Federal Reserve Lending Programs: Nearly Half of Main Street Program Loans Are Fully Repaid, but Losses Have Increased (GAO, December 2024)

Summary

GAO report GAO-25-107246 to congressional committees, December 2024, headed Federal Reserve Lending Programs: Nearly Half of Main Street Program Loans Are Fully Repaid, but Losses Have Increased. It says that of the 1,830 loans made through the program, 850 (or almost half) had been fully repaid as of August 31, 2024. Another 138 loans (or about 8 percent) had recorded a total of about $969 million in losses, a significant increase (about $781 million) year-over-year, and about 46 percent (or 847 loans) remained outstanding. The program had collected about $1.89 billion in interest payments, and a balloon payment of the remaining 70 percent of principal will come due beginning mid-2025.

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FEDERAL RESERVE 
LENDING 
PROGRAMS 
Nearly Half of Main 
Street Program Loans 
Are Fully Repaid, but 
Losses Have 
Increased
Report to Congressional Committees
December 2024
GAO-25-107246
United States Government Accountability Office
United States Government Accountability Office
Highlights of GAO-25-107246, a report to 
congressional committees
December 2024
FEDERAL RESERVE LENDING PROGRAMS 
Nearly Half of Main Street Program Loans Are Fully 
Repaid, but Losses Have Increased
What GAO Found
In response to the COVID-19 pandemic, the Board of Governors of the Federal 
Reserve System authorized 13 emergency lending programs—known as 
facilities—to ensure the flow of credit across the economy. To improve oversight
of these programs, the Federal Reserve issued seven reports from December 
2020 through June 2024 that evaluated its internal processes and controls, such 
as for risk management and cybersecurity. These reports identified 20 
opportunities to enhance internal controls. GAO found that Federal Reserve 
Banks, which manage the facilities, have fully addressed 19 of the 20 
opportunities. The remaining opportunity, which relates to a facility’s evaluation 
model that monitors loans’ credit quality, is currently under review. GAO also 
found that the Federal Reserve’s plans for ongoing monitoring of the facilities are 
generally aligned with federal internal control standards.
The five facilities under the Main Street Lending Program targeted small and 
midsize businesses and nonprofits. Of the 1,830 loans made through this 
program, 850 (or almost half) had been fully repaid as of August 31, 2024, the 
most recent data available. Further, 138 loans (or about 8 percent) had recorded 
a total of about $969 million in losses, a significant increase (about $781 million)
year-over-year. About 46 percent (or 847 loans) remained outstanding. The 
program had collected about $1.89 billion in interest payments.
Main Street Lending Program Loans, First Quarter 2021–Third Quarter 2024
Note: Numbers may not add to the total number of loans due to varying loan statuses.
Loans to larger businesses have generally performed better than those to smaller 
ones. For example, businesses with annual revenues over $42.1 million at loan 
origination accounted for the largest share of repaid loans. In contrast, smaller 
businesses (annual revenues of $3.1 million or less) experienced higher rates of 
delinquencies and losses. Businesses in the construction sector have repaid a 
smaller proportion of loans and experienced higher delinquency rates compared 
with other sectors, such as the leisure and hospitality sector.
The higher rates of delinquencies and losses partly reflect the effects of higher 
interest payments and the 15 percent of each loan’s principal that came due for 
borrowers in the second half of 2023. Interest rates higher than those at loan 
origination have increased borrowers’ payments, potentially creating financial 
strain for businesses. Another 15 percent of each loan’s principal came due
during 2024, and a balloon payment of the remaining 70 percent will come due 
beginning mid-2025, potentially further affecting loan performance.
View GAO-25-107246. For more information, 
contact Michael E. Clements at (202) 512-
8678 or ClementsM@gao.gov.
Why GAO Did This Study
As of the end of fiscal year 2024, four 
of the Federal Reserve’s 13 lending 
facilities, all part of the Main Street 
Lending Program, continued to hold 
significant outstanding assets and 
loans. These facilities had 
approximately $4.7billion in 
outstanding assets and loans, which 
will not mature until July 2025 or later.
About $10.4 billion in collateral was 
pledged to secure the loans. The four 
facilities were among the nine that 
received funds appropriated through 
the CARES Act (section 4003). The 
Federal Reserve is required to monitor 
and report on the status of the facilities 
until they no longer hold outstanding 
assets or loans. 
The CARES Act includes a provision 
for GAO to annually report on section 
4003 loans, loan guarantees, and 
investments. This report examines (1) 
the Federal Reserve’s oversight and 
monitoring of the CARES Act facilities 
and (2) the status and performance of 
Main Street Lending Program loans. 
GAO reviewed Federal Reserve 
documentation, conducted loan-level 
analysis of Main Street Lending 
Program loan performance covering 
July 2020 through August 2024, and 
interviewed Federal Reserve officials. 
Page i GAO-25-107246 Federal Reserve Facilities 
Letter 1
Background 3
Federal Reserve Oversight Continues, and Reserve Banks Have 
Generally Implemented Previously Identified Enhancements 8
Nearly Half of Main Street Loans Have Been Fully Repaid, but 
Losses Have Increased 11
Agency Comments 27
Appendix I Objectives, Scope, and Methodology 30
Appendix II GAO Contact and Staff Acknowledgments 33
Tables
Table 1: Federal Reserve Facilities Established with CARES Act 
Funding 5
Table 2: Number and Dollar Amount of Outstanding Main Street 
Loans by Sector, as of August 2024 16
Table 3: Number and Dollar Amount of Fully Repaid Main Street 
Loans by Sector, as of August 2024 20
Table 4: Number and Dollar Amount of Main Street Loan Losses 
by Census Region, as of August 2024 23
Figures
Figure 1: Outstanding Assets of Federal Reserve Lending 
Facilities Supported by CARES Act Funding, June 2020–
September 2024 6
Figure 2: Number of Outstanding Main Street Lending Program 
Loans, First Quarter 2021–Third Quarter 2024 12
Figure 3: Percent of Outstanding Main Street Loans by Business 
Size, as of August 2024 13
Figure 4: Outstanding Main Street Loans by Census Division, as 
of August 2024 14
Figure 5: Number of Fully Repaid Main Street Loans, First Quarter 
2021–Third Quarter 2024 17
Figure6: Percent of Fully Repaid Main Street Loans by Business 
Size, as of August 2024 18
Contents
Page ii GAO-25-107246 Federal Reserve Facilities
Figure 7: Fully Repaid Main Street Loans by Census Division, as 
of August 2024 19
Figure 8: Number and Dollar Amount of Main Street Loan Losses, 
Second Quarter 2021–Third Quarter 2024 21
Figure 9: Percent of Main Street Loans with Losses by Loan Size, 
as of August 2024 22
Figure 10: Percent of Main Street Loans with Losses by Business 
Size, as of August 2024 23
Figure 11: Number of Active Main Street Delinquencies,Fourth 
Quarter 2021–Third Quarter 2024 25
Figure 12: Main Street Charge-Off and Delinquency Rates, First 
Quarter 2021–Third Quarter 2024 26
Page iii GAO-25-107246 Federal Reserve Facilities 
Abbreviations
NAICS North American Industry Classification System
RBOPS Division of Reserve Bank Operations and Payment 
Systems
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Page 1 GAO-25-107246 Federal Reserve Facilities
441 G St. N.W.
Washington, DC 20548
December 19, 2024
Congressional Committees
In response to the economic effects of the COVID-19 pandemic, in 2020, 
the Board of Governors of the Federal Reserve System authorized 13 
emergency lending programs, known as facilities. These facilities were 
intended to support the flow of credit to employers, consumers, small and 
midsize businesses, state and local governments, and nonprofit 
organizations.1 Nine of the 13 facilities received funds appropriated by the 
CARES Act.2
The CARES Act facilities ceased purchasing assets or extending credit by 
January 8, 2021. Only the facilities under the Main Street Lending 
Program, which targeted small and midsize businesses and nonprofits, 
continue to hold substantial outstanding assets and loans.3 As of 
September 30, 2024, the program held about $4.7 billion in outstanding 
assets and loans.4 Main Street loans have a 5-year maturity, meaning 
any currently outstanding loans will not mature until July 2025 or later.
