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SEC extends permission for virtual fund board meetings
On June 19, the Securities and Exchange Commission extended conditional relief from its requirements for in-person voting boards of directors of registered management investment companies and business development companies (previously covered here). Instead, votes may be cast using any communication that permits all participating directors to hear each other simultaneously during the meeting. The commission extended the relief through December 31, 2020.
Washington Department of Financial Institutions amends guidance for state regulated and exempt residential mortgage loan servicers
On June 19, the Washington Department of Financial Institutions issued amended guidance that replaces guidance issued in March to Washington State regulated and exempt residential mortgage loan servicers regarding support for consumers impacted by Covid-19. The amended guidance urges mortgage servicers to continue to assist consumers adversely impacted by Covid-19. The department further urges services to take “reasonable and prudent actions through September 30, 2020, subject to the requirements of any related guarantees or insurance policies” to support mortgagors by: (1) forbearing mortgage payments; (2) refraining from certain credit reporting; (3) offering additional time to complete trial loan modifications; (4) ensuring that late payments do not adversely affect a consumer’s ability to obtain permanent loan modifications; (5) waiving certain fees; (6) postponing foreclosures; (7) ensuring mortgagors do not experience service disruptions as a result of office closures; and (8) proactively reaching out to mortgagors to explain the assistance being offered.
Work-from-home no action position extended by Connecticut banking commissioner
On June 19, the banking commissioner in Connecticut issued a memorandum extending its “no action” position regarding temporary work-from-home guidance. Previously covered here and here, the memorandum permits consumer credit licensees to work from home, even though such home location is not licensed by the Banking Department, so long as certain criteria spelled out in the memorandum are met. The guidance is extended through August 31, 2020.
SBA’s Lender Match connects small businesses to small asset lenders
On June 19, the Small Business Administration (SBA) released a dedicated online tool that will match small businesses and non-profits impacted by the Covid-19 pandemic with Community Development Financial Institutions (CDFIs), Minority Depository Institutions, Certified Development Companies, Farm Credit System lenders, Microlenders, and traditional smaller-asset size lenders participating in the Paycheck Protection Program (PPP). Lender Match, which was paused due to CARES Act implementation priorities and loan volume, is being reinstated as an additional resource for small businesses that have not applied for or received approval for a PPP loan. Leads will only be forwarded to CDFIs and lenders with less than $10 billion in assets until the PPP program ends on June 30, 2020, at which point Lender Match will open to all participating SBA lenders. Applicants that are matched with lenders through the tool will receive an email within in two business days, which will allow them to immediately begin the application process for PPP loans and other SBA lending products. SBA notes, however, that Economic Injury Disaster Loan (EIDL) applications will not be accepted through Lender Match. Qualified small businesses and agricultural businesses must apply for EIDLs through a recently reopened portal (covered by InfoBytes here).
Kraninger emphasizes need for FCRA and CARES Act compliance
On June 19, CFPB Director Kathy Kraninger spoke during a Consumer Data Industry Association webinar, warning information furnishers and consumer reporting agencies (CRAs) that the Bureau has dedicated significant resources toward enforcement of certain provisions of the CARES Act and the FCRA. Specifically, Kraninger emphasized the Bureau’s reliance on consumer complaint data to inform its supervisory and enforcement activity and noted that April and May had the highest monthly complaint volumes in the Bureau’s history, with approximately 7,200 complaints mentioning Covid-19 related terms during that time. Kraninger referenced the Bureau’s April policy statement, which stated the Bureau would take a “flexible supervisory and enforcement approach during this pandemic regarding compliance with the [FCRA] and Regulation V” (covered by InfoBytes here). However, Kraninger warned that furnishers are still required to comply with the CARES Act, and that the “Bureau expects CRAs and furnishers to make good faith efforts to investigate disputes as quickly as possible.” According to Kraninger, due to the unique challenges the Covid-19 pandemic has created, the Bureau will evaluate each CRA and furnisher’s respective efforts and circumstances on an individual basis to determine whether it made the good faith effort to investigate as quickly as possible.
Fed vice chairman discusses stress testing adaptability due to Covid-19 pandemic
On June 19, Federal Reserve Vice Chair for Supervision Randal K. Quarles spoke at a meeting of the Women in Housing and Finance regarding adjustments to the Fed’s periodic stress testing of large banks in the wake of Covid-19. Quarles explained that because the Fed lacked the time and comprehensive data to run a complete and updated Covid-19 event stress test this year, the Fed made the decision to continue with the “severely adverse scenario” begun in February 2020, while also performing a new “sensitivity analysis.” The sensitivity analysis considers three distinct downside risk paths for the economy—a rapid recovery, a slower recovery, and a W-shaped double-dip recession.
As in past years, the Fed intends to disclose annual stress test results using the February 2020 scenario (run against bank exposures as of December 2019), which will include both firm-specific and aggregate results. Quarles also indicated the Fed would be disclosing some results from the new sensitivity analysis. According to Quarles, these results will not be firm-specific, but will be “aggregated across banks comparing how the banking system as a whole would fare under the three distinct views of the future.” The Fed also plans to “move ahead and provide all banks subject to stress testing with a stress capital buffer requirement based on the February 2020 scenario, under [the Fed’s] new approach integrating stress testing with capital requirements.” Once banks determine their final plans, the Fed will publicly release the final capital requirements for each individual bank later this year before they take effect in the fourth quarter as planned. Quarles also noted that additional policy actions, if warranted, may be taken in the coming months as the Fed continues to monitor the economic conditions.
Nebraska to accept in person business filings
On June 18, the Nebraska secretary of state announced that its Business Services division will be open to the public for business filings, notarizations, and UCC filings. Appointments are required and masks must be worn for in-person appointments.
New York Department of Financial Services announces remote online testing for insurance licensing exams
On June 11, the New York Department of Financial Services announced that remote online proctored testing will be available beginning on June 15, 2020, for all 28 New York insurance licensing exams. As a result, candidates will be able to take exams at a testing center or from their home or office.
Missouri extends executive order regarding remote notary services
On June 11, the Missouri governor issued an executive order extending, among others, Executive Order 20-08 relating to remote notary services, which was previously covered here. The extension permits notarial acts to be performed using audio-video technology, provided certain conditions are met, through August 28.
California governor extends time period to submit real estate renewal applications, fees, and continuing education requirements
On June 15, the California governor issued Executive Order N-69-20, which extends the provisions of the governor’s April 16 executive order, Executive Order N-52-20, and grants an additional 60-day extension to submit real estate license renewal applications, fees, and continuing education requirements. The California Department of Real Estate also updated its FAQs for applicants and licensees regarding Executive Order N-69-20 and Executive Order N-52-20.