Main Street Lending Program

BBVA USA is pleased to announce its participation in the Main Street Lending Program.

The information provided on this page is provided as a courtesy by BBVA USA.  The information provided on this page is current as of July 6, 2020  but is subject to change. BBVA USA does not make any representation or warranty regarding the accuracy and completeness of the information contained on, or linked from, this page.  Any business interested in the Main Street Lending Program (MSLP) should consult with its counsel and advisors, and conduct its own diligence regarding the terms, certifications, conditions, restrictions and covenants required by the Federal Reserve in connection with the MSLP.  The Federal Reserve may modify the restrictions and requirements of the MSLP at any time, and interested businesses should review the information available through the Federal Reserve here.

What is the Main Street Lending Program?

BBVA knows small and medium-sized businesses are key to the economy. Those jobs are the livelihood of employees and the foundation of communities. The Main Street Lending Program (MSLP) was created specifically to help those businesses and their employees better meet the challenges of COVID-19. The program is intended for businesses that were in sound financial condition before the pandemic. Its goal is to help maintain operations and payroll until conditions return to normal. 

BBVA USA is pleased to announce its participation in the Main Street Lending Program. Like any assistance loan, there are certain conditions that need to be met to qualify. You’ll want to familiarize yourself with all the details before deciding if the program is right for your business and employees. Below is information that may be helpful to you as you consider whether the MSLP makes sense for your business.

IMPORTANT: As of July 6, the Boston Fed has stated that the MSLP is fully operational. For real time program updates click here.


  • The Main Street Lending Program (MSLP) is a loan program established by the Federal Reserve.
  • Unlike the PPP, the MSLP is not a grant or forgivable loan. MSLP loans must be repaid in full. The principal amount cannot be reduced through loan forgiveness.
  • MSLP loans are subject to numerous covenants, certifications, and quarterly and annual reporting requirements that are more extensive and restrictive than some traditional commercial loan products. 
  • Under the MSLP, a special purpose entity (SPV) established by the Federal Reserve and Treasury will purchase a 95% participation interest in a loan made by an “Eligible Lender” to an “Eligible Borrower”. As such, you should understand that the federal government will have an ownership interest in the loan and a role in the decision making during the term of the loan. The operative documents provide for the Eligible Lender to sell to the SPV an undivided participation in the loan and related rights that, subject to certain further conditions including payment default and certain insolvency events affecting the Eligible Borrower, the SPV’s status may be elevated to that of a “co-lender” of 95% of the loan. In all events, the SPV has rights with regard to the administration of the MSLP loan, including determinations as to whether certain amendments are permitted.
  • The SPV will only purchase a participation if a potential borrower was in sound financial condition before the onset of the COVID-19 pandemic, but now needs credit to maintain operations and payroll until conditions normalize.

Eligibility

Do all banks participate in MSLP?
  • No.  Only lenders who have registered with the Federal Reserve and have been approved as an “Eligible Lender” may participate as a lender in the MSLP. 
  • BBVA USA is a registered Eligible Lender.
Is every business an Eligible Borrower under the MSLP?
  • No.  Only businesses that qualify as “Eligible Borrowers” under the MSLP are eligible to participate.  
  • Not all Eligible Borrowers will qualify for MSLP loans.  
  • Eligible Borrowers must also undergo full credit reviews and have their loans affirmatively approved by the applicable Eligible Lender.
  • Currently, the Federal Reserve is NOT making MSLP loans available to non-profits but may do so in the future.
How do I know if my business qualifies as an “Eligible Borrower” to participate in MSLP?
  • Any business interested in participating in the MSLP should consult with its counsel and thoroughly review the MSLP eligibility requirements before applying for an MSLP loan with an Eligible Lender.  
  • Any business interested in participating in the MSLP will be required to attest to its eligibility.
If my business is eligible to participate in MSLP, will it automatically receive a loan?