Section 4026(f) of the CARES Act includes a provision for us to report 
annually on the loans, loan guarantees, and other investments provided 
1The facilities are authorized under section 13(3) of the Federal Reserve Act and 
approved by the Secretary of the Treasury. Section 13(3) of the Federal Reserve Act 
permits the Federal Reserve to provide emergency lending.
2To provide economic relief, section 4003(b)(4) of the CARES Act made available at least 
$454 billion for the Department of the Treasury to support the Board of Governors of the 
Federal Reserve System in establishing facilities. Pub. L. No. 116-136, § 4003(b)(4), 134 
Stat. 281, 470 (2020). We refer to these facilities as CARES Act facilities.
3The Federal Reserve also established four emergency lending facilities thatdid not 
receive CARES Act appropriations, which we refer to as non–CARES Act facilities, 
intended to serve various markets and credit needs. On July 30, 2021, the last of the non–
CARES Act facilities stopped purchasing assets or extending credit. 
4This amount includes Main Street loan participations at face value, net of an allowance 
for credit losses updated as of September 30, 2024. As of September 30, 2024, about 
$10.4 billion was held in collateral to secure the loans.
Letter
Page 2 GAO-25-107246 Federal Reserve Facilities
under section 4003 of the CARES Act.5 This report examines (1) the 
Federal Reserve’s oversight and monitoring of the CARES Act facilities 
and (2) the status of Main Street loans and characteristics and trends in 
loan performance.
To address the first objective, we analyzed documentation from the 
Federal Reserve’s Division of Reserve Bank Operations and Payment 
Systems (RBOPS). This included its procedures for CARES Act facilities, 
planning documents, and summaries of its completed reviews. We also 
compared RBOPS’s monitoring plans against selected federal internal 
control standards.6 Additionally, we reviewed the Federal Reserve’s 
periodic reports and financial statements for updates on potential and 
actual losses incurred by the facilities, and we received written responses 
from Federal Reserve officials.
For the second objective, we conducted loan-level analysis of Main Street 
Lending Program data as of the end of August 2024, the most recent data 
available from the Federal Reserve Bank of Boston. To assess the 
reliability of these data, we reviewed documentation, including the data 
dictionary, for Main Street loan data and performed electronic testing on-site for outliers, missing data, and erroneous values. We also gathered 
information from Federal Reserve Bank of Boston officials about the 
collection methodology. We determined the data were sufficiently reliable 
for the purpose of describing the status and characteristics of Main Street 
loans and their performance. A more detailed description of our 
objectives, scope, and methodology can be found in appendix I.
5Specifically, we are to report no later than 9 months after the date of enactment of the 
act, and annually thereafter through the year succeeding the last year for which loans, 
loan guarantees, or other investments made under section 4003 are outstanding. Our 
previous reports were GAO, Federal Reserve Lending Programs: Status of Monitoring and 
Main Street Lending Program, GAO-24-106482 (Washington, D.C.: Dec. 22, 2023); 
Federal Reserve Lending Programs: Risks Remain Low in Related Credit Markets, and 
Main Street Loans Have Generally Performed Well, GAO-23-105629 (Washington, D.C.: 
Dec. 19, 2022); Federal Reserve Lending Programs: Credit Markets Served by the 
Programs Have Stabilized, but Vulnerabilities Remain, GAO-22-104640 (Washington, 
D.C.: Oct. 19, 2021); and Federal Reserve Lending Programs: Use of CARES Act-Supported Programs Has Been Limited and Flow of Credit Has Generally Improved, 
GAO-21-180 (Washington, D.C.: Dec. 10, 2020). Additionally, we regularly issue 
government-widereports on the federal response to COVID-19, available at 
https://www.gao.gov/coronavirus.
6GAO, Standards for Internal Control in the Federal Government, GAO-14-704G 
(Washington, D.C.: September 2014). 
Page 3 GAO-25-107246 Federal Reserve Facilities 
We conducted this performance audit from December 2023 to December 
2024 in accordance with generally accepted government auditing 
standards. Those standards require that we plan and perform the audit to 
obtain sufficient, appropriate evidence to provide a reasonable basis for 
our findings and conclusions based on our audit objectives. We believe 
that the evidence obtained provides a reasonable basis for our findings 
and conclusions based on our audit objectives.
The Federal Reserve Act established the Federal Reserve System as the 
country’s central bank.7 The system consists of three parts: the Federal 
Reserve Board, Reserve Banks, and the Federal Open Market 
Committee.8 The Federal Reserve Board is a federal agency located in 
Washington, D.C., that oversees the operations of the Reserve Banks 
and shares with them the responsibility for supervising and regulating 
certain financial institutions and activities. The Federal Reserve System is 
divided into 12 districts, and each district is served by a regional Reserve 
Bank.
The Federal Reserve Board has the authority to authorize the Reserve 
Banks to extend credit more broadly than usual during emergencies.9
Specifically, under section 13(3) of the Federal Reserve Act, during 
unusual and exigent circumstances, the Federal Reserve can authorize 
Reserve Banks to extend credit to a broader range of borrowers.10
7Federal Reserve Act, Pub. L. No. 63-43, 38 Stat. 251 (1913).
8The Federal Open Market Committee consists of the seven members of the Board of 
Governors, the President of the Federal Reserve Bank of New York, and four other 
Reserve Bank presidents who serve on a rotating basis. The committee is responsible for 
directing open market operations to influence the total amount of money and credit 
available in the economy. 
9Reserve Banks typically lend to banks through discount window programs based on 
established statutory criteria. 12 U.S.C. § 347b(a). The discount window is a Federal 
Reserve Board lending program that allows eligible institutions to borrow money, usually 
on a short-term basis, at an above-market rate to meet temporary liquidity shortages.
1012 U.S.C. § 343(3). During the 2007–2009 financial crisis, the Federal Reserve invoked 
its section 13(3) authority to create emergency programs to stabilize financial markets and 
avert the failures of a few individual institutions. 
