Featured Product

    FED Announces Rule Change in Relation to Paycheck Protection Program

    April 17, 2020

    FED announced a change to an interim final rule to bolster the effectiveness of the Paycheck Protection Program (PPP) of the Small Business Administration. The change will temporarily modify the FED rules to allow certain bank directors and shareholders to apply for PPP loans for their small businesses. The rule change becomes effective immediately and will be in place while the PPP is active. Comments on the interim final rule will be accepted for 45 days after publication in the Federal Register.

    To prevent favoritism, FED rules limit the types and quantity of loans that bank directors, shareholders, officers, and businesses owned by these persons can receive from their related banks. These requirements have prevented some small business owners from accessing PPP loans—especially in rural areas. The Small Business Administration recently clarified that PPP lenders can make PPP loans to businesses owned by their directors and certain shareholders, subject to certain limits and without favoritism. This change will allow banks to make PPP loans to a broad range of small businesses within their communities, in line with the rules and restrictions of the Small Business Administration. The change only applies to PPP loans.

    PPP was created under the Coronavirus Aid, Relief, and Economic Security (CARES) Act to facilitate lending to small businesses affected by COVID-19. Under PPP, qualified lenders, including many depository institutions subject to section 22(h) of the Federal Reserve Act and the Board’s Regulation O, may make loans to small businesses for payroll-related and other purposes specified in the CARES Act. Loans that meet the requirements for the PPP set forth by the Small Business Administration are guaranteed as to the unpaid principal and accrued interest of the loan. The guarantee for PPP loans provided by the Small Business Administration is backed by the full faith and credit of the United States. Only loans made between February 15, 2020 and June 30, 2020 are eligible for the PPP. 


    Related Links

    Keywords: Americas, US, Banking, Small Banking Administration, Paycheck Protection Program, COVID-19, Credit Risk, CARES Act, Regulatory Capital, FED

    Featured Experts
    Related Articles
    News

    APRA Updates Validation and Derivation Rules in September 2020

    APRA updated the lists of the Direct to APRA (D2A) validation and derivation rules for authorized deposit-taking institutions, insurers, and superannuation entities.

    September 24, 2020 WebPage Regulatory News
    News

    EC Proposes Frameworks for Crypto-Assets and Operational Resilience

    EC adopted a package that includes the digital finance and retail payments strategies and the legislative proposals for regulatory frameworks on crypto-assets and digital operational resilience.

    September 24, 2020 WebPage Regulatory News
    News

    ECB Publishes Opinion on Proposals to Amend Securitization Framework

    ECB published an opinion (CON/2020/22) on proposals for regulations amending the securitization framework of EU, in response to the COVID-19 pandemic.

    September 24, 2020 WebPage Regulatory News
    News

    FCA Consults on Regulation of International Firms in UK

    FCA is consulting on its approach to the authorization and supervision of international firms operating in UK.

    September 23, 2020 WebPage Regulatory News
    News

    MAS Amends Notice on Capital Adequacy Requirements of Banks

    MAS published amendments to Notice 637 on the risk-based capital adequacy requirements for reporting banks incorporated in Singapore.

    September 23, 2020 WebPage Regulatory News
    News

    FCA to Begin to Move Firms to New Data Collection Platform RegData

    FCA announced that it will move firms to RegData from Gabriel in the coming months in stages, based on the reporting requirements of firms.

    September 23, 2020 WebPage Regulatory News
    News

    ISDA Expects IBOR Fallbacks to be Effective by End of January 2021

    ISDA issued a letter to regulators to flag that it now expects the supplement to the 2006 ISDA Definitions and the Interbank Offered Rate (IBOR) Fallbacks Protocol to be effective around mid- to late-January 2021.

    September 23, 2020 WebPage Regulatory News
    News

    APRA Reviews Repayment Deferral Plans, Identifies Best Practices

    APRA has concluded its review of the comprehensive plans of authorized deposit-taking institutions for the assessment and management of loans with repayment deferrals.

    September 22, 2020 WebPage Regulatory News
    News

    ESAs Assess Risks to Financial Sector After COVID-19 Outbreak

    ESAs (EBA, EIOPA, and ESMA) published the first joint report that assesses risks in the financial sector since the outbreak of the COVID-19 pandemic.

    September 22, 2020 WebPage Regulatory News
    News

    BoE Confirms Withdrawal of COVID Corporate Financing Facility

    BoE and HM Treasury confirmed that the COVID Corporate Financing Facility (CCFF) will close for new purchases of commercial paper, with effect from March 23, 2021.

    September 22, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5836