(Bloomberg) -- The Federal Reserve and the Treasury Department will soon start buying debt issued by banks that lend through a $349 billion government program designed to help small businesses impacted by the coronavirus, according to people familiar with the matter.
The Small Business Administration on Friday processed more than 28,000 loans through 1,200 local lenders worth $5.4 billion. Now, the lenders originating those loans will see the government purchase that debt so that they can maintain enough liquidity to continue making loans under the Paycheck Protection Program to help companies hit by the coronavirus pandemic.
A Treasury Department spokesman didn’t immediately reply to a request for comment.The plan was first reported by the Wall Street Journal.
