Commercial Paper Funding Program - CPFP

AAA

DEFINITION of 'Commercial Paper Funding Program - CPFP'

A program instituted in October of 2008 that created the Commercial Paper Funding Facility (CPFF). The Commercial Paper Funding Program (CPFP) was designed to increase the liquidity of the commercial paper market by providing funding to issuers. The program specifically provided a backup measure of liquidity for commercial paper issuers via a Special Purpose Vehicle (SPV).

INVESTOPEDIA EXPLAINS 'Commercial Paper Funding Program - CPFP'

The SPVs were financed directly by the Federal Reserve Bank of New York and were used to purchase three-month commercial paper, both secured and unsecured. This financing was then to be secured by the assets placed into the SPVs and also by the fees paid by issuers of unsecured paper. The Treasury department felt that the program was required in order to prevent further substantial disruption of the financial markets.

RELATED TERMS
  1. Money Market Account

    An interest-bearing account that typically pays a higher interest ...
  2. Money Market Fund

    An investment fund that holds the objective to earn interest ...
  3. Bad Paper

    Unsecured short-term fixed income instrument that is issued either ...
  4. Money Market

    A segment of the financial market in which financial instruments ...
  5. Special Purpose Vehicle/Entity ...

    1. Also referred to as a "bankruptcy-remote entity" whose operations ...
  6. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, ...
Related Articles
  1. Asset-Backed Commercial Paper Carries ...
    Mutual Funds & ETFs

    Asset-Backed Commercial Paper Carries ...

  2. The Money Market
    Retirement

    The Money Market

  3. The Treasury And The Federal Reserve
    Bonds & Fixed Income

    The Treasury And The Federal Reserve

  4. Introduction To Commercial Paper
    Bonds & Fixed Income

    Introduction To Commercial Paper

comments powered by Disqus
Hot Definitions
  1. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  2. Odious Debt

    Money borrowed by one country from another country and then misappropriated by national rulers. A nation's debt becomes odious ...
  3. Takeover

    A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the ...
  4. Harvest Strategy

    A strategy in which investment in a particular line of business is reduced or eliminated because the revenue brought in by ...
  5. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  6. Pareto Principle

    A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The ...
Trading Center