The US Treasury and Federal Reserve approved the creation of new and expanded programs to provide up to $2.3 trillion in financing to businesses, local governments and households hit by the coronavirus pandemic, Treasury Secretary Steven Mnuchin said on Thursday
WASHINGTON (Pakistan Point News / Sputnik - 09th April, 2020) The US Treasury and Federal Reserve approved the creation of new and expanded programs to provide up to $2.3 trillion in financing to businesses, local governments and households hit by the coronavirus pandemic, Treasury Secretary Steven Mnuchin said on Thursday.
"The combination of these facilities will provide up to $2.3 trillion in new financing to support American workers by helping American businesses preserve jobs, sustain operations, and continue to serve their customers," Mnuchin said in a press release.
Using funds appropriated under the CARES Act, Treasury will make a $75 billion equity investment in a special purpose vehicle established to implement the Main Street Business Lending Program. This investment will enable up to $600 billion in new financing for businesses with up to 10,000 employees or $2.5 billion in 2019 annual revenues, the release said.
Additionally, Treasury will make a $35 billion equity investment in the Municipal Liquidity Facility (MLF), which will provide up to $500 billion in direct financing to states, counties, and cities to help ensure they have the funds necessary to provide essential services to citizens and respond to the coronavirus pandemic, the release said.
The initiative would also create an as-yet-unnamed program to leverage $350 million from the Paycheck Protection Programs to back additional loans to business, and also establish a new program to implement Primary and secondary credit facilities authorized in the $2 trillion CARES Act. The latter initiative, in combination with other programs, will provide $750 billion in additional liquidity in additional liquidity.
The release also included a number of smaller initiatives, with entire package designed to provide up to $2.3 trillion in new financing to help sustain the US economy until the pandemic passes.
The Federal Reserve said in a separate release that the funding would help households and employers of all sizes and bolster the ability of state and local governments to deliver critical services, particularly care for the ill, during the pandemic.
