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I too got hosed by Bank of America, but I had already sent out 2 of the balance transfer checks that they have been sending me on a regular basis. The 2 checks I sent out utilized $2,200 of my remaining $7,500 limit, and I mailed the checks on April 21st. On April 24th, B of A cut my card limit to $450 above my outstanding balance, and I did not receive that letter until May 1st. I also have online access, so I saw the $39 charge for a returned check fee, and saw my lowered available credit line. Same happened the next day..so we as taxpayers give them billions so they can screw us. Thanks Ken Lewis.

I'm a small business banker. Every day I sit in my office and I deal with small business owners... think revenue under $10 million and often revenue under $1 Million... and I see their faces as they come into the bank, letter in hand, wondering why their credit lines were frozen.

These business owners typically employ 5-30 people. Chase Bank recently sent out approximately 35,000 letters in two days advising their customers that their working capital lines have been frozen. These were for lines under $100,000. If we average it out and say 35,000 lines at $50,000 each, that would mean that Chase Bank froze about $1.75 Billion dollars in credit lines that are used to keep employed .... let's call it 175,000 people, at a minimum. And Chase is not alone in this systematic reduction of credit to the small business community.

In this case, though, Chase is attempting to convert interest-only working capital lines into five year, self amortizing term loans because t...(Read more of this comment)he borrower's revenue and income has deteriorated and the bank has a need to grab some of that money while the getting is good. Please understand that many of these clients have not even missed a payment. But these credit lines are not lines that can be sold off through securitization. They are lines that the banks hold on their books and shedding these credit lines will result in bolstering the banks capital.

These lines had minimum principal payment requirements of 1% of the outstanding balance. So a $50,000 loan had to pay $500 principal payment. When the bank converts it to a five year term loan, that payment increases to $833 a month. Additionally, when they term it out, they raise the interest rate. They had granted these credit lines at ridiculously low rates to suck them into taking them in the first place: typically floating rates of Prime + 1 or 2%. Now they are increasing the rates to ranges of 7.5% to 10%, which of course increases the business owner's required monthly payment even more.

Let me make this clear to President Obama. Not only are the banks NOT making business loans to Small Business owners (I don't want to hear about their multimillion dollar loans to big business), they are systematically withdrawing credit from the small business market.

In addition to these lines of credit, many of these small business owners financed their business's needs through credit card lines. As you have so eloquently pointed out regarding consumer credit card lines, these business owners, too, are buckling under the strain of increased rates and frozen lines of credit.

When our President is rallying our Congressional leaders in support of his positions on credit card reform, he may want to share these observations from the front lines of the banking world and perhaps they too will begin to understand and start to work on behalf of the small business community, a group that will play a vital role in steering our country out of this economic crisis.

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