Due to strains on the U.S. economy as a result of the COVID-19 Global Pandemic, the Banking Regulatory agencies’ final rule allows regulated institutions to expeditiously extend liquidity to creditworthy households and businesses. Under the final rule, regulated institutions may defer: required appraisals and evaluations for up to 120 days for all residential and commercial […]

The Federal Reserve released their September 2020 supplementary Senior Loan Officer Opinion Survey on Bank Lending Practices (SLOOS) to understand the experiences of domestically chartered banks with the Main Street Lending Program (MSLP). The survey consisted of a set of questions that focused on four areas: commercial and industrial (C&I) loan inquiries and banks’ participation […]

“Borrowers facing identified financial difficulties as they near the end of the accommodation periods generally pose greater credit risk.” On August 3, 2020, the Federal Financial Institutions Examination Council (“FFIEC”) issued a joint statement with further guidance regarding COVID-19 loan modifications, as Borrowers are nearing the end of their initial accommodation/deferment period and are approaching […]

The Federal Reserve System has released their “July 2020 Senior Loan Officer Opinion Survey on Bank Lending Practices” report (1), which addresses the changes in the standards and terms on, and demand for, bank loans to business and households. Commercial and Industrial (C&I) Lending Respondent Institutions have indicated that while some have tightened or simply […]

By the end of 2020 it is estimated that U.S. community banks could face a 50% decrease in earnings due to spikes in credit costs. Second-quarter earnings have not yet exposed a significant decline in credit quality, in part due to deferrals of interest and/or principal payments on their loans as promoted under the CARES […]

On Monday June 15th the Federal Reserve announced that it is resuming examinations for Banks of all sizes. The Fed specifically stated that the rationale for this decision is that “As financial institutions have had time to implement contingency operating plans and adapt operations to the COVID-19 operating environment, the Federal Reserve is resuming examination […]

On May 8, 2020, the FDIC, Federal Reserve Board, OCC and NCUA, jointly issued the final Interagency Guidance on Credit Review Systems (1).  Below is a summary of the guidance as provided by CEIS Review. This Interagency Guidance (1) replaces the guidance in– Loan Review Systems, which is part of the December 2006 Interagency Policy Statement on […]

On February 20, 2020, the four US Banking regulators (OCC, FRB, FDIC and NCUA) issued the final policy statement for the financial institution adoption of CECL, the FASB (ASU 2016-13) change from an incurred loss (IL) reserving methodology to an expected loss (EL) methodology. This methodology is a forward looking reserve determination and is calculated […]