The global coronavirus pandemic hit small businesses especially hard despite the federal government programs tailored to pumping new capital into credit markets. But according to The Wall Street Journal, the pandemic masked a gradual contraction in small business lending that predates the COVID outbreak by more than a decade.

In 2007, WSJ reports-- citing an analysis of bank regulatory filings by Florida Atlantic University professor Rebel A. Cole--banks held $721 billion in small loans to businesses and small commercial mortgages of $1 million or less. By 2019, such loan balances had fallen around 6% to $680 billion. Bigger business loans and commercial mortgages, meanwhile, more than doubled to $2.82 trillion.

Analysts blame the pullback on the closure of many community banks and lower profits made on small business loans.

Read more here.