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June 16, 2020
2020-1570

Federal Reserve seeks comment on proposed nonprofit loan facility; secondary market credit program will buy corporate debt

The Federal Reserve on June 20 made a series of announcements related to its section 13(3) emergency lending facilities established by Title IV of the CARES Act. It said it is seeking public comment on a proposal to expand its Main Street Lending Program (MSLP) to provide access to credit for nonprofit organizations. The central bank also announced that it is modifying its Secondary Market Corporate Credit Facility (SMCCF) to allow the facility to begin buying a portfolio of corporate bonds "to support market liquidity and the availability of credit for large employers." Finally, the Federal Reserve Bank of Boston said it has opened the MLSP for lender registration, posted registration documents on its web site and encouraged registered lenders participating in the MSLP to begin making loans "immediately."

The attached Alert has details. PDFs of two proposed term sheets for the nonprofit facility proposal are also attached with this alert, along with a revised term sheet for the SMCCF and a revised Frequently Asked Questions (FAQ) document for the SMCCF and the Primary Market Corporate Credit Facility.

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Contact Information
For additional information concerning this Alert, please contact:
 
Washington Council Ernst & Young
   • Will Heyniger or Bob Schellhas at (202) 293-7474 or wcey@ey.com

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ATTACHMENTS

Fed announcement

Nonprofit Organization Expanded Loan Facility

Nonprofit Organization New Loan Facility

PMCCF and SMCCF FAQs

Secondary Market Corporate Credit Facility

 

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