James Kaplan mentioned in “Fed’s Expanded Lending Plan Leaves Private Credit in the Cold”Bloomberg News 04/30/20
On Thursday the Federal Reserve announced that they will expanded their Main Street Lending Program to help private credit firms become lenders for small and mid-sized companies. However, this support will not be eligible for direct lenders and business development companies because they do not fall under the Fed's regulatory purview.
Below is an excerpt:
“It has to be disappointing to that industry, but not entirely surprising,” said James Kaplan, partner at law firm Quarles & Brady LLP. “They’re not regulated by the Fed, they’re not familiar to the Fed and the Fed seems confident it can do this through the traditional financial institution lenders.”
“We’re looking at more of a U-shaped recovery, so companies have started to look at borrowing more, realizing it could be an extended rough spot of a very challenging six months or more,” Kaplan said.