Banks and their customers in Tennessee affected by devasting floods earlier this month are provided some regulatory relief from the federal insurer of deposits to help them recover.
The floods occurred in Middle Tennessee on or around Aug. 21; the area was declared a federal disaster area on Aug. 24.
In a financial institution letter (FIL-58-2021), the Federal Deposit Insurance Corp. (FDIC) said it encouraged banks to work constructively with borrowers in the area experiencing difficulties beyond their control because of damage caused by the severe weather.
As it typically does, the agency noted:
- 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.
- Banks may receive favorable Community Reinvestment Act (CRA) consideration for community development loans, investments, and services in support of disaster recovery.
- It also will consider regulatory relief from certain filing and publishing requirements.