Fed to suspend some bank supervision during viral outbreak
AP

Fed to suspend some bank supervision during viral outbreak

  • 0
Fed to suspend some bank supervision during viral outbreak

A Chase bank employee, right, disinfects the branches ATMs to fend off coronavirus as a customer uses another along Main St., Tuesday, March 24, 2020, in the Flushing neighborhood of Queens borough of New York.

WASHINGTON (AP) — The Federal Reserve said it will suspend some of its bank supervisory activities to give banks more leeway in dealing with financially strapped customers.

The Fed said it will cease nearly all examinations for banks with less than $100 billion in total assets, except for those reviews “critical to safety and soundness or consumer protection." For larger banks above that threshold, the Fed will postpone most of its examinations, based on how burdensome the scrutiny would be for each bank.

Tuesday's announcement follows earlier efforts by the Fed and other banking regulators to lighten regulatory oversight during the viral outbreak. The Fed is encouraging banks to work with borrowers who are unable to pay all their debts because of the coronavirus, which has crippled the economy and caused potentially millions of layoffs.

“The Federal Reserve understands that this unique and evolving situation could pose temporary business disruptions and challenges that affect banks, businesses, consumers, and the economy,” the central bank said in a statement.

The Fed said it will focus on monitoring the banking system, which includes “understanding the challenges and risks that the current environment presents for customers, staff, for firm operations and financial condition, and for the largest firms, the risks to financial stability."

On Sunday, the Fed and five other banking regulators said that banks that modified loans for people or businesses struggling to repay wouldn't have to hold more capital against those loans, as they have been required to do so in the past. That would make it easier for banks to allow easier repayment terms on some troubled loans.

Copyright 2020 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

Concerned about COVID-19?

* I understand and agree that registration on or use of this site constitutes agreement to its user agreement and privacy policy.

Related to this story

Most Popular

  • Updated

WASHINGTON (AP) — Bracing the nation for a coronavirus death toll that could exceed 100,000 people, President Donald Trump extended restrictive social distancing guidelines through April, bowing to public health experts who presented him with even more dire projections for the expanding coronavirus pandemic.

Get up-to-the-minute news sent straight to your device.

Topics

News Alerts

Breaking News