No. Businesses who are eligible to participate in the MSLP must apply for a loan and must go through the Eligible Lender’s credit underwriting process and Eligible Lenders may establish other conditions deemed to be necessary for safe and sound banking operations.

Borrower's Responsibility

What are an Eligible Borrower’s responsibilities under the MSLP?

The MSLP is a program funded, in part, by tax dollars.  Accordingly, Eligible Borrowers under the MSLP are subject to covenants and certifications that are more extensive and restrictive than some traditional commercial loan products.  In addition to the customary standard covenants, representations and warranties required for commercial loan transactions, the following are among the conditions, covenants or certifications required of a business under the MSLP:

  • must have been established prior to March 13, 2020.
  • must have been formed under the laws of the United States, one of the several states, the District of Columbia, any territories or possessions of the United States or an Indian Tribal government. 
  • must not be an “Ineligible Business” listed  in 13 CFR 120.110(b)-(j), (m)-(s), as modified or clarified by the SBA from time to time.
  • must have either (a) up to 15,000 employees, subject to affiliation rules, or (b) up to $5.0 billion in 2019 revenues. 
  • must have significant operations and a majority of employees based in the U.S.
  • must certify that it will not participate in more than one MSLP facility.
  • must certify that it will not participate in the Primary Market Corporate Credit Facility.
  • must certify it will comply with the requirements of the CARES Act for the term of the loan plus 1 year, including the compensation, stock repurchase and capital distributions restrictions that apply under the MSLP.
  • must certify that it is unable to secure adequate credit accommodations from other banking institutions.
  • must certify that it is not insolvent and has the ability to meet financial obligations for at least 90 days after closing.
  • must make specific certifications regarding the loan, including the financial records provided to the Eligible Lender, collateral value and other relevant information.
  • must covenant not to repay the principal balance of other debt until the Eligible Loan is paid in full (other than payments that are mandatory and due)
  • must covenant not to cancel or reduce any of its committed lines of credit with the Eligible Lender or any other lender until the MSLP loan is paid in full or neither the SPV or any governmental assignee hold an interest in the MSLP loan in any capacity
  • must covenant to use loan proceeds only for the benefit of borrower
  • must adhere to the quarterly and annual reporting requirements required by the MSLP

The borrower certifications and covenants will be submitted to the Federal Reserve in connection with the loan participation.  Funding of any MSLP loan by BBVA USA will be conditioned upon the receipt of a binding commitment letter from the Federal Reserve, so if an Eligible Borrower receives approval for an MSLP loan funding of the loan may be delayed.

If my business is an Eligible Borrower and receives an MSLP, can my business pay compensation, make distributions, and stock repurchases?
  • Eligible Borrowers are restricted from making distributions and stock repurchases and paying certain compensation during the term of an MSLP loan and the following 12 month period.  
  • Businesses interested in participating in the MSLP should consult with their counsel and advisors to understand the restrictions and terms of the CARES Act before applying for an MSLP loan.  

MSLP Terms

What are the terms of MSLP loans?

The terms of MSLP loans vary by facility.  Certain terms and conditions are required for all loans by the MSLP.  The following chart summarizes certain of the required terms by facility type.

Main Street New Loan Facility (MSNLF) Main Street Priority Loan Facility (MSPLF) Main Street Expanded Loan Facility (MSELF)

Loan Type

new term loan

new term loan

upsized tranche of existing term loan or revolving loan

Loan Size

$2 million* to $35 million

$2 million* to $50 million

$10 million to $300 million

Maximum Combined Debt to Adjusted 2019 EBITDA

4 times

6 times

6 times

Maturity Date

 5 years

same

same

BBVA Hold / SPV Participation

5% (BBVA)
95% (SPV)

same

same

Interest Rate

30-day or 90-day LIBOR plus 300 bps

same

same

Interest Payment

Deferred 1 year and capitalized

same

same

Principal Payments

Year 1: 0%
Year 2: 0%
Year 3: 15%
Year 4: 15%
Year 5: 70%

same

same

Loan Seniority

Cannot be contractually subordinate in payment priority to any other loans

Senior to or pari-passu with other debt, except mortgage debt

Upsized tranche is senior to or pari-passu with other debt, except mortgage debt

Prepayment

Permitted Without Penalty

same

same

Cross Acceleration

Required

same

same

Financial Reporting

Quarterly and Annual Requirements

Quarterly and Annual Requirements

Quarterly and Annual Requirements

* The Fed and Treasury established a program framework with minimum loan amounts for the program of $250,000 and BBVA has established a higher minimum loan amount.

