Treasury, Fed setting up new lending facility for large businesses

Treasury, Fed setting up new lending facility for large businesses
© Getty Images

The Treasury Department and Federal Reserve are working on a new lending facility for large businesses that are not investment grade as a way to help them weather the coronavirus downturn, Treasury Secretary Steven MnuchinSteven MnuchinConservatives are outraged that Sarah Bloom Raskin actually believes in capitalism Suspect in Khashoggi murder arrested The Hill's Morning Report - Presented by Facebook - Biden to tackle omicron risks with new travel rules MORE said Wednesday.

Speaking on CNBC, Mnuchin said that the new "main street lending facility" would be available for companies with more than 500 workers that don't have the same credit status as other large firms.

Small businesses, with fewer than 500 employees, can already apply to a fund with $349 billion in loans that was established as part of the $2.2 trillion coronavirus relief package President TrumpDonald TrumpDeputy AG: DOJ investigating fake Trump electors Former Boston Red Sox star David Ortiz elected to Baseball Hall of Fame Overnight Health Care — Senators unveil pandemic prep overhaul MORE signed into law on March 27.

The new fund for larger businesses would be housed at the Federal Reserve and capitalized by major investors. The Treasury Department would then be able to offer loans at reasonable rates.

"It's a very real effort," Mnuchin said, adding that he was involved in daily calls on the subject. "We hope to have an announcement this week with the details on that and get it up and running as soon as we can."