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PH FedACTion: Financial Regulatory Updates

Daily Financial Regulation Update - Tuesday, May 19, 2020

May 19, 2020

By FedACTion Task Force

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Major Developments

SBA Issues Interim Final Rule on Treatment of Entities with Foreign Affiliates

May 18, 2020

The Small Business Administration (SBA) issued an Interim Final Rule that supplements previously posted Interim Final Rules by providing guidance on additional eligibility requirements related to entities with foreign affiliates. The Interim Final Rule clarifies that employees of foreign affiliates are counted for purposes of determining whether a Paycheck Protection Program (PPP) borrower has more than 500 employees, except in limited circumstances where the affiliation rules expressly do not apply to the entity. Under the Interim Final Rule, the SBA will not find any borrower that applied for a PPP loan prior to May 5, 2020 to be ineligible based on the borrower’s exclusion of non-U.S. employees from its calculation of its employee headcount, if the borrower (together with its affiliates) had no more than 500 employees whose principal place of residence is in the U.S., based upon an exercise of the SBA’s enforcement discretion given that a reasonable borrower could have been confused based upon prior SBA guidance that was later resolved through a clarifying FAQ (FAQ 44) on May 5, 2020.


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

to view the full text of the Paycheck Protection Program Increase Act of 2020, Enacted April 24, 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 Banking, Housing, and Urban Affairs

Senate Banking, Housing, and Urban Affairs Committee to Hold Quarterly CARES Act Hearing

May 18, 2020

The Committee on Banking, Housing, and Urban Affairs will meet remotely to conduct a hearing entitled “The Quarterly CARES Act Report to Congress” on May 19, 2020, at 10:00 a.m., Eastern. The witnesses will be: Steven T. Mnuchin, Secretary of the U.S. Department of the Treasury, and Jerome H. Powell, Chairman of the Board of Governors of the Federal Reserve System.

Federal Agencies

Federal Reserve Bank of New York

New York Fed Releases Application Materials for the Municipal Liquidity Facility

May 18, 2020

The Federal Reserve Bank of New York released a sample application and form documents and certifications with detailed information for potential issuers who wish to sell eligible notes to the Municipal Liquidity Facility.

Department of Housing and Urban Development/Federal Housing Administration

HUD Allocates more than $75 Million in Fourth Wave of CARES Act Funding to Assist People Living with Disabilities

May 18, 2020

U.S. Department of Housing and Urban Development (HUD) Secretary Ben Carson announced nearly $77 million in a fourth wave of CARES Act funding, supporting up to 8,300 additional vouchers. This wave of relief funds is provided through HUD's Section 811 Mainstream Housing Choice Voucher Program and will provide affordable housing to non-elderly people living with disabilities. The program helps to further the goals of the Americans with Disabilities Act by helping persons with disabilities live in community-based settings.

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