Commercial Paper Funding Facility: Program Terms and Conditions1
|Effective January 23, 2009|
The Federal Reserve Bank of New York will commit to lend to the SPV on a recourse basis. The New York Fed will be secured by all the assets of the SPV.
Assets of the SPV
The SPV will only purchase U.S. dollar-denominated commercial paper (including asset-backed commercial paper (ABCP)) that is rated at least A-1/P-1/F1 by a major nationally recognized statistical rating organization (NRSRO) and, if rated by multiple major NRSROs, is rated at least A-1/P-1/F1 by two or more major NRSROs.
The SPV will not purchase ABCP from issuers that were inactive prior to the creation of the CPFF. An issuer will be deemed inactive if it did not issue ABCP to institutions other than the sponsoring institution for any consecutive period of three-months or longer between January 1 and August 31, 2008.
Limits per issuer
At the time of its registration to use the CPFF, each issuer must pay a facility fee equal to 10 basis points of the maximum amount of its commercial paper the SPV may own.
1The Federal Reserve reserves the right to review and make adjustments to these terms and conditions, including pricing and eligibility requirements.
2The unsecured credit surcharge will take the form of a 100 basis point per annum fee paid up front on each sale of commercial paper to the SPV. An issuer may avoid the unsecured credit surcharge if the issuer provides a collateral arrangement for the commercial paper that is acceptable to the New York Fed or obtains an indorsement or guarantee of its obligations on the commercial paper that is acceptable to the New York Fed.