Awareness of programs in the face of the coronavirus crisis by the Federal Reserve to help consumers, businesses and state and local governments is the focus of a bulletin issued Monday by the federal regulator of national banks.
The bulletin from the Office of the Comptroller of the Currency (OCC) – OCC Bulletin 2020-41 – draws attention to five separate programs developed by the Fed to help different groups cope with the crisis: The Paycheck Protection Program Liquidity Facility (PPPLF), the Main Street Lending Program, the expanded Term Asset-Backed Securities Loan Facility (TALF), the Municipal Liquidity Facility (MLF), and the Primary and Secondary Market Corporate Credit Facilities.
The bulletin notes that the:
- PPPLF extends credit to eligible financial institutions that originate PPP loans, taking the loans as collateral at face value.
- Main Street Lending Program allows eligible banks to originate new Main Street loans or use Main Street loans to increase the size of existing loans to businesses, retaining a 5% share and selling the remaining 95% to the Main Street facility.
- Expanded TALF continues to support the issuance of asset-backed securities that fund a wide range of lending, including student loans, auto loans, and credit card loans.
- MLF purchases short-term notes directly from the states and certain counties and cities to better manage cash flow pressures.
- Primary and Secondary Market Corporate Credit Facilities increase the flow of credit to households and businesses through capital markets through expanded size and scope.
OCC Bulletin 2020-41: Federal Reserve Lending Programs: COVID-19-Related Programs to Support Households, Employers, and Communities