Background
The Federal Reserve 
System and Emergency 
Lending Authority
Page 4 GAO-25-107246 Federal Reserve Facilities
In response to the economic disruptions caused by the COVID-19 
pandemic, the CARES Act authorized at least $454 billion for the 
Department of the Treasury to support the Federal Reserve in 
establishing facilities to provide liquidity to the financial system. With the 
Secretary of the Treasury’s approval, the Federal Reserve used its 
authority under section 13(3) to authorize nine facilities using funds 
appropriated by the CARES Act.11 The Federal Reserve cited a number 
of factors in determining that unusual and exigent circumstances existed. 
These factors included disruption in the financial markets, reduced 
availability of credit, a heightened need for credit, and an increase in 
business expenditures.
In general, the CARES Act facilities were designed to address broad 
sectors of the economy, such as large corporations, small and midsize 
businesses, and state and local governments. Overall, the CARES Act 
facilities could support up to $1.95 trillion in transaction volume, and 
Treasury disbursed $102.5 billion in CARES Act funds to the support the 
facilities. Of this total, as of September 30, 2024, the Federal Reserve 
had returned about $97.5 billion to Treasury, leaving about $5 billion 
available to cover any potential losses the facilities incur. In accordance 
with the Consolidated Appropriations Act, 2021, all nine facilities stopped 
purchasing assets or extending credit by January 2021. They conducted 
a total of about $41 billion in transactions (see table 1).12
11The Federal Reserve established 13 emergency lending facilities in response to the 
COVID-19 pandemic. Four emergency lending facilities—the Commercial Paper Funding 
Facility, Money Market Mutual Fund Liquidity Facility, Paycheck Protection Program 
Liquidity Facility, and Primary Dealer Credit Facility—were non–CARES Act facilities, 
which all stopped purchasing assets or extending credit by July 30, 2021. In March 2023, 
the Federal Reserve established another emergency lending facility to boost operating 
banks’ liquidity and minimize contagion after Silicon Valley Bank and Signature Bank 
failed. The Bank Term Funding Program was established on March 12, 2023, and ceased 
extending loans on March 11, 2024.
12For the Main Street Lending Program, the transaction amount refers to the Federal 
Reserve’s participation in the Main Street loans, which is the purchase of 95 percent of 
lenders’ authorized loan amount to eligible borrowers. 
Emergency Lending 
Facilities in Response to 
COVID-19
Page 5 GAO-25-107246 Federal Reserve Facilities 
Table 1: Federal Reserve Facilities Established with CARES Act Funding
CARES Act–supported facilities Number 
of 
facilities
Facility activity Termination date Transaction 
amount (in 
billions)
Primary Market Corporate Credit 
Facility and Secondary Market 
Corporate Credit Facility
2 Support large businesses by purchasing 
qualifying corporate bonds and other eligible 
assets
Dec. 31, 2020 $14.3a
Main Street Lending Program 5b Support small and midsize for-profit businesses 
and nonprofit organizations by purchasing 
participations in eligible loans
Jan. 8, 2021 $16.5c
Municipal Liquidity Facility 1 Support states, certain counties, municipalities, 
multistate entities, and revenue bond issuers 
by purchasing eligible notes that these entities 
issued 
Dec. 31, 2020 $6.4
Term Asset-Backed Securities 
Loan Facility
1 Support consumers and businesses by 
providing nonrecourse loans to U.S. companies 
secured by qualifying asset-backed securities 
generally backed by recently originated 
consumer and business loans
Dec. 31, 2020 $3.7
Source: GAO analysis of documents and data from the Board of Governors of the Federal Reserve System. | GAO-25-107246
aThe Primary Market Corporate Credit Facility did not conduct any transactions.
bThe Main Street Lending Program comprised five facilities: the Main Street New Loan Facility, Main 
Street Priority Loan Facility, Main Street Expanded Loan Facility, Nonprofit Organization New Loan 
Facility, and Nonprofit Organization Expanded Loan Facility.
cThe transaction amount refers to the Federal Reserve’s participation in Main Street Lending 
Program loans, which is the purchase of 95 percent of lenders’ authorized loan amount to eligible 
borrowers. The Nonprofit Organization Expanded Loan Facility did not conduct any transactions.
For the facilities that received CARES Act funds, outstanding assets 
peaked between November 2020 and January 2021 (see fig. 1). As of 
September 2024, only four of the Main Street Lending Program facilities 
continued to hold assets.13
13The Main Street Lending Program’s Nonprofit Organization Expanded Loan Facility did 
not conduct any transactions.
Page 6 GAO-25-107246 Federal Reserve Facilities 
Figure 1: Outstanding Assets of Federal Reserve Lending Facilities Supported by CARES Act Funding, June 2020–September 
2024
Note: Since Feb. 24, 2021, the Main Street Lending Program’s outstanding assets have been reported net of an allowance for credit losses, which is 
updated quarterly. The Main Street lending facilities purchased a participation interest in newly issued eligible loans that eligible lenders made to eligible 
small and midsize for-profit borrowers and nonprofit organizations. 
The Federal Reserve’s Division of Reserve Bank Operations and 
Payment Systems (RBOPS), which oversees the policies and operations 
of the Reserve Banks, is primarily responsible for the oversight of the 
facilities. RBOPS’s general framework for oversight consists of three 
phases:
• Phase one. During its initial phase of oversight, RBOPS, through 
communication with Reserve Bank staff, focused on providing 
assistance in setting up the various facilities quickly.
• Phase two. As the facilities became operational, RBOPS reviewed 
the facilities’ established governance structures, process workflows, 
and internal control design. RBOPS conducted these reviews to assist 
Reserve Banks in identifying any enhancements at an early point in 
the life of the facilities and to obtain reasonable assurance that the 
design of controls and processes was adequate to ensure the 
Federal Reserve 
Oversight of the Facilities
Page 7 GAO-25-107246 Federal Reserve Facilities
facilities’ effective operation. RBOPS completed phase two reviews 
for all facilities by December 2020.
• Phase three. The third phase consists of ongoing monitoring 
activities. These include continued communication with Reserve Bank 
management and periodic reviews of facility operations and controls 
to obtain reasonable assurance that controls are present and are 
functioning in a manner that addresses identified risks. According to 
RBOPS documentation, phase three oversight activities will continue 
throughout the life of the facilities, until they no longer hold 
outstanding assets or loans.
As part of phase three, RBOPS prepares interim reports at 6-month 
intervals, unless a change in timing is approved by the credit facilities’
oversight steering group and advisers.14 These reports summarize the 
scope of oversight activities and any enhancement opportunities related 
to facility processes and controls. As of October 2024, RBOPS had 
issued seven interim reports to Reserve Bank management 
communicating the results of phase three reviews, cumulatively covering 
December 2020 to June 2024.
As we previously reported, RBOPS has a process for determining 
whether enhancement opportunities have been addressed.15 RBOPS 
officials said Reserve Bank staff notify RBOPS when they have 
completed steps to address an enhancement opportunity. RBOPS then 
analyzes the actions taken and determines whether the enhancement 
opportunity has been addressed. According to RBOPS officials, this 
analysis may include discussions with a Reserve Bank’s internal audit 
team and management, walk-throughs with Reserve Bank staff to 
understand new or updated processes, and reviews of documentation, 
such as process flows and procedures.
As of February 2024, all of the CARES Act facilities, except those under 
the Main Street Lending Program, had wound down all processes and 
terminated operations.
