After much anticipation, the Board of Governors of the
Federal Reserve (Federal Reserve) on April 9, 2020 announced
additional actions “using its full range of authorities” to
provide US$2.3 trillion of credit to a wide variety of business
enterprises, states and municipalities. The Federal Reserve’s
actions in support of existing and new programs, as described
below, leverage up to US$500 billion of investment by
Treasury and leave substantial “dry powder” for the Federal
Reserve to modify or provide additional financial support if
and as needed after these programs take root. The guidance
provided to date is both incomplete and subject to revision,
with the Federal Reserve seeking public comment to its
guidance on or before April 16.
In this alert, we provide an overview of each of the new programs and their respective term sheets, including as they relate to eligible assets and issuers, limits per issuer, and pricing, among other issues.
