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State groups join ICBA in raising Paycheck Protection Program concerns Apr 03, 2020 ICBA and state community banking associations continued expressing concerns with this week's Treasury Department guidelines for the Small Business Administration's Paycheck Protection Program. In a joint letter to Treasury and SBA reiterating an ICBA letter from earlier this week, the state associations said the guidelines don't work for all community banks. The associations said: The 0.5 percent interest rate is below break-even for community banks. Congress allowed up to 4 percent. The two-year loan terms are unreasonably short and will hamper borrowers. Congress allowed up to 10-year terms. Guidelines on the use of loan proceeds are excessively restrictive. The lack of detailed guidance shifts too much liability to the lender. Treasury and the Federal Reserve should create a liquidity facility for community banks doing PPP loans. Initial information and resources on the $350 billion program established by the Coronavirus Aid, Relief, and Economic Security Act are available on the Treasury website and ICBA's Crisis Response and Preparedness Toolkit.
ICBA and state community banking associations continued expressing concerns with this week's Treasury Department guidelines for the Small Business Administration's Paycheck Protection Program. In a joint letter to Treasury and SBA reiterating an ICBA letter from earlier this week, the state associations said the guidelines don't work for all community banks.
The associations said:
Initial information and resources on the $350 billion program established by the Coronavirus Aid, Relief, and Economic Security Act are available on the Treasury website and ICBA's Crisis Response and Preparedness Toolkit.