14RBOPS’s organizational structure for phase three credit facility oversight consists of a 
steering group and an adviser group that oversee the teams responsible for phase three 
focus areas.
15GAO-24-106482.
Page 8 GAO-25-107246 Federal Reserve Facilities 
RBOPS’s two most recent interim reports identified no additional 
opportunities to enhance facilities’ processes and controls. These reports, 
which were issued to the applicable Reserve Banks, covered 6-month 
periods from July 2023 to June 2024.
Consistent with our previous reporting, we found that RBOPS’s ongoing 
monitoring of the facilities generally aligns with federal internal control 
standards for monitoring of an entity’s internal control system.16 According 
to the standards, management should establish and operate monitoring 
activities to monitor the internal control system and evaluate the results. 
This includes ongoing monitoring of the design and operating 
effectiveness of the internal control system as part of the normal course 
of operations. Further, management should remediate identified internal 
control deficiencies on a timely basis.
From July 2023 to June 2024, RBOPS continued to monitor facilities with 
outstanding loans and to review progress toward implementing a 
previously identified enhancement opportunity, discussed further below. 
RBOPS communicated the results of its ongoing monitoring to facility 
management teams at relevant Reserve Banks and the Federal Reserve 
Board. As part of its phase three reviews, RBOPS conducts ongoing 
follow-up and periodic reporting on facilities’ progress in incorporating the 
remaining enhancement.
RBOPS last updated its overall monitoring approach in fiscal year 2023 
and made no changes for fiscal year 2024. In early 2023, RBOPS 
reassessed operation and risk factors to calibrate its oversight activities 
for the year. RBOPS identified three overall focus areas for 2023: (1) 
16See GAO-14-704G and GAO-24-106482. 
Federal Reserve 
Oversight Continues, 
and Reserve Banks 
Have Generally 
Implemented 
Previously Identified 
Enhancements
Federal Reserve Identified 
No Additional 
Opportunities to Enhance 
Processes and Controls
Page 9 GAO-25-107246 Federal Reserve Facilities
collateral and asset management; (2) operations and controls; and (3) 
cybersecurity, resiliency, and data management. The operations and 
controls area was further divided into four subfocus areas: risk 
management; vendor management; internal controls; and resources, 
roles, and responsibilities.
RBOPS noted the following for each focus area:
• Collateral and asset management. RBOPS will continue to monitor 
underlying collateral, such as by reviewing activities to understand 
and evaluate whether the Reserve Banks’ approach ensures that the 
emergency loans remain adequately collateralized and whether asset 
management procedures are consistent with sound risk management 
practices.
• Operations and controls. RBOPS will use the components of the 
operations and controls function to obtain reasonable assurance that 
controls are present and are functioning in a manner that addresses 
evolving risks.
• Cybersecurity, resiliency, and data management. To strengthen 
risk management practices, reduce cyber risks, and maintain 
resiliency for the facilities, RBOPS will continue to oversee ongoing 
operations and improvements to the cybersecurity programs through 
various oversight activities. These oversight activities include regular 
reviews, continuous monitoring, and other efforts to reduce risk and 
improve the efficiency and effectiveness of information technology 
operations.
According to RBOPS’s 2023 planning documentation, phase three 
oversight will continue to take an adaptive approach, given the maturity of 
the underlying assets and ongoing investments. Board staff are to consult 
and coordinate ongoing oversight activities with Reserve Bank control 
functions, such as risk management and internal audit, and with external 
auditors. Additionally, RBOPS is to perform a risk assessment each year 
to inform its planned oversight activities. Based on its ongoing 
assessments, RBOPS determined that no changes were needed to its 
monitoring approach for 2024.
Page 10 GAO-25-107246 Federal Reserve Facilities
As we previously reported, Reserve Banks have implemented processes 
to address all 20 opportunities for enhancing processes and controls 
identified by RBOPS.17 Of the 20 enhancement opportunities, RBOPS 
has completed its review of 19. The remaining opportunity, which relates 
to the validation of one facility’s credit evaluation model, is currently under 
review.18
During 2023, RBOPS balanced its ongoing oversight of the CARES Act 
facilities with other activities, including the Federal Reserve’s response to 
2023 banking stress and the announcement and implementation of the 
Bank Term Funding Program. According to RBOPS, review of the 
remaining opportunity resumed in December 2023.
As of September 30, 2024, the Main Street Lending Program facilities 
were the only ones that had experienced losses. As of that date, the Main 
Street facilities had recognized approximately $1.2 billion in actual credit 
losses, net of subsequent recoveries, which we discuss in more detail 
later in the report. This accounts for about 7 percent of the total 
transaction amount the program conducted.
The Federal Reserve analyzes all of the outstanding CARES Act facilities 
on a quarterly basis to determine if it is necessary to set aside an 
allowance for potential losses. The evaluation of loan participations 
purchased by the Main Street Lending Program, including those in 
nonaccrual status, resulted in recording a credit loss allowance for the 
Main Street Lending Program of $923 million as of June 30, 2024 (down 
from $1.1 billion reported for the prior quarter). According to RBOPS, the 
open opportunity for enhancement related to the credit valuation model is 
unlikely to have any effect on the Main Street Lending Program’s portfolio 
valuation, credit loss reserve calculation, or other processes.
17GAO-24-106482. The 20 opportunities identified include those related to the Paycheck 
Protection Program Liquidity Facility, which is a non–CARES Act facility. 
18The credit evaluation model is used to monitor the credit quality of loans purchased by 
the facility.
RBOPS Completed Its 
Review of Almost All 
Reserve Bank Actions to 
Enhance Processes and 
Controls
Actual and Expected 
Losses Are Limited to the 
Main Street Lending 
Program
Page 11 GAO-25-107246 Federal Reserve Facilities 
As of the end of August 2024, about 46 percent of Main Street loans were 
outstanding, and about 46 percent had been fully repaid. However, about 
8 percent of loans had been charged off (either partially or fully) by that 
date, which may reflect borrowers’ first and second principal payments 
coming due starting in July 2023 and July 2024, respectively.19
Delinquencies have fluctuated over time, rising throughout most of the 
program’s life cycle but falling in recent quarters as many delinquent 
loans were charged off.
Since the Main Street Lending Program terminated in January 2021, Main 
Street borrowers generally have made regular and early (unscheduled) 
payments, resulting in fewer outstanding loans than expected at this point 
compared with the program’s repayment schedule.20 As of August 31, 
2024, 847 loans (or about 46 percent) of the 1,830 Main Street Lending 
Program loans remained outstanding. This accounted for about $7.5 
billion (or about 43 percent) of the total authorized loan amount.21 The 
number of outstanding loans has decreased steadily over time, as the 
number of loans that have been fully repaid or charged off has increased 
(see fig. 2). Across all loans, including those currently outstanding, the 
program has collected $1.89 billion in interest payments.22
19Banks charge off debts when they do not believe that a borrower will pay the amount 
owed. That is, charge-offs are the value of loans that are removed from the books and 
charged against loss reserves. However, because Main Street loans are recourse loans, 
borrowers are still responsible for repaying that debt.
