Regulatory Alerts2020-04-21 | 2020-08361Regulatory Capital Rule for Paycheck Protection Program Lending Facility and Loans; Correction
The Federal Deposit Insurance Corporation (FDIC) issued a correcting amendment to align its regulatory capital rules with other federal banking agencies regarding the Paycheck Protection Program (PPP) Lending Facility and PPP loans. The amendment permits banking organizations to exclude collateral pledged to the PPP Lending Facility from leverage and risk-weighted asset calculations, effectively neutralizing associated capital impacts. It also establishes a zero percent risk weight for PPP covered loans by adding a new provision to 12 CFR part 324, which became effective on April 21, 2020.
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