Fed's lending programs aren't for insolvent oil drillers, Dallas Fed's Kaplan says

SAN FRANCISCO (Reuters) – Insolvent or overly leveraged firms, including oil drillers and oil services firms, won’t be able to tap the Federal Reserve’s emergency lending program for “Main Street,” Dallas Federal Reserve Bank President Robert Kaplan said Wednesday.

“It has to be a loan that would have passed already the bank’s lending standards,” Kaplan said in an interview on Yahoo Finance, adding that only creditworthy companies will get loans. “If you are a company on the other hand that is more highly leveraged than that, concerned about insolvency, and other credit issues…it’s not going to be able to access those programs, and there will be a substantial number of bankruptcies, restructurings, that are going to have to happen, because so much of (oil) production is being shut in.”

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