20Loans issued under the Main Street Lending Program are recourse loans and have a 5-
year maturity, meaning they are expected to be fully repaid 5 years after the date of 
origination. As recourse loans, lenders can pursue the borrower’s assets in the event of 
default. 
21The total authorized amount is defined as the total amount eligible lenders have 
extended to eligible borrowers. 
22The amount of interest payments collected by the Main Street Lending Program relative 
to losses cannot be used as a measure of the program’s profitability, as it does not 
account for other program costs, such as those incurred for establishing and maintaining 
the program throughout its life cycle.
Nearly Half of Main 
Street Loans Have 
Been Fully Repaid, 
but Losses Have 
Increased
Outstanding Main Street 
Loans Declined as More 
Borrowers Made Full 
Repayments
Outstanding Loans
Page 12 GAO-25-107246 Federal Reserve Facilities 
Figure 2: Number of Outstanding Main Street Lending Program Loans, First Quarter 2021–Third Quarter 2024
Note: This figure reflects data through the end of August 2024, which only partially represents the third quarter of 2024. In addition, these counts reflect 
the final count of outstanding Main Street loans at the end of a given quarter. 
Distribution of outstanding loans by loan size. Since the Main Street 
Lending Program terminated in January 2021, the distribution of 
outstanding loans by loan size has generally aligned with the overall 
distribution of Main Street loans made under the program. However, since 
the fourth quarter of 2022, the smallest loans (valued at $1.2 million or 
less) have constituted a slightly larger share of outstanding loans. As of 
the end of August 2024, these smaller loans accounted for about 22 
percent of outstanding loans, although they account for 20 percent of all 
originated Main Street loans.
Distribution of outstanding loans by business size. As of the end of 
August 2024, the distribution of outstanding loans had shifted slightly 
toward smaller businesses, compared with the distribution of all Main 
Street loans. Businesses with annual revenues of $7.7 million or less at 
loan origination accounted for about 46 percent of outstanding loans, 
whereas these businesses represented about 40 percent of all Main 
Street borrowers.
Page 13 GAO-25-107246 Federal Reserve Facilities 
In contrast, businesses with annual revenues exceeding $7.7 million 
accounted for about 54 percent of outstanding loans but 60 percent of all 
Main Street borrowers (see fig. 3). This distribution generally aligns with 
our findings in 2023.23 It may reflect the varying abilities of businesses of 
different sizes to fully repay their loans in advance, which we discuss 
further below.
Figure 3: Percent of Outstanding Main Street Loans by Business Size, as of August 
2024
Note: Percentages may not sum to 100 percent due to rounding. In this figure, percentages are 
rounded individually for graphical presentation. 
aThis subtotal percentage does not equal the sum of the two percentages it represents due to 
rounding of the individual categories. 
Regional distribution of outstanding loans. The regional distribution of 
outstanding loans generally aligned with the overall distribution of all Main 
Street loans. As of the end of August 2024, most of the program’s 
outstanding loans were in the southern United States, particularly in 
census divisions 5 and 7 (South Atlantic and West South Central) (see 
fig. 4).24 This concentration is consistent with our findings in 2023.25
23GAO-24-106482, 31. 
24The Census Bureau divides the United States into a variety of geographies for analytical 
purposes. Regions are the largest geographic unit, dividing the country into four major 
areas, with U.S. territories (other than the District of Columbia) not represented in a formal 
region. Divisions are the second largest geographic unit, dividing the country into nine 
major areas. As with regions, U.S. territories (other than the District of Columbia) are not 
represented in a formal division.
25GAO-24-106482, 27. 
Page 14 GAO-25-107246 Federal Reserve Facilities 
When comparing the proportion of outstanding loans across census 
divisions, both the number and dollar amount of outstanding loans varied 
considerably across different regions of the United States. Across all 
census divisions, census division 4 (West North Central) had the highest 
percentage of loans outstanding by number and dollar amount in a 
division. In this division, 59 percent of loans remain outstanding by both 
number and dollar amount. Conversely, division 1 (New England) had the 
lowest percentage of loans outstanding by both number and dollar 
amount.
Figure 4: Outstanding Main Street Loans by Census Division, as of August 2024
Page 15 GAO-25-107246 Federal Reserve Facilities
Sectoral distribution of outstanding loans. The sectoral distribution of 
outstanding loans also generally aligned with the sectoral distribution of 
all Main Street loans. About 73 percent of outstanding loans were in 
service-providing sectors, while about 27 percent were in goods-producing sectors. This distribution is consistent with our findings in 
2023.26
Businesses in service-providing sectors accounted for the largest share of 
outstanding loans, both by number and dollar value. The top sectors were 
(1) leisure and hospitality and (2) trade, transportation, and utilities. 
However, the percentage of loans outstanding within each sector varied. 
Businesses in construction—a goods-producing sector—had the greatest 
percentage of loans outstanding by both number and dollar amount, with 
58 percent outstanding by number and 62 percent outstanding by dollar 
amount (see table 2). In contrast, loans to businesses in leisure and 
hospitality had the smallest share outstanding based on the number of 
loans. The “other services” sector had the smallest share based on dollar 
amount. This sector includes industries not classified within the defined 
service-providing sectors, such as personal and laundry services and 
repair and maintenance.
26GAO-24-106482, 27–28. 
Page 16 GAO-25-107246 Federal Reserve Facilities 
Table 2: Number and Dollar Amount of Outstanding Main Street Loans by Sector, as of August 2024
Sector Number of outstanding loans 
(% of all loans in sector)
Dollar amount outstanding, dollars in millions 
(% of total loan amount in sector)
Service-providing sectors 621 (44.5%) $5,225 (40.0%)
Leisure and Hospitality 153 (39.7%) $1,262 (36.8%)
Trade, Transportation, and 
Utilities
146 (45.8%) $1,290 (40.8%)
Professional and Business 
 Services 
121 (48.6%) $815 (37.3%)
Financial Activities 93 (48.9%) $876 (46.2%)
Education and Health Services 43 (44.3%) $506 (44.2%)
Information 37 (40.2%) $360 (39.7%)
Other Services 
(except Public Administration)
28 (43.8%) $117 (33.2%)
Goods-producing sectors 225 (52.0%) $2,263 (51.6%)
Construction 97 (58.4%) $696 (61.5%)
Manufacturing 76 (45.0%) $684 (40.0%)
Natural Resources and Mining 52 (53.1%) $883 (57.2%)
Source: GAO analysis of Federal Reserve Bank of Boston data. | GAO-25-107246
As of the end of August 2024, 850 loans (about 46 percent of all Main 
Street loans) had been fully repaid. These loans accounted for about $8.8 
billion (or about 51 percent) of the total authorized loan amount. These 
totals reflect a year-over-year increase of 238 loans and about $2.8 billion 
repaid since August 2023 (see fig. 5).
Fully Repaid Loans
Page 17 GAO-25-107246 Federal Reserve Facilities 
Figure 5: Number of Fully Repaid Main Street Loans, First Quarter 2021–Third Quarter 2024
Note: This figure reflects data through the end of August 2024, which only partially represents the third quarter of 2024. 
