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ProfileCompany or group

Celtic Bank

Lender or loan platform

PPP · PPPLF
Type
Company or group
Role
Lender or loan platform
Programs
PPP, PPPLF
Updated

The profile

Individuals and companies whose conduct was challenged or called into question during or after the pandemic. See sources: House fintech report, Dec. 1, 2022 Clyburn letter, May 27, 2021 Banking Dive on SBA review, Dec. 9, 2022

  • Type: Bank, PPP lender of record. A small Utah industrial bank that originated PPP loans both directly and, at much larger volume, as the issuing lender behind fintech platforms (chiefly BlueVine, which brought in nearly three-quarters of Celtic's PPP dollars according to the House Select Subcommittee; also Square Capital and a Kabbage channel).
  • Legal entities: Celtic Bank Corporation (holding: Celtic Investment, Inc.). Utah state-chartered industrial bank (industrial loan company). FDIC cert. #57056; NMLS #500016. Member FDIC.
  • Founded: Founder Reese S. Howell, Jr. applied for the Utah ILC charter in 2000; the charter was granted and the bank began operating in 2001, consolidating a predecessor mortgage business.
  • HQ: 268 South State Street, Suite 300, Salt Lake City, UT 84111.
  • CEO: Reese S. Howell, Jr. (founder, Chairman & CEO).
  • Role in PPP: Lender of record. Celtic funded PPP loans through its own borrower-facing pipeline and as the issuing bank for third-party platforms that generated and packaged applications; BlueVine and Square Capital are the documented examples. Celtic's own May 27, 2020 release described the operation as run "in conjunction with our referral and strategic partners."

In the archive

Pandemic-role map

  • Reader shorthand: small Utah ILC that became a high-volume PPP lender of record, mostly through fintech referral partners, mostly in the 2020 round.
  • What Celtic was: the chartered, FDIC-insured lender that held the loans and submitted them to SBA. Where a fintech platform (e.g., Square) took the application, Celtic was the "lender" named on the note.
  • What the partners did: BlueVine, Square Capital and other platforms ran the borrower-facing intake, marketing, and application assembly; Celtic supplied the charter, the SBA lender relationship, and balance-sheet capacity.
  • The PPP book: 167,201 PPP loans / $4.49 billion as originating lender, about $233.1 million in estimated SBA processing fees, $3.28 billion peak PPPLF balance (SBA FOIA loan-level data and Federal Reserve PPPLF data, linked below). Unlike the Womply/Blueacorn CDFIs, Celtic did most of its PPP business in 2020: about 75% of its estimated PPP fees came in the first round (SBA FOIA loan-level data).
  • Oversight status: one of four companies, with Kabbage, BlueVine and Cross River, that the House Select Subcommittee asked for PPP fraud documents on May 27, 2021 (Clyburn letter to Celtic Bank); named among the eight PPP partner lenders SBA said it would investigate when it suspended Blueacorn and Womply in December 2022 (Banking Dive); the House Select Subcommittee's December 2022 report discusses Celtic as BlueVine's partner bank. No public charge, settlement, or adverse finding against Celtic has been identified.

Before the pandemic

Celtic is a two-decade-old industrial bank with a specific niche: SBA lending. Reese Howell applied for Utah's industrial-loan-company charter in 2000 and the bank began operating in 2001 (FDIC Federal Register publications). Celtic was an established SBA 7(a) lender while remaining small by asset size.

An ILC charter and SBA-lending experience made Celtic a counterparty for fintechs that wanted to originate SBA-guaranteed credit without being banks. Square Capital used Celtic as its issuing lender for small-business loans before the pandemic (Square page captures), and BlueVine discloses Celtic as the issuer of its line of credit (BlueVine disclosures, cited in its profile).

Celtic's year-end 2019 call report (FDIC cert. #57056) shows total assets of roughly $973 million and net income of about $42.0 million (FFIEC call reports, linked below).

During the pandemic (2020–2022)

Celtic Bank made 167,201 Paycheck Protection Program loans worth $4.49 billion (SBA PPP FOIA loan-level data), 4.6 times the $973 million the whole bank held in assets at the end of 2019 (Celtic Bank call reports, FDIC cert. 57056, 2019Q4–2022Q4).

