The Office of the Comptroller of the Currency (OCC) issued last week guidance for bank examiners on assessing banks impacted by major disasters, such as hurricanes.
The guidance addresses actions banks can take after a disaster has occurred to help customers and communities. It focuses on how examiners should rate banks that have been adversely affected by a natural disaster in declared major disaster areas.
The OCC encourages banks that are negatively impacted by a major disaster to discuss remediation plans with its examiners. It also applies to institutions that are located outside the area declared a major disaster, but have customers in the disaster area.
The guidance was jointly issued by the OCC, along with the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, and the National Credit Union Administration, in consultation with the Conference of State Bank Supervisors.
According to the OCC’s guidance, banks should conduct the initial risk assessments and then implement a process for refining the assessments as recovery efforts proceed and more information becomes available to them. In addition, examiners should consider the extent to which external problems related to the storm or major disaster — and its aftermath– are negatively affecting the bank.