Fed extends seven emergency facilities to end of 2020

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WASHINGTON — The Federal Reserve will extend the life of seven emergency lending facilities launched to respond to the coronavirus crisis through the end of 2020, the central bank said Tuesday.

The three-month extension, to Dec. 31, will apply to the Primary Dealer Credit Facility, Money Market Mutual Fund Liquidity Facility, Primary Market Corporate Credit Facility, Secondary Market Corporate Credit Facility, Term Asset-Backed Securities Loan Facility, Paycheck Protection Program Liquidity Facility and Main Street Lending Program.

The Commercial Paper Funding Facility is set to expire in March 2021. The Municipal Liquidity Facility was already set to expire Dec. 31.

“The three-month extension will facilitate planning by potential facility participants and provide certainty that the facilities will continue to be available to help the economy recover from the COVID-19 pandemic,” the Fed said in a press release.

Prolonging the life of the facilities is one of several continuing steps in recent weeks by policymakers to stabilize the economy as the pandemic stretches through the summer and likely through the end of the year. This includes efforts to allow small businesses to seek forgiveness on loans made through the Paycheck Protection Program. The Fed has also modified its Main Street Lending Program to draw interest from bank providers and borrowers, including to allow wider access to nonprofit organizations such as hospitals and schools.

Last week, the Fed announced it would broaden the criteria for eligible firms for three facilities: the Term Asset-Backed Securities Loan Facility, Commercial Paper Funding Facility and Secondary Market Corporate Credit Facility.

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Federal Reserve Main Street Lending Program Central banks CARES Act Coronavirus Paycheck Protection Program Main Street Lending Program
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