Bulletins

April 23, 2020

FHFA Provides Guidance on PPP Loans

On April 23, 2020, the Federal Housing Finance Agency (FHFA) issued a Supervisory Letter to the Federal Home Loan Banks providing guidance on the acceptance of Paycheck Protection Program (PPP) loans as collateral, subject to certain parameters. Specifically, this guidance requires that pledging members have a CAMELS rating of “3” or better, and also limits the amount an individual member can pledge to no more than 20 percent of its overall borrowing capacity. Additionally, no member can pledge more than $5 billion in PPP collateral.

The Supervisory Letter from the FHFA can be found here.

The FHLBNY has been actively monitoring this collateral type and believe that this regulatory clarity will assist in our assessment of its viability. We will continue to keep our members informed of any updates on this matter.

For more information, please contact your Relationship Manager at (212) 441-6700.