Business loan programs: Securitization of Section 7(a) loans; initial benchmark number, establishment,
FR, April 02, 1999 › Notices › Small Business Administration
Linked as:Text
Federal Register: April 2, 1999 (Volume 64, Number 63)NoticesPage 16021From the Federal Register Online via GPO Access [wais.access.gpo.gov]
DOCID:fr02ap99-88
SMALL BUSINESS ADMINISTRATION
Business Loan Programs; Notice of Initial Benchmark Number
AGENCY: Small Business Administration.
ACTION: Notice.
SUMMARY: SBA regulations governing the securitization of Section 7(a) loans require that from time to time the SBA publish in the Federal Register the ``Benchmark Number'' to be used in overseeing securitizing lenders. The Benchmark Number is the number of percentage points that a securitizing lender's Currency Rate may decline before SBA takes action. The purpose of this Notice is to establish an initial Benchmark Number of 2.5 percentage points.
SUPPLEMENTARY INFORMATION: In February of 1999, SBA published its final rule governing the securitization of the unguaranteed portions of 7(a) loans in the Federal Register. Section 120.420 of the rule requires the SBA to publish the ``Benchmark Number'' for securitizations in the Federal Register from time to time. The Benchmark Number will be used in the oversight of securitizing lenders. The Benchmark Number is the number of percentage points that a securitizing lender's Currency Rate may decline before SBA takes action.
The 2.5 percentage point Benchmark was proposed in comments to the May 1998 proposed securitization rule (63 FR 27221). SBA considers a 2.5 percentage point decline in Currency Rate a significant event warranting action. SBA will monitor the Benchmark Number and, if economic conditions or policy considerations warrant, SBA may modify it to protect the safety and soundness of the 7(a) program. SBA will publish any modifications to the Benchmark Number in the Federal Register at least 30 days before the effective date.
DATES: Effective April 2, 1999.
FOR FURTHER INFORMATION CONTACT: James W. Hammersley, Director, Secondary Market Sales, 202-205-7505, U.S. Small Business Administration, 409 Third Street, S.W., Suite 8200, Washington, D.C. 20416. Aida Alvarez, Administrator.
FR Doc. 99-8147Filed4-1-99; 8:45 amBILLING CODE 8025-01-P
Sponsored links
