CRANBERRY TWP — A seminar Monday designed to encourage more lending and economic development attracted more than 20 regional bankers and financial experts.

The seminar, called the "Road to Recovery," primarily acted as a tutorial for bankers looking to lend more money in their communities. There were several speakers who represented companies that give money to banks which in turn give loans to people to spur economic development.

The point of the seminar was to tell many bankers who are unaware that the federal government guarantees a large portion of loans under the American Reinvestment and Recovery Act.

Tom Williams, the director of Pennsylvania's department of the United States Department of Agriculture, said federal guarantees on loans are making lending easier and more appealing to institutions looking to lend money for projects in their community.

He told the crowd many amenities are available under the USDA's Business and Industry Loan Guarantee program, which guarantees large portions of loans that will be paid by the federal government if the borrower defaults.

Williams called the seminar a "talk for lending institutions to get the job market moving and retain what we already have" in terms of lending money to projects that will create or retain jobs.

Neil Cotiaux of the Federal Home Loan Bank in Pittsburgh said his bank pumps out "low cost equity" to lending agencies. He said many banks have been incredibly cautious in allocating loans because of the state of the economy, but he added many are unaware of new regulations that protect more of their money if a borrower defaults.

"The economy has been in a precarious state, and local lenders have been hit by the same economic winds," he said. "We're here to show what tools are available to help local lenders get their hands on more capital so they can lend more money efficiently."

Mike Richards, a USDA Rural Development employee, said the loan guarantees are designed to make banks less cautious to lend money. For example, he said, a federal loan guarantee of 90 percent means the bank will get $9 million back out of a $10 million loan if the borrower defaults and can't pay the loan.

He also said loans for specific projects carry with them more lenient interest rates and repayment timetables such as a 30-year period of repayment if the project involves real estate development.

Richards said he understands some banks could take advantage of the lenient guarantee rates but added the system won't be abused under a rigorous screening process.

"This program won't make a bad loan good. It will make a good loan better," he said.

Richards said he has already seen creative lending result in new movie theaters or bowling allies that create jobs in communities.

U.S. Rep. Jason Altmire, D-4th, opened the seminar by talking about the health of the economy and lenders' role in rejuvenating a slumping market.

He brought an encouraging tone to the nation's beleaguered economy, telling the crowd consumer spending is up and the stock market has jumped 4,000 points in the past six months.

What's lacking, he said, is the job market and lending, both of which go hand-in-hand. More lending, Altmire said, creates more economic development by spurting new businesses and more jobs.

Talking about bankers, he said, "You all are doing amazing work in extremely difficult times. But this is the missing component. We need to break the bottleneck that is current lending so businesses can grow and thrive and create more jobs in Pennsylvania."