Eased regulatory reporting requirements and potential Community Reinvestment Act (CRA) credit for institutions working with those affected by severe storms and flooding in Puerto Rico were announced Monday by the Federal Deposit Insurance Corp. (FDIC).
The measures were communicated in a FDIC Financial Institution Letter (FIL-105-2020). As it usually does in addressing disasters, the FDIC on Monday said it is encouraging banks to work constructively with borrowers experiencing difficulties beyond their control because of damage caused by the severe storms and flooding in Puerto Rico, which occurred in September and spurred a federal disaster declaration by the Federal Emergency Management Agency (FEMA) Nov. 5.
“Banks that extend repayment terms, restructure existing loans, or ease terms for new loans in a manner consistent with sound banking practices, can contribute to the health of the local community and serve the long-term interests of the lending institution,” it said in the letter.
The letter notes that more FEMA designations may be ahead and includes a list of currently designated areas.