Is the Federal Reserve providing more detailed information regarding required terms?

The term sheets provided by the Federal Reserve include detailed information regarding required terms and may be found here.

Besides the MSLP requirements from the Federal Reserve, are MSLP loans subject to other terms and conditions?

In addition to the MSLP requirements from the Federal Reserve, an MSLP loan will be subject to other terms and conditions as may be set forth in the loan documentation and as required by the Eligible Lender. All BBVA USA loan documentation for the MSLP will include, as a condition precedent to funding, its receipt of a commitment letter from the Federal Reserve to purchase the 95% participation.

Obtaining an MSLP loan may require certain traditional banking arrangements with BBVA USA. MSLP loans will be subject to (a) all approvals and protocols including credit underwriting, Bank Secrecy Act and Know Your Customer protocols, and (b) other limitations including, but not limited to, geographic limitations.

Fees and other Financial Considerations

What are the fees associated with MSLP?
  • Eligible Lenders may charge Eligible Borrowers a one-time origination fee, and may also require the Eligible Borrowers to pay a one-time transaction fee to the Eligible Lender, which is then paid to the SPV. 
  • The Eligible Borrower will also be responsible to the Eligible Lender for certain fees for customary and necessary services like appraisal fees and attorneys’ fees.
Are MSLP loans forgivable?
  • No.  The MSLP is not a grant program, nor is it an extension of the Paycheck Protection Program (PPP). 
  • MSLP loans must be repaid in full.

Other MSLP Information

Will a potential borrower’s location be taken into consideration by BBVA USA?
  • Yes.  BBVA USA will focus on potential borrowers in its current markets when evaluating MSLP loan inquiries.
  • BBVA USA will focus on its existing markets for several reasons but the primary reason relates to the need to continue to follow existing Bank Secrecy Act (BSA) and Know Your Customer (KYC) protocols.  BSA/KYC is more important now than ever when entering a business relationship as cases of fraud are known to rise during recessions.  In addition, as coronavirus continues to spread, operational limitations exist which limit our bankers’ ability to meet in person with prospective customers.
  • BBVA USA's MSLP markets include the states of Alabama, Arizona, Colorado, Florida, New Mexico, and Texas.
Are we required to use the Federal Reserve's loan documents?
  • No. The Federal Reserve did not provide form loan documents. Instead, the Federal Reserve provided certification, covenant, co-lender agreement, assignment and participation agreement forms. The Federal Reserve confirmed that Eligible Lenders may use their own loan documentation, and BBVA USA will use attorney-prepared form loan documents
  • As is customary with commercial lending, borrowers will be responsible for paying attorneys’ fees.

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Main Street Lending Program

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Details you need to make a smart decision

Submitting the information above does not constitute an application for credit. The information collected here is merely to allow the BBVA USA to connect a business inquiring about credit to a banker with the necessary expertise for the business's size and particular line of business. BBVA USA will not respond to inquiries from loan brokers or other third parties purporting to act on behalf of a potential borrower. BBVA USA requires submission of a completed loan application, signed or authenticated by someone authorized by the business to apply for credit on behalf of the business.

All accounts and credit are subject to approval, specifically including credit approval.

Loans and other products are subject to definitive agreements and nothing herein or in any such definitive agreement will be deemed to create any legal partnership, joint venture or fiduciary or other special relationship between BBVA USA and any other person.