“Resilience in Finance: Interagency Statement from Federal and State Regulators on Wildfire Impact Assessment”

The California Department of Financial Protection and Innovation, the Federal Deposit Insurance Corporation, the Federal Reserve Board, the National Credit Union Administration, and the Office of the Comptroller of the Currency, collectively known as the agencies, acknowledge the severe consequences of the California wildfires and straight-line winds on customers and the operations of numerous financial institutions. They will offer suitable regulatory support to the institutions under their oversight that have been affected. The agencies urge institutions operating in the impacted regions to address the financial service needs of their communities.

A comprehensive list of current disaster areas is available at https://www.fema.gov/disaster/declarations.

Lending: The agencies encourage financial institutions to collaborate positively with borrowers in regions impacted by the California wildfires and straight-line winds. The agencies support prudent initiatives to modify or amend terms on existing loans in the affected areas and should not face criticism from examiners. In line with U.S. generally accepted accounting principles, institutions should assess modifications of existing loans individually to determine if adjustments made for borrowers facing financial hardships should be regarded as a new loan or as a continuation of an existing loan. When making this determination, institutions should take into account the specific conditions of each borrower and accurately report the modification in their call report. While supervising institutions affected by the California wildfires and straight-line winds, the agencies will factor in the extraordinary circumstances these institutions encounter. The agencies acknowledge that endeavors to assist borrowers in stressed communities can align with sound practices and serve the public good.

Temporary Facilities: The agencies recognize that many financial institutions are dealing with challenges related to staffing, power, telecommunications, and other issues when re-opening facilities post-California wildfires and straight-line winds. For situations where operational issues continue, the primary federal or state regulator will prioritize, as necessary, any requests to operate temporary facilities to ensure more accessible service availability for those impacted by the California wildfires and straight-line winds. Generally, a phone notification to the primary federal or state regulator will suffice initially to kickstart the approval process, followed by the required written notification shortly after.

Publishing Requirements: The agencies are aware that the destruction caused by the California wildfires and straight-line winds may hinder compliance with publishing and additional requirements for branch closures, relocations, and temporary facilities under various laws and regulations. Institutions facing disaster-related challenges in meeting any publishing or other obligations should connect with their primary federal or state regulator.

Regulatory Reporting Requirements: Institutions impacted by the California wildfires and straight-line winds that anticipate difficulties fulfilling the agencies’ reporting obligations should reach out to their primary federal or state regulator to discuss their circumstances. The agencies do not plan to impose penalties or undertake other supervisory measures against institutions that take reasonable and prudent steps toward compliance with the agencies’ regulatory reporting standards if those institutions are unable to wholly meet those requirements due to the California wildfires and straight-line winds.

The staff of the agencies are prepared to collaborate with affected institutions that might be struggling with their reporting responsibilities, considering each institution’s unique situation, including the status of its reporting and recordkeeping systems as well as the condition of its underlying financial documentation.

Community Reinvestment Act (CRA): Financial institutions may gain CRA consideration for community development loans, investments, or services that enhance or stabilize federally recognized disaster areas within their assessment regions or in the states or areas encompassing their assessment regions. For further details, refer to the Interagency Questions and Answers Regarding Community Reinvestment at https://www.ffiec.gov/cra/qnadoc.htm.

Investments: Institutions are encouraged to monitor municipal securities and loans impacted by the California wildfires and straight-line winds. The agencies recognize that local government projects may suffer adverse effects due to the disaster and urge institutions to undertake suitable monitoring and make prudent efforts to stabilize such investments.

For additional information, refer to the Interagency Supervisory Examiner Guidance for Institutions Affected by a Major Disaster, available as follows:

FDIC:

FRB:

NCUA:

OCC:

State financial regulators: