US financial authorities recognized the serious impact of Hurricane Milton on clients and lenders’ operations, which is why they encouraged institutions operating in the affected areas to facilitate their services.
“The agencies support prudent efforts to adjust or alter the terms of existing loans in affected areas and should not be subject to criticism from examiners,” noted the Federal Reserve Board and other entities such as the Federal Insurance Corporation. Deposits.
They added that in accordance with US accepted accounting principles, institutions must individually evaluate modifications of existing loans to determine whether they represent restructurings of problematic debt or modifications for borrowers experiencing financial difficulties.
“In making this evaluation, institutions must consider the facts and circumstances of each borrower and modification,” the Fed Board noted.
They indicated that banks and finance companies may receive Community Reinvestment Act consideration for loans, investments or community development services that revitalize or stabilize federally designated disaster areas in their assessment areas, or in states or regions that include their areas of evaluation.
In the case of investments, the government “encourages” institutions to monitor municipal securities and loans affected by Hurricane Milton.
“The agencies are aware that local government projects may be negatively affected by the disaster and encourage institutions to adequately monitor and take prudent measures to stabilize such investments,” they noted.
They added that when supervising the institutions affected by the hurricane they will consider the unusual circumstances they face.
“The agencies recognize that efforts to work with borrowers in stressed communities can be consistent with safe and sound practices, as well as in the public interest,” they indicated.
They urged placing and providing clients with temporary facilities, however, they noted that they understand that many financial institutions face staffing, energy, telecommunications and other challenges in reopening facilities after Hurricane Milton.
“In cases where operational challenges persist, the primary federal and/or state regulator will expedite, as appropriate, any request to operate temporary facilities to provide more convenient service availability to those affected by the hurricane,” they indicated.
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