Massachusetts has launched a program to spur economic growth by depositing millions of dollars of state money in community banks with the understanding that the funds are used to make small business loans, The Associated Press reports.
State Treasurer Steven Grossman opened the Small Business Banking Partnership on Thursday by depositing $5 million into Pentucket Bank in Haverhill. Another $45 million was wired to nine other small banks, from Arlington to Ayer to Chicopee. Twenty-five additional banks have committed to participating.
The initial goal is to deposit $100 million of Treasury cash reserve funds typically held by large national and international financial institutions into Massachusetts-based banks.
Grossman says the program creates “jobs, opportunity, and prosperity.”
The first $5 million went to Pentucket Bank because bank President Scott Cole first brought the idea to Grossman.
