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Financial Services Law Insights and Observations

OCC, FDIC announce disaster relief guidance

Federal Issues OCC FDIC Consumer Finance Disaster Relief

Federal Issues

On September 14, the OCC issued a proclamation permitting OCC-regulated institutions, at their discretion, to close offices affected by Hurricane Sally “for as long as deemed necessary for bank operation or public safety.” The proclamation directs institutions to OCC Bulletin 2012-28 for further guidance on actions they should take in response to natural disasters and other emergency conditions. According to the 2012 Bulletin, only bank offices directly affected by potentially unsafe conditions should close, and institutions should make every effort to reopen as quickly as possible to address customers’ banking needs. Earlier in the week, the OCC also issued a proclamation permitting OCC-regulated institutions, at their discretion, to close offices affected by wildfires in Oregon and Washington.

Separately, on September 14, the FDIC issued FIL-89-2020 to provide regulatory relief to financial institutions and help facilitate recovery in areas of Puerto Rico affected by Tropical Storm Isaias. In the guidance, the FDIC notes that, in supervising institutions affected by the severe weather, the FDIC will consider the unusual circumstances those institutions face. The guidance suggests that institutions work with impacted borrowers to, among other things, (i) extend repayment terms; (ii) restructure existing loans; or (iii) ease terms for new loans to those affected by the severe weather, provided the measures are done “in a manner consistent with sound banking practices,” so the institutions can “contribute to the health of the local community and serve the long-term interests of the lending institution.” Additionally, the FDIC notes that institutions may receive Community Reinvestment Act consideration for community development loans, investments, and services that revitalize or stabilize designated disaster areas. The FDIC states, among other things, that it will also consider relief from certain filing and publishing requirements, and recommends institutions experiencing disaster-related compliance difficulties contact the New York Regional Office.

Find continuing InfoBytes coverage on disaster relief here.

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