Lynn Woosley is a Senior Director with Treliant. She is a seasoned executive with extensive risk management experience in regulatory compliance, consumer and commercial credit risk, credit and compliance risk modeling, model governance, regulatory change management, acquisition due diligence, and operational risk in both financial services and regulatory environments.
- Source: federalreserve.gov
Treliant knows bank regulation and risk management. If you need assistance with managing your institution’s risk during this pandemic, Treliant can help.
On March 24, 2020, the Federal Reserve Board (FRB) released a Statement on Supervisory Activities (FRB Statement), which provided state member banks, bank holding companies, and other financial institutions supervised by the FRB information on the changes in the FRB’s supervisory approach as a result of COVID-19.
The FRB Statement highlighted two key changes in supervisory activities. First, the FRB will have an increased focus on monitoring. Monitoring activities will be concentrated on the challenges and risks the pandemic poses for financial institution operations and financial conditions, employees, and customers, as well as analysis of capital, asset quality, liquidity, and operations. In addition, monitoring activities for large financial institutions will include financial stability and operational resiliency.
Second, recognizing the operational stress posed by the pandemic on financial institutions, the FRB is reducing examinations and inspections activity. Any examination activity will be conducted remotely until both the bank and the Reserve Banks resume normal operations. For institutions with less than $100 billion in consolidated assets, regular examination activity will be suspended unless the examination is critical to safety and soundness or consumer protection, or is need to address an urgent need.
At institutions with consolidated assets exceeding $100 billion, the FRB will defer a significant portion of planned examination activity based on assessment of the importance of the exam and the burden to the institution. Financial institutions will still be required to submit CCAR capital plans by April 6, 2020.
In addition, the FRB extended the time periods for remediating existing supervisory findings by 90 days, unless the FRB notifies the financial institution that a more rapid remediation is required. The FRB will reevaluate its supervisory activity at the end of April.
The FRB also reiterated its encouragement for financial institutions to work prudently with customers affected by the pandemic and to maintain communication with their Reserve Banks.
For additional information on addressing issues related to COVID-19, please refer to the following:
- Interagency Statement on Pandemic Planning
- Interagency Statement on Loan Modifications and Reporting for FIs Working with Customers Affected by Coronavirus
- FinCEN Encourages FIs to Communicate Concerns Related to COVID-19 and to Remain Alert to Related Illicit Suspicious Activity
- Employee Privacy in the Age of COVID-19
- FINRA Pandemic-Related Business Continuity Planning
- Defending against COVID-19 Cyber Scams
- Mitigating Fraud in the Wake of the Pandemic