00, 1.01)
Unemployment rate (county)1.22***
(1.21, 1.23)		1.43***
(1.42, 1.44)		1.09***
(1.08, 1.10)
Total number of CFIs in city1.00***
(1.00, 1.01)		1.00***
(1.00, 1.00)		1.00***
(1.00, 1.00)
Observations868,538868,538868,538
McFadden’s pseudo R20.170.200.27
*Denotes statistical significance at the 90 percent confidence level.
**Denotes statistical significance at the 95 percent confidence level.
***Denotes statistical significance at the 99 percent confidence level.
Table 2. Odds Ratios for Full and Partial PPP Loan Forgiveness

 

(1)
Low Forgiveness Odds Ratio
(95% confidence interval)		(2)
No Forgiveness Odds Ratio
(95% confidence interval)
Firm Characteristics
Microfirm1.44***
(1.38, 1.50)		1.41***
(1.35, 1.47)
Start-up1.62***
(1.56, 1.67)		1.55***
(1.49, 1.60)
Nonprofit0.62***
(0.55, 0.70)		0.59***
(0.52, 0.67)
Leisure and hospitality1.26***
(1.20, 1.32)		1.12***
(1.06, 1.19)
Loan characteristics
Higher share of loan devoted to payroll2.17***
(1.85, 2.54)		2.24***
(1.89, 2.67)
Date approved1.02***
(1.02, 1.02)		1.02***
(1.02, 1.02)
Less than $150,0000.65***
(0.61, 0.68)		0.60***
(0.56, 0.63)
Top 10 bank1.01
(0.97, 1.05)		0.89***
(0.86, 0.93)
MDI or CDFI0.43***
(0.39, 0.48)		0.34***
(0.30, 0.39)
Business Location Characteristics
Rural0.95*
(0.90, 1.00)		0.90**
(0.85, 0.96)
LMI neighborhood0.98
(0.88, 1.10)		1.03
(0.92, 1.16)
Total PPP loans approved in ZIP1.00
(0.99, 1.01)		1.01
(0.99, 1.01)
Share of residents of color in ZIP1.01***
(1.01, 1.01)		1.01***
(1.01, 1.01)
Unemployment rate (county)1.01***
(1.00, 1.03)		 1.03***
(1.02, 1.04)
Total number of CFIs in city1.00***
(1.00, 1.01)		1.00**
(1.00, 1.00)
Observations378,442378,442
Pseudo R2 0.13 0.16
*Denotes statistical significance at the 90 percent confidence level.
**Denotes statistical significance at the 95 percent confidence level.
***Denotes statistical significance at the 99 percent confidence level.