Mnuchin Says Treasury Sent Money for Fed’s Corporate Loans

(Bloomberg) -- Treasury Secretary Steven Mnuchin said he sent the Federal Reserve money from a $454 billion coronavirus rescue package to begin lending to U.S. corporations.

Mnuchin’s team has worked with the central bank since the end of March to launch four out of nine lending programs backstopped by Treasury Department funds that were allocated as part of Congress’s $2.2 trillion virus-relief package.

The New York Fed announced on May 4 that it expected to begin purchasing shares of eligible exchange-traded funds via the so-called Secondary Market Corporate Credit Facility in “early May.”

“I can tell you I’m authorizing a wire this morning going into the secondary corporate facility. It’s on it’s way out,” Mnuchin said in a CNBC interview on Monday.

The facility, which has not yet launched, was backstopped with $25 billion from Treasury to leverage into $250 billion in loans.

In the interview, Mnuchin said the rest of the Fed’s loan programs created in response to legislation will launch in “several weeks.”

©2020 Bloomberg L.P.