Wednesday, July 14, 2010

Financial institutions affected by oil spill get help

Regulators Issue Statement to Assist Financial Institutions and Customers Affected by the Deepwater Horizon Oil Spill

The federal financial regulatory agencies and the Conference of State Bank Supervisors (the regulators) issued a statement today to assist financial institutions and their customers affected by the Deepwater Horizon Mobile Offshore Drilling Unit explosion and oil spill in the Gulf of Mexico.

The regulators’ statement emphasizes that financial institutions are encouraged to work with their customers and consider measures to assist creditworthy borrowers affected by the Gulf oil spill. Such measures can help customers recover financially and be better positioned to honor their obligations. In the affected areas, these efforts can also contribute to the health of local communities and the long-term interests of institutions and their customers.

Consistent with the regulators’ longstanding practice of assessing the financial condition of institutions directly affected by natural and other disasters, examiners will consider the unusual circumstances of banks and credit unions in affected areas in determining the appropriate supervisory response to safety-and-soundness issues.

Help includes:

  • Temporarily waiving late payment charges, ATM fees, and penalties for early withdrawal of savings;
  • Expediting lending decisions when possible, consistent with safety and soundness;
  • Extending or restructuring borrower debt obligations in anticipation of the receipt of funds based on claims the borrower may have filed with BP; and
  • Easing credit terms or fees for loans to certain borrowers, consistent with prudent banking practice.

The regulators are committed to working with the industry to respond to issues that arise in the aftermath of the Gulf oil spill and to minimize disruption and the burden on banks and credit unions in affected areas.

Posted By Valerie Garner

Categories: Finance

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