|
Supervisory Practices Regarding Depository Institutions and Borrowers
Affected by Severe Storms, Flooding, Landslides, and Mudslides in Areas of
Colorado
The Federal Deposit Insurance Corporation (FDIC) recognizes the serious impact of
severe storms, flooding, landslides, and mudslides on customers and operations of
financial institutions in certain areas of Colorado and will provide regulatory
assistance to institutions subject to its supervision. These initiatives will
provide regulatory relief and facilitate recovery. The FDIC encourages depository
institutions in the affected areas to meet the financial services needs of their
communities.
The affected areas in Colorado are Adams, Boulder, Larimer, and Weld counties.
Lending: Bankers should work constructively with borrowers in
communities affected by the severe weather. The FDIC realizes that the effects of
natural disasters on local businesses and individuals are often transitory, and
prudent efforts to adjust or alter terms on existing loans in affected areas should
not be subject to examiner criticism. In supervising institutions affected by the
severe weather, the FDIC will consider 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 interest1 .
Community Reinvestment Act (CRA): Financial institutions may
receive CRA consideration for community development loans, investments, or services
that revitalize or stabilize federally designated disaster areas in their assessment
areas or in the states or regions that include their assessment areas. For
additional information, institutions should review the Interagency Questions and
Answers Regarding Community Reinvestment at http://www.ffiec.gov/cra/pdf/2010-4903.pdf
at Section 12(g)(4)(ii). For help in identifying community development activities to
revitalize or stabilize a disaster area, financial institutions can contact their
regional Community Affairs Officer (see http://www.fdic.gov/consumers/community/offices.html).
Investments: Bankers should monitor municipal securities and loans
affected by the severe weather. The FDIC realizes local government projects may be
negatively affected. Appropriate monitoring and prudent efforts to stabilize such
investments are encouraged.
Reporting Requirements: FDIC-supervised institutions affected by
the severe weather should notify the Dallas Regional Office if they expect a delay
in filing Reports of Income and Condition or other reports. The FDIC will evaluate
any causes beyond the control of a reporting institution when considering the length
of an acceptable delay.
Publishing Requirements: The FDIC understands the damage caused by
the severe weather may affect compliance with publishing and other requirements for
branch closings, relocations, and temporary facilities under various laws and
regulations. Banks experiencing 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 banking facilities by an institution whose
offices have been damaged or that desires to provide more convenient availability of
services to those affected by the severe weather. In most cases, a telephone notice
to the FDIC will suffice initially. Necessary written notification can be submitted
later.
1 Modifications of existing loans should be
evaluated individually to determine whether they represent troubled debt
restructurings (TDRs). This evaluation should be based on the facts and
circumstances of each borrower and loan, which requires judgment, as not
all modifications are TDRs.
|
