#California Wildfires Hit Financial Institutions Hard#
Hot Topic Overview
Overview
California wildfires and straight-line winds have had a significant impact on financial institutions. Federal and state financial regulators have issued a cross-agency statement indicating that they will provide regulatory relief to affected financial institutions. The statement encourages financial institutions to work with borrowers in impacted communities to adjust or modify loan terms and supports institutions as they prudently assess existing loan modifications while meeting community financial service needs. Regulators will also expedite the approval process for temporary facilities for financial institutions in impacted areas and will be flexible with institutions that are unable to fully meet regulatory reporting requirements due to the disaster. Additionally, regulators encourage financial institutions to monitor municipal securities and loans in impacted areas and make prudent efforts to stabilize such investments.
Ace Hot Topic Analysis
Analysis
California wildfires and straight-line winds have significantly impacted many financial institutions' customers and operations. Federal and state financial regulators issued a cross-agency statement indicating they will provide appropriate regulatory relief to affected institutions. The statement encourages financial institutions to meet the financial service needs of disaster-impacted communities and to work constructively with borrowers in affected areas, including prudently modifying or altering existing loan terms, which should not be subject to examiner criticism. Regulators will consider the extraordinary circumstances faced by institutions in the disaster area and will expedite any requests for temporary operational facilities to facilitate disaster relief as appropriate. For institutions unable to fully meet regulatory reporting requirements due to the disaster, regulators will not penalize or take other supervisory action and will work cooperatively with impacted institutions, taking into account the specific circumstances of each institution. Furthermore, financial institutions may receive CRA consideration for community development loans, investments, or services to revitalize or stabilize the disaster area. Regulators also encourage institutions to monitor municipal securities and loans in the disaster area and to take prudent efforts to stabilize such investments.
Public Sentiment · Discussion Word Cloud
Public Sentiment
Discussion Word Cloud
Classic Views
Financial regulators will provide regulatory relief to financial institutions affected by the California wildfires and straight-line winds, encouraging institutions to meet the financial service needs of their communities.
Regulators encourage financial institutions to work constructively with borrowers in affected areas, to prudently adjust or modify loan terms, and to consider the facts and circumstances of the borrowers.
Regulators will consider the extraordinary circumstances faced by affected institutions and expedite requests for temporary facilities to assist disaster victims, as appropriate.
Regulators will be flexible in their reporting requirements for affected institutions and will not penalize institutions that cannot fully meet their requirements due to the disaster.