Steering to Assist Monetary Establishments and Facilitate Restoration in Areas of Puerto Rico Affected by Hurricane Fiona

September 26, 2022

The FDIC has introduced a collection of steps supposed to supply regulatory aid to monetary establishments and facilitate restoration in areas of Puerto Rico affected by Hurricane Fiona.

Assertion of Applicability: The contents of, and materials referenced in,
this FIL apply to all FDIC-supervised monetary establishments.

September 26, 2022 | FIL-42-2022

SUPERVISORY PRACTICES REGARDING DEPOSITORY INSTITUTIONS AND BORROWERS AFFECTED BY HURRICANE FIONA IN PUERTO RICO

The Federal Deposit Insurance coverage Company (FDIC) acknowledges the intense affect of Hurricane Fiona on clients and operations of monetary establishments in affected areas of Puerto Rico and can present regulatory help to establishments topic to its supervision.  These initiatives will present regulatory aid and facilitate restoration.  The FDIC encourages depository establishments within the affected areas to fulfill the monetary companies wants of their communities.

The affected municipalities in Puerto Rico are Adjuntas, Aguas Buenas, Aibonito, Arroyo, Barranquitas, Bayamón, Caguas, Canóvanas, Carolina, Cataño, Cayey, Ceiba, Ciales, Cidra, Coamo, Comerío, Corozal, Dorado, Fajardo, Florida, Guayama, Guayanilla, Guaynabo, Gurabo, Humacao, Jayuya, Juana Díaz, Juncos, Lares, Las Piedras, Luquillo, Maricao, Maunabo, Morovis, Naguabo, Naranjito, Orocovis, Patillas, Peñuelas, Ponce, Río Grande, Salinas, San Juan, San Lorenzo, Santa Isabel, Toa Alta, Toa Baja, Trujillo Alto, Utuado, Vega Alta, Vega Baja, Vieques, Villalba, Yabucoa and Yauco.

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Lending: The FDIC encourages bankers to work constructively with debtors in communities affected by Hurricane Fiona.  The FDIC realizes the results of pure disasters on native companies and people are sometimes transitory, and prudent efforts to regulate or alter phrases on present loans in affected areas shouldn’t be topic to examiner criticism.  In supervising establishments affected by Hurricane Fiona, the FDIC will contemplate the bizarre circumstances they face.  The FDIC acknowledges that efforts to work with debtors in communities beneath stress will be in keeping with safe-and-sound banking practices in addition to within the public curiosity.1

Group Reinvestment Act (CRA): Monetary establishments could obtain CRA consideration for group growth loans, investments, or companies that revitalize or stabilize federally designated catastrophe areas of their evaluation areas or within the states or areas that embrace their evaluation areas.  For added data, establishments ought to assessment the Interagency Questions and Solutions Concerning Group Reinvestment at Part 12(g)(4)(ii).  For assist in figuring out group growth actions to revitalize or stabilize a catastrophe space, monetary establishments can contact their regional Group Affairs Officer.

Investments: Bankers are inspired to watch municipal securities and loans affected by Hurricane Fiona.  The FDIC realizes native authorities initiatives could also be negatively affected and encourages bankers to interact in acceptable monitoring and take prudent efforts to stabilize such investments.

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Reporting Necessities: FDIC-supervised establishments affected by Hurricane Fiona ought to notify the New York Regional Workplace if they count on a delay in submitting Studies of Earnings and Situation or different reviews.  The FDIC will consider any causes past the management of a reporting establishment when contemplating the size of an appropriate delay. 

Publishing Necessities: The FDIC understands the harm attributable to Hurricane Fiona could have an effect on compliance with publishing and different necessities for department closings, relocations, and momentary amenities beneath numerous legal guidelines and laws.  Banks experiencing disaster-related difficulties in complying with any publishing or different necessities ought to contact the New York Regional Workplace.

Shopper Legal guidelines: For customers’ principal dwelling-secured loans, Regulation Z supplies customers an choice to waive or modify the three-day rescission interval when a “bona fide private monetary emergency” exists.  To train this feature, the client should present the lender with a press release describing the emergency in accordance with the regulation.

Momentary Banking Services: The New York Regional Workplace will expedite any request to function momentary banking amenities by an establishment whose workplaces have been broken or that wishes to supply extra handy availability of companies to these affected by Hurricane Fiona.  Most often, a phone discover to the FDIC will suffice initially.  Establishments could submit needed written notification later.

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1 Establishments that report modifications of present loans in accordance with Accounting Requirements Codification (ASC) Subtopic 310-40, Receivables – Troubled Debt Restructurings by Collectors ought to consider these modifications individually to find out whether or not they characterize troubled debt restructurings.  For establishments which have adopted ASC Subject 326, Monetary Devices – Credit score Losses, and Accounting Requirements Replace (ASU) 2022-02, Troubled Debt Restructurings and Classic Disclosures, modifications of present loans needs to be evaluated individually to find out whether or not the modification of the present mortgage is a modification to a borrower experiencing monetary issue.  Beneath each ASC and ASU, this analysis needs to be primarily based on the info and circumstances of every borrower and modification.