Featured Product

    FED to Expand Access to PPPL Facility for Additional Qualified Lenders

    April 23, 2020

    FED announced that it is working to expand access to its Paycheck Protection Program Liquidity (PPPL) Facility for additional Small Business Administration-qualified lenders as soon as possible. This is being done to facilitate lending to small businesses via the Paycheck Protection Program (PPP) of the Small Business Administration. In addition, FED has announced temporary actions aimed at increasing the availability of intraday credit extended by Federal Reserve Banks on both a collateralized and uncollateralized basis. These temporary actions will be effective on their date of publication in the Federal Register and will expire on September 30, 2020. Finally, FED announced that it will report substantial amounts of information on a monthly basis for the liquidity and lending facilities using Coronavirus Aid, Relief, and Economic Security (CARES) Act funding.

    Access to PPPL Facility

    Small Business Administration-qualified PPP lenders include depository institutions, such as banks and credit unions, as well as non-depository institution lenders, such as some Community Development Financial Institutions. Currently, only depository institutions are eligible to participate in the PPPL Facility and over 1000 such institutions have already been approved to access the program. The PPPL Facility supports the PPP by extending credit to financial institutions that make PPP loans, using the loans as collateral. The additional liquidity from the PPPL Facility increases the capacity of financial institutions to make additional PPP loans. 

    Temporary Actions Aimed at Increasing Availability of Intraday Credit

    In light of disruptions from the COVID-19 outbreak, depository institutions may face unanticipated intraday liquidity constraints and demands on collateral pledged to the Federal Reserve Banks. In response, FED is adjusting the manner in which the Federal Reserve Banks administer part II of the Policy on Payment System Risk (PSR policy). Specifically, FED is:

    • Suspending uncollateralized intraday credit limits (net debit caps) and is waiving overdraft fees for institutions that are eligible for the primary credit program
    • Permitting a streamlined procedure for secondary credit institutions to request collateralized intraday credit (max caps)

    FED is suspending two collections of information that are used to calculate net debit caps. FED believes that these actions will not increase credit risk to the Federal Reserve Banks. These temporary actions are intended to support the provision of liquidity to households and businesses and to mitigate the disruptions from COVID-19 outbreak. A list of the frequently asked questions regarding this will be released shortly.

     

    Related Links

    Keywords: Americas, US, Banking, COVID-19, Paycheck Protection Program, Liquidity Facility, Intraday Credit, CARES Act, Federal Reserve Banks, FED

    Featured Experts
    Related Articles
    News

    FSB Report Finds Steady Increase in Climate-Related Disclosures

    FSB published the annual report that examines to-date progress toward implementation of climate-related disclosure recommendations of the industry-led Task Force on Climate-related Financial Disclosures (TCFD).

    October 29, 2020 WebPage Regulatory News
    News

    APRA Consults on Reporting Standard for Credit Risk Management

    APRA is consulting on the reporting standard for credit risk management (ARS 220.0).

    October 28, 2020 WebPage Regulatory News
    News

    PRA Consults on Proposals to Support Transposition of BRRD2

    PRA launched a consultation (CP18/20) setting out proposals for the "Contractual Recognition of Bail-in" and "Stay in Resolution" Rules.

    October 28, 2020 WebPage Regulatory News
    News

    FASB Consults on XBRL US DQC Rules Taxonomy and Technical Guides

    FASB is consulting on the XBRL US Data Quality Committee (DQC) Rules Taxonomy (DQCRT) along with two technical guides.

    October 27, 2020 WebPage Regulatory News
    News

    EC Proposes to Amend Liquidity Coverage Rules for Covered Bond Issuers

    EC published draft of a delegated regulation amending liquidity coverage rules for covered bond issuers.

    October 27, 2020 WebPage Regulatory News
    News

    ESMA Confirms Endorsement of UK Credit Ratings Post Brexit Transition

    ESMA published an update to its March 2019 statement on the endorsement of credit ratings from UK.

    October 27, 2020 WebPage Regulatory News
    News

    PRA Updates Q&A on Branch Return Form

    PRA published Version 2 of the questions and answers (Q&A) on the Branch Return form.

    October 26, 2020 WebPage Regulatory News
    News

    Regulators Fine Goldman Sachs for Risk Management Failures

    FCA and PRA in the UK, FED in the US, and the authorities in Singapore have fined Goldman Sachs for risk management failures in connection with the 1Malaysia Development Berhad (1MDB).

    October 23, 2020 WebPage Regulatory News
    News

    ISDA Launches IBOR Fallbacks Supplement and Protocol

    ISDA launched the IBOR Fallbacks Supplement and the IBOR Fallbacks Protocol, with both becoming effective on January 25, 2021.

    October 23, 2020 WebPage Regulatory News
    News

    Canada Hosts International Conference of Banking Supervisors

    BCBS announced that OSFI and the Bank of Canada hosted the 21st International Conference of Banking Supervisors (ICBS) virtually on October 19-22, 2020.

    October 22, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 6022