The Board and FRB Boston Generally Followed Their Process for Purchasing MSLP Loan Participations but Can Formally Document Some Key Processes

The Board authorized the Main Street Lending Program during the COVID-19 pandemic to support lending to businesses and nonprofits. Through the MSLP, lenders issued about $17.5 billion in loans. To encourage the flow of credit, the MSLP, which is administered by the Federal Reserve Bank of Boston, purchased loan participations (a share of loan values) from lenders. We evaluated the Board and the Federal Reserve Bank of Boston's process for purchasing MSLP loan participations.

All the loans we reviewed had complete and properly executed documentation, with reviews of lender-submitted documents generally performed as required. However, some key processes were not formally documented, which can lead to loss of institutional knowledge or inconsistency in process.

This report contains a recommendation.