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Louisiana Office of Financial Institutions declares emergency for state-chartered entities
On April 7, Louisiana Office of Financial Institutions (OFI) Commissioner John Ducrest declared a state of emergency and issued guidance for state-chartered financial entities in response to the Covid-19 crisis. The order granted: (i) Louisiana-based entities blanket parity with federally-chartered entities to offer Small Business Administration Paycheck Protection Program loans; and (ii) state-chartered financial institutions the authority to temporarily close or relocate branch offices, or otherwise reduce operations, services, and products. The order also provided guidance for reporting operational changes to OFI and adjusted annual meeting requirements to allow for remote conferencing. The declared state of emergency is set to extend through April 30, unless otherwise extended or renewed.
Freddie Mac issues guidance to seller/servicers on business continuity plans, borrower relief
On April 3, Freddie Mac issued guidance reminding seller/servicers to maintain a business continuity plan in accordance with the requirements of the Freddie Mac Single Family Seller/Servicer Guide. Sellers and servicers are expected to maintain the business continuity plan and to follow the plan during the Covid-19 pandemic. The guidance noted that Freddie Mac communicated with document custodians at four banks to confirm their business continuity plans are in place, and urged sellers using other document custodians to inquire with those custodians about their business continuity plans. Finally, the guidance summarized the relief that servicers should provide to borrowers impacted by Covid-19, including mortgage forbearance, waiving penalties and fees, halting foreclosure sales and evictions, suspending credit bureau reporting for delinquency related to forbearance, and offering loan modifications after the forbearance period.
Rhode Island Banking Division issues guidelines detailing flexibility for premium finance lenders
On April 3, the Rhode Island Department of Business Regulation Banking Division issued a bulletin asking premium finance companies to work with insured individuals and entities to maintain coverage during the Covid-19 crisis. The bulletin requests that premium lenders: (1) extend payment periods, implement alternative payment plans, and take other necessary steps to avoid the cancellation or lapse of coverage during the emergency period; (2) implement alternative payment methods, such as facilitation electronic payments; (3) consider waiving late payments and other penalties, and extend grace periods on statement due dates and; (4) streamline processes that might delay issuing new coverage or cause the lapse of existing coverage.
Minnesota Commerce Department issues statement on working with customers
The Minnesota Commerce Department released a statement encouraging financial institutions to work with customers affected by Covid-19. In particular, the Department encourages institutions to take various actions, including: waiving fees such as ATM, overdraft, and late fees; increasing ATM daily cash withdrawal limits; easing restrictions on cashing checks; increasing credit card limits for creditworthy borrowers; offering payment accommodations like forbearances; and easing terms for new loans to affected borrowers. Separately, the Department affirmed that it will consider these circumstances when reviewing an institution’s financial condition, and in working with institutions that encounter difficulty meeting regulatory reporting requirements or filing requirements for financial statements.
Arizona governor announces cooperation program with state banks to provide foreclosure and eviction protection
On March 30, Arizona Governor Doug Ducey announced a cooperative agreement with state banks to protect small businesses and families that have been impacted by the Covid-19 crisis from evictions and foreclosure. Under the initiative, banks and mortgage servicers are suspending evictions and foreclosures for up to 60 days, which may be extended longer to overlap with the declared state of emergency. Under the program, banks and servicers have established payment forbearance programs for mortgages, and also have established payment deferral programs for specific (non-mortgage) consumer loans and for small businesses. The announcement also noted that state banks are working to lend Paycheck Protection Program loans as provided by the Small Business Administration through the CARES Act.
New Jersey regulator announces residential mortgage relief initiative
On March 28, the New Jersey Department of Banking and Insurance announced that it is working with more than 40 banks, credit unions and servicers to provide relief to New Jersey homeowners. Under the new initiative, residents of New Jersey impacted by the Covid-19 pandemic may be eligible for a 90-day forbearance from mortgage payments and relief from fees and charges upon contacting their financial institutions. Cooperating institutions have also agreed not to start any foreclosure sales or evictions for 60 days.
Ohio Department of Commerce, Division of Financial Institutions issues guidance regarding branch closures
The Ohio Department of Commerce, Division of Financial Institutions issued guidance to assist financial institutions when making the decision to limit branch operations or to close a branch. The Division advised that temporary closures of banking office locations for 48 hours or less must be reported to the Division and closures lasting longer than 48 hours must receive advance permission.
Minnesota Department of Commerce designates banks and credit unions as critical sectors
On March 26, the Minnesota Department of Commerce clarified that banks, credit unions, and other financial services entities within the state are designated as critical sectors and will remain open during the Covid-19 crisis. Kelly’s remarks followed an executive order from Governor Tim Walz, which officially labeled financial services entities as critical sectors.
Mississippi governor orders restrictions on social gathering and non-essential business
On March 24, Mississippi Governor Tate Reeves ordered certain restrictions on social gatherings and restrictions on certain non-essential businesses. Any “Essential Business or Operation” may perform services or functions without regard to the limitations. Financial services, including banks, insurance, payroll, accounting, and processing services related to financial markets, and real estate services, including appraisal and title services, are deemed Essential Business.
Montana regulator issues guidance to state banks and credit unions on operating during outbreak
On March 19, the Montana Division of Banking and Financial Institutions issued a supervisory memorandum discussing operations of state-chartered banks and credit unions during the Covid-19 outbreak. The guidance instructs regulated institutions to communicate with the Division using email and electronic file transfer services instead of mail. The guidance also clarifies that the Division considers accepting deposits, providing access to cash and existing customer accounts, and drawing on existing loans to be “essential” services that should be continued during the outbreak, and contains frequently-asked questions about operations and regulatory notifications.