UPDATE: On July 6, 2020 the Federal Reserve Bank of Boston announced that the Main Street Lending Program is now fully operational and ready to purchase participations in eligible loans that are submitted to the program by registered lenders. The Federal Reserve Bank of Boston also announced its intention to publish in the coming days a state-by-state listing of lenders accepting new business customers under the Main Street program and electing to be listed.
On July 28, 2020 the Federal Reserve Board announced an extension through December 31 of its lending facilities that were scheduled to expire on or around September 30, which includes the Main Street Lending Program.
On June 15, 2020 the Federal Reserve announced the launch of its Main Street Lending Program (Main Street Program). As previously described, this program will provide up to $600 billion in liquidity to eligible lenders that make direct loans to eligible businesses (generally speaking, U.S. companies with 15,000 or fewer employees or 2019 annual revenues of $5 billion or less). Specifically, the Main Street Program is designed to support small and mid-sized businesses that were in good financial condition before the pandemic but now need loans to help maintain operations until they have recovered from the economic downturn.
This announcement does not mean that eligible businesses may begin to apply for Main Street Program loans, however. The first step will be registering eligible lenders that desire to participate. Interested lenders that are eligible may register as of June 15, 2020. Once an eligible lender has been registered, it may begin to process loans for the Main Street Program. Also, there is no prescribed form of application for these loans nor does the Federal Reserve intend to publish a list of eligible lenders that have been registered for participation. Potential borrowers should contact their existing lenders to confirm whether they will participate and to discuss the application process.
For assistance and further information, please contact your Varnum attorney.
Additional Main Street Lending Program Advisories
Federal Reserve Further Expands Main Street Lending Program
Business Law Advisory, June 8, 2020
Main Street Lending Program: Federal Reserve Announces Revised Terms
Business Law Advisory, April 30, 2020
Main Street Lending Program: Revised Term Sheets Expected Soon
Business Law Advisory, April 29, 2020
COVID-19: Federal Reserve Announces New Loan Facility for Main Street Businesses
Business Law Advisory, April 9, 2020