In a press release issued on August 17, 2023, key federal and state financial regulatory agencies announced measures to support financial institutions impacted by the Hawaii wildfires. The joint statement was released by the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Hawaii Department of Commerce and Consumer Affairs' Division of Financial Institutions, the National Credit Union Administration, and the Office of the Comptroller of the Currency.
The release stated that "the agencies are acutely aware of the wildfires' effect on the customers and operations of various financial institutions. They have collectively committed to offering appropriate regulatory assistance."
Among the highlighted lending practices, institutions are encouraged to work constructively with borrowers in affected communities, with the agencies supporting prudent adjustments to existing loans without fear of examiner criticism. The release also addresses temporary facilities, with a commitment to expedite requests to operate such facilities, acknowledging the operational challenges faced due to the wildfires. Additionally, the agencies expressed an understanding that compliance with regulations regarding branch closings, relocations, and temporary facilities may be impacted and encourage institutions facing difficulties to contact their regulators.
The press release further provides assurance regarding regulatory reporting requirements, stating that affected institutions taking reasonable compliance steps will not face penalties or supervisory action. There is also a section focused on the Community Reinvestment Act (CRA) and investments. According to the release, financial institutions may receive CRA consideration for actions helping to revitalize or stabilize disaster areas, and they are also encouraged to monitor and prudently handle municipal securities and loans impacted by the wildfires.
The press release emphasized the agencies' readiness to work with institutions that may encounter problems fulfilling reporting responsibilities, taking into account individual circumstances, including the status of reporting systems and the condition of financial records.
The agencies collectively stated, "The agencies recognize the serious impact of the recent Hawaii wildfires on the customers and operations of many financial institutions and will provide appropriate regulatory assistance to affected institutions subject to their supervision. The agencies recognize that efforts to work with borrowers in communities under stress can be consistent with safe-and-sound practices as well as in the public interest."