Distribution of fully repaid loans by loan size. The distribution of fully 
repaid loans by loan size generally aligned with the overall distribution of 
loans made, as of the end of August 2024. The smallest loans (valued at 
$1.2 million or less) accounted for about 18 percent of fully repaid loans, 
while representing 20 percent of all Main Street loans. In contrast, the 
largest loans (valued at more than $14.3 million) accounted for 22 percent 
of fully repaid loans, while representing 20 percent of all Main Street 
loans.
Distribution of fully repaid loans by business size. As of the end of 
August 2024, loans to larger businesses constituted a slightly larger share 
of fully repaid loans than those made to smaller businesses (see fig. 6). 
Specifically, loans to larger businesses (those with annual revenues 
exceeding $42.1 million) represented 20 percent of all loans but 
accounted for nearly 25 percent of fully repaid loans. In contrast, loans to 
smaller businesses (those with annual revenue of about $3.1 million or 
less) accounted for 20 percent of all borrowers but about 16 percent of 
fully repaid loans.
Page 18 GAO-25-107246 Federal Reserve Facilities 
Figure 6: Percent of Fully Repaid Main Street Loans by Business Size, as of August 
2024
Note: Percentages may not sum to 100 percent due to rounding. 
Regional distribution of fully repaid loans. As of the end of August 
2024, fully repaid loans were concentrated in the southern United States, 
consistent with our findings from 2023.27 Borrowers in census divisions 5 
(South Atlantic) and 7 (West South Central) fully repaid more loans, both 
by number and dollar amount, than borrowers in other areas of the United 
States. Fully repaid loans in Florida and Texas together accounted for 
almost one-third of all fully repaid loans.
The percentage of loans that had been fully repaid varied across different 
regions. Compared with other census divisions, division 6 (East South 
Central) had the highest percentage of fully repaid loans by number (59 
percent repaid), while division 1 (New England) had the highest 
percentage by dollar amount (74 percent repaid). In contrast, division 4 
(West North Central) had the lowest percentage of fully repaid loans, 
measured by both number and dollar amount (see fig. 7).
27GAO-24-106482, 36. 
Page 19 GAO-25-107246 Federal Reserve Facilities 
Figure 7: Fully Repaid Main Street Loans by Census Division, as of August 2024
Sectoral distribution of fully repaid loans. As of the end of August 
2024, about 80 percent of fully repaid loans were in service-providing 
sectors, while about 20 percent were in goods-producing sectors. This 
distribution generally aligns with our findings in 2023.28 Across all sectors, 
the percentage of fully repaid loans varied by both number and dollar 
amount. The information sector and the leisure and hospitality sector had 
the highest percentages of fully repaid loans, at about 59 and 56 percent, 
respectively, by number of loans repaid. In contrast, the construction 
28GAO-24-106482, 36–37. 
Page 20 GAO-25-107246 Federal Reserve Facilities 
sector had the lowest percentage of fully repaid loans, at about 32 
percent (see table 3).
Table 3: Number and Dollar Amount of Fully Repaid Main Street Loans by Sector, as of August 2024
Sector Number of fully repaid loans 
(% of all loans in sector)
Dollar amount fully repaid, dollars in millions 
(% of total loan amount in sector)
Service-providing sectors 682 (48.9%) $7,031 (53.8%)
Leisure and Hospitality 217 (56.4%) $2,008 (58.6%)
Trade, Transportation, and 
Utilities
144 (45.1%) $1,648 (52.1%)
Professional and Business 
 Services 
110 (44.2%) $1,253 (57.3%)
Financial Activities 80 (42.1%) $810 (42.7%)
Information 54 (58.7%) $544 (60.0%)
Education and Health Services 47 (48.5%) $597 (52.2%)
Other Services 
(except Public Administration)
30 (46.9%) $171 (48.7%)
Goods-producing sectors 168 (38.8%) $1,802 (41.1%)
Manufacturing 76 (45.0%) $952 (55.6%)
Construction 53 (31.9%) $330 (29.2%)
Natural Resources and Mining 39 (39.8%) $521 (33.7%)
Source: GAO analysis of Federal Reserve Bank of Boston data. | GAO-25-107246
As of the end of August 2024, 138 loans (or about 8 percent of all Main 
Street loans) had been partially or fully charged off, totaling about $969 
million in recorded losses, a significant increase year-over-year (about 
$781 million).29 Losses increased sharply during the fourth quarter of 
2023, with that trend continuing through the second quarter of 2024 (see 
fig. 8).
29Recorded losses reflect losses on the principal amount of Main Street loans.
Losses Have Increased, 
Particularly among 
Smaller Businesses
Page 21 GAO-25-107246 Federal Reserve Facilities 
Figure 8: Number and Dollar Amount of Main Street Loan Losses, Second Quarter 2021–Third Quarter 2024
Note: This figure reflects data through the end of August 2024, which only partially represents the third quarter of 2024. The dollar amount of losses 
reflects losses on the principal amount of Main Street loans. 
This significant increase in the number and dollar amount of losses may 
reflect the effects of increased interest payments and the first of three 
required principal payments coming due for Main Street loans. As we 
reported in 2023, higher interest rates have led to increased interest 
payments on outstanding loans for borrowers, potentially imposing 
financial burdens on businesses.30 The first principal payments, which 
began in July 2023 and continued through early 2024, required borrowers 
to pay 15 percent of their loan’s principal. The second principal payment 
of an additional 15 percent came due for most borrowers during the 
second half of 2024, which could lead to further losses. A balloon 
payment of 70 percent of the loan’s principal will come due for the earliest 
program participants in the second half of 2025.
Distribution of losses by loan size. Of the approximately 8 percent of 
Main Street loans that have experienced losses to date, losses by loan 
30GAO-24-106482, 33. Main Street loans are subject to adjustable interest rates based on 
a benchmark rate (generally, the Secured Overnight Financing Rate). Interest rates have 
generally stabilized since our 2023 report, but they may still be higher than borrowers 
initially anticipated. 
Page 22 GAO-25-107246 Federal Reserve Facilities 
size generally aligned with the distribution of Main Street loans at 
origination. For example, loans valued at $1.2 million or less represent 20 
percent of all loans and accounted for about 21 percent of charge-offs. In 
addition, the largest loans (valued at more than $14.3 million), which also 
represent 20 percent of all loans, accounted for about 18 percent of 
charge-offs (see fig. 9). The largest loans represented 2 percent of all 
losses when we last reported on losses in the Main Street program in 
2023, which reflects the changing spread of losses year-over-year.31
Figure 9: Percent of Main Street Loans with Losses by Loan Size, as of August 2024
Note: Percentages may not sum to 100 percent due to rounding. 
Distribution of losses by business size. Loans to smaller businesses 
accounted for a greater share of losses than loans to larger businesses, 
as of the end of August 2024. Specifically, loans to Main Street borrowers 
with annual revenue of about $3.1 million or less at the time of program 
entry—the program’s smallest businesses—represent 20 percent of all 
Main Street loans but about 28 percent of loans with losses to date. In 
comparison, the program’s largest businesses, those with annual 
revenues exceeding $42.1 million, also account for 20 percent of all loans 
but about 14 percent of loans with losses (see fig. 10). These largest 
businesses accounted for a smaller share of losses when we last 
reported on Main Street loans, at about 2 percent.32
31GAO-24-106482, 57. 
