In response to Hurricane Sandy and the particular fury it wrought upon New York and New Jersey, the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, and the Federal Deposit Insurance Corporation have issued storm-related guidance for the financial institutions they oversee.

Lending

Bankers should “work constructively with borrowers in communities affected by Hurricane Sandy,” the regulators wrote, adding, “prudent efforts to adjust or alter terms on existing loans in affected areas should not be subject to examiner criticism.” In supervising institutions affected by the hurricane, the agencies will “consider the unusual circumstances they face” and recognize that efforts to work with borrowers in communities under stress “can be consistent with safe-and-sound banking practices as well as in the public interest.”

Community Reinvestment Act (CRA)

Financial institutions may receive CRA consideration for community development loans, investments, or services that revitalize or stabilize federally designated disaster areas in their assessment areas or in the states or regions that include their assessment areas. For additional information, institutions should review the "Interagency Questions and Answers Regarding Community Reinvestment" document.

Investments

Bankers should monitor municipal securities and loans affected by the hurricane, especially as local government projects may be negatively affected. “Appropriate monitoring and prudent efforts to stabilize such investments are encouraged,” the regulators wrote.

Reporting Requirements

Institutions affected by Hurricane Sandy that expect to encounter difficulty submitting accurate and timely regulatory report data for the Sept. 30, 2012, report date should contact their primary federal regulatory agency to discuss their situation. These regulatory reports include the Consolidated Reports of Condition and Income (Call Report) and holding company Y reports.

The agencies wrote that they do not expect to assess penalties or take other supervisory action against institutions that take reasonable and prudent steps to comply with regulatory reporting requirements but are unable to meet specified filing deadlines because of the effects of Hurricane Sandy. The agencies will take into account each institution's particular circumstances, including the status of its reporting and recordkeeping systems and the condition of its underlying financial records.

Publishing Requirements

The agencies understand that the damage caused by the hurricane may affect compliance with publishing and other requirements for branch closings, relocations, and temporary facilities under various laws and regulations. Institutions experiencing disaster-related difficulties in complying with any publishing or other requirements should contact their primary federal regulatory agency.

Temporary Banking Facilities

As many banks face power, telecommunications, staffing, and other challenges in re-opening facilities, the appropriate primary federal regulator will expedite any request to operate temporary banking facilities. In most cases, a telephone notice to the primary federal regulator will initially suffice initially, with necessary written notification submitted later.

A complete list of the affected disaster areas can be found at www.fema.gov.