Fed Expands Secondary Market Corporate Credit Facility

Today, the New York Fed announced it will be expanding the SMCCF and will purchase individual bonds along with the currently traded ETF’s. Under the new guidelines, the Fed will buy individual bonds on the secondary market that have remaining maturities of five years or less

The updated term sheet can be viewed here.

**All BDA Fed advocacy can be viewed here

The SMCCF will begin purchases of corporate bonds to create a portfolio that tracks a broad, diversified market index of U.S. corporate bonds.  This index is made up of bonds trading in the secondary markets that have been issued by companies created or organized in the United States or under the laws of the United States that satisfy the criteria detailed in the revised term sheet.

Issuers must have been rated investment grade as of March 22, 2020, and still be rated at least BB-/Ba3 on the date of purchase by the SMCCF.

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