32GAO-24-106482, 58. 
Page 23 GAO-25-107246 Federal Reserve Facilities 
Figure 10: Percent of Main Street Loans with Losses by Business Size, as of August 
2024
Note: Percentages may not sum to 100 percent due to rounding. 
Regional distribution of losses. As of the end of August 2024, census 
region 3 (the South) accounted for the highest number and dollar amount 
of losses in the Main Street program.33 In this region, 81 loans 
experienced about $581 million in losses, resulting in a charge-off rate 
(that is, the number or dollar amount of loans charged off as a percentage 
of total loans in a region) of about 9 percent by number of loans and 
about 7 percent by dollar amount of loans. (See table 4.)
Table 4: Number and Dollar Amount of Main Street Loan Losses by Census Region, as of August 2024
Region Number of loans with losses 
(number of loans made)
Percent (%) of all 
loans in region that 
have been charged 
off
Dollar amount of losses, in 
millions 
(total dollar amount of 
loans made)
Percent of total loan 
amount in region 
that has been 
charged off
1 (Northeast) 17 (225) 7.6% $115 ($2,419) 4.8%
2 (Midwest) 10 (290) 3.4% $32 ($2,972) 1.1%
3 (South) 81 (927) 8.7% $581 ($8,378) 6.9%
4 (West) 29 (382) 7.6% $235 ($3,615) 6.5%
Source: GAO analysis of Federal Reserve Bank of Boston data. | GAO-25-107246
33As noted earlier, the Census Bureau divides the United States into various geographies 
for analytical purposes. We report losses by Census region rather than Census division 
due to the smaller percentage of loans that have incurred losses, compared with 
outstanding and fully repaid loans.
Page 24 GAO-25-107246 Federal Reserve Facilities
Sectoral distribution of losses. Loans with losses were concentrated in 
service-providing sectors, which generally reflects the overall distribution 
of Main Street loans. In particular, loans to the trade, transportation, and 
utilities sector accounted for the most losses by number (28), while loans 
to financial activities companies accounted for the highest losses by dollar 
amount (about $213 million).
Certain sectors have experienced higher charge-off rates than others. For 
example, based on dollar value, about 12 percent of loans made to 
construction businesses have been charged off. The financial activities 
sector had the second highest charge-off rate, about 11 percent by dollar 
value. In comparison, most sectors have experienced lower charge-off 
rates, ranging from about 3 to 6 percent.
Delinquencies have generally increased over the course of the Main 
Street Lending Program’s life cycle, but they began to decline after the 
fourth quarter of 2023 (see fig. 11).34
34The Federal Reserve Bank of Boston defines delinquent payments as any interest or 
principal payment that is 30 or more days late. We calculate the delinquency rate as the 
ratio of delinquent loans to outstanding loans at a given time. Generally, our delinquency 
rate refers to active Main Street loans only. It excludes charged-off loans, which are no 
longer considered active despite remaining in the Main Street portfolio for potential 
recovery during the 5-year term of the loan.
Delinquencies Have 
Fluctuated as Principal 
Payments Have Come 
Due and More Loans 
Have Been Charged Off
Page 25 GAO-25-107246 Federal Reserve Facilities 
Figure 11: Number of Active Main Street Delinquencies, Fourth Quarter 2021–Third Quarter 2024
Note: This figure reflects data through the end of August 2024, which only partially represents the third quarter of 2024. Delinquency counts include all 
instances as of each quarter, meaning individual loans may be represented multiple times. 
Federal Reserve Bank of Boston staff told us they attribute this decline to 
the fact that many delinquent loans were fully charged off, removing them 
from the count of active delinquencies. Our analysis of charge-offs and 
delinquencies shows that the charge-off rate in the second and third 
quarters of 2024 exceeded the delinquency rate among active loans (see 
fig. 12). This suggests that many delinquent loans were charged off and 
recorded as losses. The losses in the first two quarters of 2024 occurred 
after initial principal payments (15 percent of loan principal) came due for 
most borrowers in the second half of 2023. Some loans may have been 
charged off because borrowers were unable to make this initial principal 
payment.
Page 26 GAO-25-107246 Federal Reserve Facilities 
Figure 12: Main Street Charge-Off and Delinquency Rates, First Quarter 2021–Third Quarter 2024
Note: This figure reflects data through the end of August 2024, which only partially represents the third quarter of 2024. 
Distribution of delinquencies by loan size. Smaller loans accounted for 
more delinquencies than larger loans as of the end of August 2024. The 
smallest loans (valued at $1.2 million or less), which represent 20 percent 
of all loans, accounted for about 22.4 percent of delinquent active loans. 
In contrast, the largest loans (valued at more than $14.3 million), which 
also represent 20 percent of all loans, accounted for about 14 percent of 
delinquent loans.
Distribution of delinquencies by business size. Loans made to smaller 
businesses accounted for more delinquencies than those made to larger 
businesses. Specifically, loans to borrowers with annual revenue of $3.1 
million or less represent 20 percent of all loans but accounted for about 
30 percent delinquent active loans. Conversely, loans to larger 
businesses, which also represent 20 percent of all loans, accounted for 
about 11 percent of delinquent loans.
Regional distribution of delinquencies. The number of delinquent 
active loans varied across U.S. regions. Census region 3 (the South) had 
the highest number of delinquent active loans, with 66 loans (about 7 
percent of the region’s loans). Although census region 1 (the Northeast) 
Page 27 GAO-25-107246 Federal Reserve Facilities 
had fewer delinquent loans, at 16, its delinquency rate was equal to that 
of region 3.
Sectoral distribution of delinquencies. More delinquencies occurred in 
service-providing sectors than in goods-producing sectors, reflecting the 
distribution of loans at origination. The trade, transportation, and utilities 
sector had the most delinquent loans, with 27 active loans delinquent.
In contrast, other sectors had higher delinquency rates despite having 
fewer delinquent loans. For example, while the construction sector had 15 
active delinquent loans—tied for third highest of all sectors—it had a 
delinquency rate of about 9 percent, which is higher than any other 
sector.
We provided a draft of this report to the Federal Reserve and Treasury for 
review and comment. The Federal Reserve provided technical comments, 
which we incorporated as appropriate. Treasury informed us it had no 
comments.
We are sending copies of this report to the appropriate congressional 
committees, the Chair of the Board of Governors of the Federal Reserve 
System, and the Secretary of the Treasury. This report will also be 
available at no charge on GAO’s website at https://www.gao.gov. 
If you or your staff have any questions about this report, please contact 
me at (202) 512-8678 or clementsm@gao.gov. Contact points for our 
Offices of Congressional Relations and Public Affairs may be found on 
the last page of this report. GAO staff who made key contributions to this 
report are listed in appendix II.
