Market Overview

Pace of Small Business Investment Remains Strong

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Positive Investment is Driving Economic Growth

Small business investment continued to register gains at the end of 2017
as delinquencies and defaults remained at low levels according to the
latest small business credit trends from PayNet,
the leading provider of small business credit data and analysis.
However, some warning signs in financial health are starting to emerge.

The December 2017 Thomson Reuters/PayNet Small Business Lending Index
(SBLI) decreased 1% to 136.5 from 138.5 (revised) in November 2017.
Compared to December 2016, the SBLI increased 2%.

Results show solid investment support from several sectors. Construction
increased +7%, Transportation +13%, and Administrative and Waste
Services +5% on a three-month rolling basis compared to three months ago.

Weaknesses are primarily in the services sector with declines in
Information Services (-8%), Professional Services (-3%), and Health Care
(-2%) on a three-month rolling basis compared to three months ago.

"The certainty from cut taxes played a role in driving more investment,"
states William Phelan, president of PayNet, Inc.

The Thomson Reuters/PayNet Small Business Delinquency Index (SBDI) 31-90
days past due increased 2 basis points (bps) from 1.36% in November 2017
to 1.38% in December 2017; this is the highest it has been since
November 2012. Compared to one year ago, delinquency increased 6 bps.

Default rates remained essentially flat year-over-year and
month-over-month with the PayNet Small Business Default Index (SBDFI) at
1.83% for December 2017. Information Services defaults rose swiftly by
+17 bps since last month. Conversely, default rates continue to fall
rapidly in the Mining, Oil, and Gas sector and Transportation sector,
-25 bps and -20 bps since last month, as both sectors continue to
benefit from turnarounds in economic conditions in their respective
industries.

"Over the last couple of months, certain industries and regions of the
country are faring better than others," Phelan noted. "Small businesses
are showing positive momentum."

About

PayNet Inc. is the leading provider of credit ratings on small
businesses enabling lenders to manage credit risk, grow earning assets
and operate credit at lower cost. PayNet maintains the largest
proprietary database of small business loans, leases and lines of credit
encompassing over 23 million contracts worth over $1.5 Trillion. Using
state-of-the-art analytics, PayNet converts raw data into real-time
marketing intelligence and predictive information that subscribing
lenders use to make informed small business financial decisions and
improve their business strategy. For more information visit www.paynet.com.

Thomson Reuters/PayNet Small Business Lending
Index (SBLI)

The Small Business Lending Index (SBLI) is based on new commercial loan
and lease originations by major U.S. lenders in PayNet's proprietary
database. This index measures the volume of loans to small businesses
normalized to January 2005. Small businesses generally respond to
changes in economic conditions more rapidly than do larger businesses,
so this statistic is a leading indicator of the economy and predicts
changes in GDP between 2-5 months.

Thomson Reuters/PayNet Small Business
Delinquency Index (SBDI)

The Small Business Delinquency Index (SBDI) measures the financial
stress of small businesses with $1mm or less in credit outstanding.

PayNet Small Business Default Index (SBDFI)

The PayNet Small Business Default Index (SBDFI) measures small business
defaults and signal insolvency across multiple sectors of the economy at
the national, state and industry levels. Default is a point-in-time
measurement of borrowers that have failed to remain current and as such
is a vital piece of information to assess risk exposure and evaluate the
health of the overall economy.

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