Fees at SBA's schedule, funding from the Fed at 0.35%

SBA paid the lender a processing fee on each loan: 5% on loans of $350,000 or less, 3% on loans above $350,000 and under $2 million, and 1% on loans of $2 million and up. After the December 27, 2020 relief law, the fee on loans of $50,000 or less became the lesser of 50% of the loan or $2,500. An agent that brought in the application could be paid only out of the lender's fee ("We Are Not the Fraud Police," House Select Subcommittee on the Coronavirus Crisis, Dec. 1, 2022). Of Celtic's loans, 149,690, about 90%, were $50,000 or less. At SBA's schedule its fees come to an estimated $233.1 million, 75% of it on 2020 loans (estimate from SBA FOIA loan-level data).

Total assets went from $1.19 billion on March 31, 2020 to $4.22 billion on June 30. On June 30, $2.78 billion of Celtic's $2.93 billion PPP balance was pledged to the Federal Reserve's PPP Liquidity Facility, which lent at 0.35% (call reports; Federal Reserve PPPLF disclosures). Celtic's borrowing there peaked at $3.28 billion on April 12, 2021, about 10.9 times its equity.

Over 99,000 loans by May 27, 2020, by Celtic's count

On May 27, 2020, Celtic said it had "officially funded over 99,000" PPP loans totaling over $2.5 billion since the program's April 3 launch, with "a small staff of just over 200" (Celtic Bank press release, May 27, 2020). SBA's data show 109,891 Celtic loans, $2.91 billion, approved in April and May. By May 2, internal correspondence among Celtic executives and BlueVine staff had the bank "originating annual program volumes in mere days," the House report says. A homepage notice posted after the second round opened on April 27, and still up on May 2, told applicants that SBA's E-Tran system was "overwhelmed" (Celtic Bank homepage, May 2, 2020). E-Tran issues the authorization numbers lenders need to close and fund PPP loans.

BlueVine brought nearly three-quarters of the money

Celtic's release credited "our referral and strategic partners." Square said on June 15, 2020 that its Square Capital unit had facilitated more than $820 million in PPP loans to more than 76,000 small businesses by June 10; the post's footer reads "All loans are issued by Celtic Bank" (Square, "PPP in Review"). The larger channel by dollars was BlueVine: the House report found that "nearly three-quarters" of Celtic's PPP funds came through BlueVine applications. By mid-May 2021, the report says, Celtic's own analysis counted 1,723 confirmed fraud cases, 1,557 of them on BlueVine loans. Celtic's risk and compliance committees put BlueVine's estimated gross fraud rate at 7%, against under 5% on Celtic's direct loans.

The report credits Celtic's oversight with prompting BlueVine to add new software and manual review. In April 2021 board materials, Celtic estimated that BlueVine's rate of fraudulent loan funds had fallen from 8.54% on first-draw loans to 0.08% on second-draw loans, on then-available data. The same report says BlueVine's delays caused Celtic to file late Suspicious Activity Reports, "in violation of applicable banking regulations." No regulator action over those filings has been identified.

Celtic's president put fraud losses at "over $10 billion" in August 2020

In an August 12, 2020 email, Celtic's president and chief operating officer estimated that potential fraud losses in the PPP could already be "over $10 billion." In October 2020 the CEO wrote that the fraud was "definitely getting up there" and "not surprising given the program guidelines." In another internal email the CEO wrote that "the industry should push hard to make sure the SBA accepts the fraud risk" (House report).

Clyburn's May 27, 2021 letter

On May 27, 2021, Select Subcommittee Chairman James E. Clyburn wrote to Celtic's Reese Howell, Jr. for documents on its fraud controls and its estimates of improper payments, and asked how much revenue Celtic had earned from PPP loans (Clyburn letter to Celtic Bank, May 27, 2021). Celtic was one of four companies in that first round of requests, with Kabbage, BlueVine and Cross River Bank. The letter cited a Project on Government Oversight analysis that found Celtic involved in nearly 30% of the approved fintech-channel loans subject to DOJ prosecutions. Its examples came from charged cases. In one, Celtic issued $1,903,157 for a fintech partner to a Florida man claiming a scrap-metal company with 69 employees in his home. In the other, Celtic directly issued a $984,710 loan four days after an application containing "six incomplete, unsigned, and factually incorrect tax forms."

