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Supervisory Practices Regarding
Depository Institutions and Borrowers Affected by
Severe Storms, Tornadoes and Flooding in
Arkansas
The Federal Deposit Insurance Corporation (FDIC) recognizes the serious impact of
the
recent storms, tornadoes and flooding in Arkansas on the customers and operations of
financial institutions and will provide regulatory assistance to institutions
subject to its
supervision. These initiatives are being taken to provide regulatory relief and
facilitate
recovery. The FDIC encourages depository institutions in the affected disaster areas
to meet
the financial service needs of their communities.
Lending. Bankers should work constructively with borrowers in
communities affected by
the disasters. The FDIC realizes that the effects of natural disasters on local
businesses and
individuals are often transitory, and that prudent efforts to adjust or alter terms
on existing
loans in affected areas should not be subject to examiner criticism. In supervising
institutions impacted by the disasters, the FDIC will take into consideration the
unusual
circumstances they face. The FDIC recognizes that efforts to work with borrowers in
communities under stress can be consistent with safe and sound banking practices as
well as
in the public interest.
Reporting Requirements. FDIC-supervised institutions affected by
the disasters should
notify the FDIC's Dallas Regional Office if they expect a delay in filing their
Reports of
Income and Condition (Call Reports) or other reports. The FDIC will take into
consideration
any causes beyond the control of a reporting institution in considering how long of
a filing
delay will be acceptable.
Publishing Requirements. The FDIC understands that the damage
caused by the disasters
may affect compliance with publishing and other requirements for branch closings,
relocations and temporary facilities under various laws and regulations. Banks that
have
disaster-related difficulties in complying with any publishing or other requirements
should
contact the Dallas Regional Office.
Consumer Laws. Regarding consumer loans, Regulation Z provides
consumers an option to
waive or modify the three-day rescission period when a "bona fide personal financial
emergency" exists. To exercise this option, the consumer must provide the lender
with a
statement describing the emergency in accordance with the regulation.
Temporary Banking Facilities. The Dallas Regional Office will
expedite any request to
operate temporary bank facilities by an institution whose offices have been damaged
or that
desires to provide more convenient availability of services to those affected by the
disasters.
In most cases, a telephone notice to the regional office will suffice initially, and
necessary
written notification can be submitted later.
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