14 May FDIC Issues Proposed Rule Related to Paycheck Protection Program
On May 12, 2020, the Federal Deposit Insurance Corporation (FDIC) approved a proposed rule designed to help alleviate the deposit insurance assessment effects of participating in certain programs established by the U.S. Small Business Administration and the Board of Governors of the Federal Reserve System. The rule guarantees banks will not be subject to substantially higher deposit insurance assessments for their participation in the Paycheck Protection Program, Paycheck Protection Program Lending Facility, and the Money Market Mutual Fund Liquidity Facility.
The FDIC proposed this rule to be effective by June 30, 2020, and to have an application date of April 1, 2020. These proposed dates ensure that changes are applied to assessments beginning in the second quarter of 2020 and provide a guarantee to the IDIs regarding the assessment effects of the programs.
Comments on the proposed rule will be accepted for seven days after publication in the Federal Register. For additional information, click here.