M&T Bank Corp. made the most government-backed small-business loans in Western New York during October, but Five Star Bank lent more money under the program.

A month into the federal government’s 2013 fiscal year, Buffalo-based M&T posted 19 loans under the U.S. Small Business Administration’s primary loan guarantee program, accounting for 36 percent of all loans in the district that includes both Buffalo and Rochester.

Five Star Bank, the main subsidiary of Warsaw-based Financial Institutions, came in second, with 13 loans; followed by Evans Bancorp’s Evans Bank, with five; First Niagara Financial Group’s First Niagara Bank, with four; and KeyCorp’s KeyBank and Lyons National Bank, with three each.

But Five Star lent more dollars, with $3.61 million to M&T’s $2.41 million. JPMorgan Chase & Co. was third in dollars, with a single loan for $1 million; followed by First Niagara, with $541,000; and KeyBank, with $500,000.

In all, 11 banks made 53 loans for $9.39 million under the SBA’s 7(a) program, which provides government guarantees of up to 85 percent of the loan amount.

Additionally, M&T made three loans for $2.04 million under the agency’s “504” program for purchases of real estate or other fixed assets. Bank of Castile also made a loan under that program, for $349,371, while Bank of America Corp. made a loan for $163,750.

By type of borrower, M&T made three loans for $860,000 in all to exporters, while Five Star lent $2.5 million to a single exporter. And M&T provided two loans totaling $141,000 to businesses owned by military veterans, while Five Star made one for $500,000 and the New York Business Development Corp. made one for $255,000.

Small-business lending activity has been somewhat lackluster nationwide since the financial crisis and subsequent recession began, with the exception of a period of about a year when federal economic-stimulus incentives – such as fee waivers and better terms – triggered a spike in lending through the SBA. That surge returned to low levels as soon as the incentives expired, as lenders remained reticent about extending credit, while small-business owners refrained from borrowing and putting themselves in debt because of economic uncertainty.

Conditions have improved, and banks say they are increasing small-business lending, as well as the availability of new products and services for small businesses in areas such as retirement plans, online banking and insurance sales.

In fact, 13 major U.S. banks, including M&T, collectively have increased their small-business lending so far this calendar year by more than $11 billion already – more than half of the industry’s three-year commitment with the SBA, according to the Financial Services Roundtable, a trade group. M&T alone nearly quadrupled its commitment for this year, with $196 million in additional lending since last year.

But banks still aren’t doing as good a job in serving their business customers as well as they do consumers, according to J.D. Power & Associates. The California-based market research firm found that satisfaction with banks among small businesses is much lower than for retail banking customers, despite the higher value that business customers offer to banks. M&T was ranked highest among local lenders in the study of 25 large banks nationwide, followed by Key, Citizens Financial Group and Bank of America, but M&T was also the only one ranked above the average.

Confidence among small-business owners is still languishing, according to surveys. Earlier this month, the National Federation of Independent Businesses said its survey found no new job creation among small companies in October.

“October, not unlike the last several months, proved to be another weak job creation month,” said NFIB Chief Economist William C. Dunkelberg. “Pessimistic uncertainty within the small-business community continues to dampen hiring plans.”

And a quarterly survey by Barlow Research Associates, a consulting firm specializing in the small-business market, found that optimism among small- and middle-market businesses has declined to the lowest point since late 2010, after an uptick earlier in the year. Pessimism is stronger among smaller companies, with $100,000 to $10 million in sales, particularly in the Northeast. And job and capital spending expectations are also weaker.