Customers got SBA relief and shorter lobby hours

Celtic's relief notices described government programs: SBA would again make qualifying 7(a) borrowers' monthly payments, capped at $9,000, and the help would be "automatically provided" (Celtic Bank, "Coronavirus Response & Paycheck Protection Program," April 15, 2021). Its own notices set lobby hours of 10 a.m. to 2 p.m. and asked customers to send payoff and servicing requests by email. We found no fee waiver or discount of Celtic's own in seven of its 2020–2022 web pages. In January 2021 it took second-draw applications only from "our current customers" (Celtic Bank homepage, Jan. 20, 2021); by April 15 it took them "from anyone that has previously received a PPP loan, regardless of who the initial lender was." It made 19,999 second-draw loans in 2021, worth $663.7 million.

Net income nearly doubled in 2020

Celtic's call reports show net income of $42.0 million in 2019, $80.9 million in 2020, $99.7 million in 2021 and $80.4 million in 2022. The reports give income year to date; subtracting the first quarter leaves $41.3 million for the second quarter of 2020 alone, 98% of all of 2019. Its PPP balance, $2.93 billion across 78,036 loans on June 30, 2020, was $43.6 million at the end of 2022.

Enforcement / oversight / where they are now

On December 9, 2022, after the House Select Subcommittee's report "We Are Not the Fraud Police", SBA suspended Blueacorn and Womply from working with the agency and said it would investigate eight PPP partner lenders (Banking Dive). Celtic was on that list, alongside Cross River, Customers, Capital Plus, Prestamos, Fountainhead, Harvest, and Benworth. The House report discusses Celtic in its treatment of BlueVine's partner banks.

Being named as an investigation subject is the extent of the documented oversight exposure. No DOJ charge, no False Claims Act settlement, no SBA-OIG adverse finding, and no bank-regulator enforcement order specific to Celtic's PPP conduct has been identified; the cohort's bank-regulator actions (Cross River's 2023 FDIC consent order, Customers' 2024 FRB written agreement) are against other banks. Celtic does appear in borrower prosecutions as the defrauded lender in the chain, not the charged actor: United States v. Matava (D. Conn.; Celtic disbursed a $100,000 loan on false certifications, then denied the second-draw attempt) and United States v. Epstein (D. Md.; borrower defrauded Cross River, BlueVine, Celtic, and SBA).

Celtic remains a private, active Salt Lake City industrial bank under Howell, still in the SBA 7(a) business (company site).

  • Customers Bank — another sponsor bank; ran an explicit white-label PPP platform
  • Cross River — the third large sponsor bank; FDIC consent order (non-PPP) in 2023
  • BlueVine — fintech partner; Celtic issued its credit product and, per the House record, tightened its PPP fraud controls
  • Blueacorn — LSP examined in the House Select Subcommittee's December 2022 report, which prompted the SBA investigation naming Celtic
  • Capital Plus / Crossroads — CDFI lender of record whose call-report earnings surge parallels Celtic's
  • Kabbage / KServicing — fintech lender; the House Select Subcommittee's May 27, 2021 document requests went to Kabbage, Bluevine, Cross River and Celtic
  • Reese Howell, Jr. — founder/Chairman/CEO

Sources

Company self-reported (attribute to Celtic / Square; not independently verified here)

Primary / analysis (verified)

  • SBA FOIA loan-level joins (167,201 loans / $4.49 billion / about $233.1 million fees / about 75% 2020): SBA PPP FOIA loan-level data, https://data.sba.gov/dataset/ppp-foia
  • Fed PPPLF peak balance $3.28B; leverage vs. equity: Federal Reserve PPPLF lender-level disclosures, https://www.federalreserve.gov/monetarypolicy/ppplf.htm
  • FFIEC call reports, FDIC cert. #57056, 2019Q4–2022Q4: call report data from the FFIEC Central Data Repository
  • Borrower prosecutions naming Celtic as lender: U.S. Attorney's Office, D. Conn., Mar. 29, 2024, https://www.justice.gov/usao-ct/pr/coventry-man-sentenced-2-years-prison-fraudulently-obtaining-covid-19-relief-funds; U.S. Attorney's Office, D. Md., May 8, 2025, https://www.justice.gov/usao-md/pr/baltimore-county-businessman-sentenced-prison-fraudulently-obtaining-more-13-million

External references

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