As you are aware, FHLBank Topeka and the Federal Reserve Bank of Kansas City entered into an agreement that allows members to freely pledge Paycheck Protection Program (PPP) loans to the Federal Reserve Bank of Kansas City on April 16. We believe much of the immediate needs for our members to fund newly created PPP loans has been satisfied with the easier access to the various funding facilities at the Federal Reserve Bank of Kansas City.
However, we believe borrowing from FHLBank continues to provide a strong value proposition and we know members would like to be able to pledge PPP loans to FHLBank to support those borrowings. As your cooperative, we advocated with both the Small Business Administration and our regulator, the Federal Housing Finance Agency (FHFA), to address your needs so that FHLBank could accept PPP loans as eligible collateral. Earlier today, the FHFA announced that FHLBanks may accept PPP loans as collateral. Based on this authorization, FHLBank will begin accepting PPP loans as collateral and is working quickly to evaluate the best approach for tracking the pledging of such loans while limiting the reporting burden for members. We will update you on the PPP pledging process as soon as possible.
In the meantime, we continue to encourage members to update their next Qualifying Collateral Determination (QCD) form to expand their FHLBank capacity to address their liquidity needs.
Extension of the QCD Filing Deadline
Given the circumstances of the COVID-19 pandemic and the additional strain on resources many of you are experiencing, FHLBank Topeka is extending the deadline to submit your March 31, 2020, QCD form by 30 days.
For those members that may need additional time to prepare and submit the QCD form, the new March QCD form deadline is June 14, 2020. We hope this additional time allows you to focus on serving your communities and assisting your borrowers with their financial needs.
If you have questions regarding the change to the QCD filing deadline, please reach out to the following team members:
Kylie Mergen, Director of Financial Services | 785.478.8203
Elaine Shumaker, Manager of Financial Services | 785.478.8204
Financial Services | 877.933.7803