Michael E. Clements
Director, Financial Markets and Community Investment
Agency Comments
Page 28 GAO-25-107246 Federal Reserve Facilities
List of Committees
The Honorable Patty Murray
Chair
The Honorable Susan Collins
Vice Chair
Committee on Appropriations
United States Senate
The Honorable Sherrod Brown
Chairman
The Honorable Tim Scott
Ranking Member
Committee on Banking, Housing, and Urban Affairs
United States Senate
The Honorable Sheldon Whitehouse
Chairman
The Honorable Chuck Grassley
Ranking Member
Committee on the Budget
United States Senate
The Honorable Maria Cantwell
Chair
The Honorable Ted Cruz
Ranking Member
Committee on Commerce, Science, and Transportation
United States Senate
The Honorable Kyrsten Sinema
Chair
The Honorable James Lankford
Ranking Member
Subcommittee on Government Operations and Border Management
Committee on Homeland Security and Governmental Affairs
United States Senate
Page 29 GAO-25-107246 Federal Reserve Facilities
The Honorable Tom Cole
Chairman
The Honorable Rosa DeLauro
Ranking Member
Committee on Appropriations
House of Representatives
The Honorable Jodey Arrington
Chairman
The Honorable Brendan Boyle
Ranking Member
Committee on the Budget
House of Representatives
The Honorable Patrick McHenry
Chairman
The Honorable Maxine Waters
Ranking Member
Committee on Financial Services
House of Representatives
The Honorable Sam Graves
Chairman
The Honorable Rick Larsen
Ranking Member
Committee on Transportation and Infrastructure
House of Representatives
Appendix I: Objectives, Scope, and 
Methodology
Page 30 GAO-25-107246 Federal Reserve Facilities 
The objectives of this report were to examine (1) the Board of Governors 
of the Federal Reserve System’s oversight and monitoring of the CARES 
Act facilities and (2) the status of Main Street loans and their 
characteristics and trends in loan performance.
To address the first objective, we analyzed documentation from the 
Federal Reserve’s Division of Reserve Bank Operations and Payment 
Systems (RBOPS). This included its policies and procedures pertaining to 
the monitoring and controls of the CARES Act facilities. We reviewed 
planning documents and summaries of completed reviews of the facilities. 
We also obtained written responses from Federal Reserve officials on 
RBOPS’s framework and approach for ongoing monitoring of the facilities 
and results of RBOPS’s oversight reviews.
We compared RBOPS’s monitoring plans against selected federal 
internal control standards, including the principles that management 
should establish and operate monitoring activities to monitor the internal 
control system and evaluate the results, and that management should 
remediate identified internal control deficiencies on a timely basis.1
Additionally, we reviewed the Federal Reserve’s periodic reports covering 
6-month periods from July 2023 to June 2024 and quarterly and annual 
financial statements for updates on potential and actual losses incurred 
by the Federal Reserve facilities. We also received written responses to 
discussion questions from RBOPS officials on their lending facility 
oversight and monitoring activities.
To address the second objective, we conducted on-site reviews of Main 
Street Lending Program data at the Federal Reserve Bank of Boston. To 
assess the status and characteristics of and trends in Main Street 
Lending Program loans, we retrieved information from two data sources: 
(1) a compendium from the Reserve Bank of borrower information 
collected in the lender registration and participation review processes and 
(2) Main Street accounting records that are generated by a third-party 
contractor. The compendium included borrower information at loan 
origination, as well as borrower-reported payment information. The 
accounting records included information on loan positions, loan 
transactions from inception, and loan delinquencies. We reviewed and 
1GAO, Standards for Internal Control in the Federal Government, GAO-14-704G 
(Washington, D.C.: September 2014). 
Appendix I: Objectives, Scope, and 
Methodology
Appendix I: Objectives, Scope, and 
Methodology
Page 31 GAO-25-107246 Federal Reserve Facilities
analyzed participation data and loan-level payment data as of the end of 
August 2024, the most recent data available.
We analyzed data from the program’s July 2020 inception through August 
2024 to determine:
• the number and dollar amount of Main Street loan payments, 
including interest and principal payments due and made;
• the number and dollar amount of outstanding, fully repaid, and 
charged-off loans;
• the number of delinquent loans; and
• the distribution of outstanding, fully repaid, charged-off, and 
delinquent loans by their loan and business sizes.
In addition, we analyzed geographic and sectoral information for 
outstanding, fully repaid, charged-off, and delinquent loans. For our 
geographic analysis, we used Main Street program data to match loan 
payment information as of August 2024 to geographic identifiers collected 
from borrowers at intake. To avoid revealing borrower-specific 
information, we aggregated geographic data at the census division level 
for outstanding and fully repaid loans and at the census region level for 
charged-off and delinquent loans. We reported the number of loans for 
each status category and analyzed dollar amounts for outstanding, fully 
repaid, and charged-off loans.
For our sectoral analysis, we used program data to match loan payment 
information to North American Industry Classification System (NAICS) 
codes collected from borrowers at intake. To avoid revealing borrowerspecific information, we aggregated Main Street borrowers’ designated 
NAICS codes into sectors defined by the Bureau of Labor Statistics. We 
further aggregated sectors into super-sectors.2 We reported the number 
of loans for each loan status (outstanding, fully repaid, charged off, and 
delinquent) by sector and super-sector. We also analyzed and reported 
dollar amounts for outstanding, fully repaid, and charged-off loans.
2According to the Bureau of Labor Statistics, NAICS codes can be grouped into 10 
sectors: construction; education and health services; financial activities; information; 
leisure and hospitality; manufacturing; natural resources and mining; professional and 
business services; trade, transportation, and utilities; and other services. These sectors 
can be further aggregated into super-sectors, which include a goods-producing supersector and a service-providing super-sector.
Appendix I: Objectives, Scope, and 
Methodology
Page 32 GAO-25-107246 Federal Reserve Facilities
To understand the relationship between delinquent and charged-off loans, 
we used Main Street loan performance data to calculate delinquency and 
charge-off rates on a quarterly basis. We first identified the number of 
outstanding, delinquent, and charged-off loans for each quarter from April 
2021 to August 2024. We then generated the delinquency and loss rates 
by dividing the number of delinquent or charged-off loans by the number 
of outstanding loans for each quarter.
We assessed the reliability of the Main Street data we used by reviewing 
agency documentation, including a data dictionary, and conducting 
electronic testing for outliers, missing data, and erroneous values. We 
also interviewed staff of the Federal Reserve Bank of Boston to discuss 
the interpretation and reliability of various data fields and how data are 
collected, stored, and maintained. We determined that the data were 
sufficiently reliable for describing selected characteristics of Main Street 
loans and payment performance.
We conducted this performance audit from December 2023 to December 
2024 in accordance with generally accepted government auditing 
standards. Those standards require that we plan and perform the audit to 
obtain sufficient, appropriate evidence to provide a reasonable basis for 
our findings and conclusions based on our audit objectives. We believe 
that the evidence obtained provides a reasonable basis for our findings 
and conclusions based on our audit objectives.
Appendix II: GAO Contact and Staff 
Acknowledgments
Page 33 GAO-25-107246 Federal Reserve Facilities 
Michael E. Clements, clementsm@gao.gov, (202) 512-8678
In addition to the contact named above, Tarek Mahmassani (Assistant 
Director), Zamir Ruli (Analyst in Charge), Blake Faucher, Daniel Flavin, 
John Karikari, Christopher Klemmer, Marc Molino, Jessica Sandler, 
Jennifer Schwartz, and Farrah Stone made key contributions to this 
report.
Appendix II: GAO Contact and Staff 
Acknowledgments
GAO Contact
Staff 
Acknowledgments
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