On June 8, 2020, the Federal Reserve Board (Federal Reserve or FRB) announced a number of changes to the terms and conditions for three Main Street Lending Program (MSLP) facilities: the Main Street New Loan Facility (MSNLF), the Main Street Priority Loan Facility (MSPLF), and the Main Street Expanded Loan Facility (MSELF). The Federal Reserve anticipates lender registration to be open in the coming days.
In response to feedback received from industry groups and others, the Federal Reserve made the following changes to the MSLP, which will make the program available to more small and medium-sized businesses:
- Reducing the minimum loan size for the MSNLF and MSPLF from $500,000 to $250,000
- Increasing the maximum loan size for all facilities
- Increasing the term of each loan option from four to five years
- Deferring the initial principal payments for two years, rather than one
- Reducing the lenders’ risk retention in the MSPLF from 15% to 5%; as a result, the MSLP special purpose vehicle will purchase a 95% participation in qualifying loans under all three facilities