Obama to ease small bank access to capital

WASHINGTON (Reuters) - The White House on Wednesday announced steps to improve credit availability for small businesses, in part by offering taxpayer capital to small banks at a lower cost than it has previously.

Under the plan, the Treasury Department would provide funds from the government's $700 billion financial rescue fund to small, community banks. They would have to pay the government just a 3 percent dividend, not the 5 percent other banks have been charged, the White House said.

In addition, it said it would seek legislation to raise the maximum amount of a number of different Small Business Administration loans.

(Reporting by Tim Ahmann and Glenn Somerville, Editing by Chizu Nomiyama)