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Daily Financial Regulation Update - Monday, April 20, 2020

April 20, 2020

By FedACTion Task Force

Congress

to view the full text of the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), 116 HR. 748, Enacted March 27, 2020.

from the Senate Committee on Banking, Housing, and Urban Affairs, Senate Committee on Small Business and Entrepreneurship, House Committee on Financial Services, and House Committee on Small Business.

U.S. Senate

Committee on Small Business and Entrepreneurship

COVID-19: Chairman Rubio Sends Letter to SBA and Treasury on Implementation of the Paycheck Protection Program

April 17, 2020

U.S. Senator Marco Rubio (R-FL), Chairman of the Senate Committee on Small Business and Entrepreneurship, sent a letter to Jovita Carranza, Administrator of the U.S. Small Business Administration, and Steven Mnuchin, Secretary of the U.S. Department of the Treasury, detailing a number of procedures and guidance that should be clarified within the Paycheck Protection Program while the agencies cannot approve more forgivable loans to small businesses due to the lapse in appropriations.

Federal Agencies

Department of Treasury

COVID-19: Treasury Updates Paycheck Protection Program FAQs

April 17, 2020

The U.S. Department of the Treasury has updated its Frequently Asked Questions (FAQs) on the Paycheck Protection Program (PPP) to confirm that a PPP loan may be sold into the secondary market at any time after the loan is fully approved. (FAQ 30). A secondary market sale of a PPP loan does not require SBA approval. A PPP loan sold into the secondary market is 100% SBA guaranteed. A PPP loan may be sold on the secondary market at a premium or a discount to par value.

Federal Reserve Board

COVID-19: Federal Reserve Updates its COVID-19 Supervisory and Regulatory FAQs

April 17, 2020

The Board of Governors of the Federal Reserve System has updated its Frequently Asked Questions (FAQs) on its various supervisory and regulatory actions in response to COVID-19. The updates include guidance on:

  1. the appropriate capital treatment of SBA Paycheck Protection Program loans;

  2. the

    on the supplementary leverage ratio issued on April 1, 2020;

  3. the

    on the community bank leverage ratio issued on April 6, 2020;

  4. the appropriate practice for handling payment deferrals;

  5. the delayed adoption of the current expected credit loss (CECL) methodology under the CARES Act and the CECL transitions interim final rule; and

  6. the kinds of mortgage loans eligible for CARES Act forbearance and related guidance for mortgage servicers working with struggling homeowners affected by COVID-19.