April 27, 2020

The RESPONSE: Federal and State Actions Affecting the Financial Services Industry - Edition 13

Holland & Knight Alert
Holland & Knight's Financial Services Industry Group

Like our clients, Holland & Knight's Financial Services Industry Group is committed to actively contributing to our nation's response to the coronavirus (COVID-19) pandemic and related economic fallout and recovery efforts. For our part, Holland & Knight's 300-plus lawyers and professionals who comprise our Financial Services Industry Group want to ensure that bank and non-bank financial institutions, financial intermediaries and other financial services industry participants and stakeholders have access to timely, accurate and succinct updates on federal and state legislative, regulatory and administrative responses to the COVID-19 pandemic that are most relevant to our financial services clients.

To that end, we are pleased to share with you the latest edition of The RESPONSE.

President Trump Signs Paycheck Protection Program and Health Care Enhancement Act 

President Donald Trump has signed the Paycheck Protection Program and Health Care Enhancement Act, which appropriates an additional $310 billion to the Paycheck Protection Program (PPP), with $60 billion set aside for issuance by smaller lenders. 

SBA and Treasury Announce That PPP Loans Restart Today 

U.S. Small Business Administration (SBA) Administrator Jovita Carranza and U.S. Treasury Secretary Steven Mnuchin released a statement announcing that the PPP would resume accepting applications on Monday, April 27. More information can be found on the SBA's dedicated PPP web page

Federal Reserve Provides Consumers Increased Access to Their Accounts 

In order to provide consumers with more access to their accounts during financial hardship, the Federal Reserve has announced an interim final rule to amend Regulation D to remove the limit of six transfers per month on convenience transfers from the definition of "savings deposit." The interim final rule will allow depository institutions to give consumers an unlimited number of convenience transfers.   

OCC Reminds National Banks of Exclusivity of OCC Visitorial Authority 

The Office of the Comptroller of the Currency (OCC) has issued Bulletin 2020-43, emphasizing that, while a number of state and local officials have an interest in the successful implementation of programs intended to mitigate the effects of COVID-19, the OCC has exclusive visitorial authority over national banks. As such, state and local authorities are generally not allowed to conduct examinations, require the production of bank records or exercise other visitorial authority over banks, unless otherwise authorized by federal law. In the bulletin, the OCC advises national banks to contact their examiner-in-charge if they receive an attempt to exercise visitation over the bank by a state or local authority.

Even with the OCC bulletin reminder, state and local authorities may not hold the same position. 

OCC Prompts Banks to Prudently Document PPP Implementation and Lending Decisions 

The OCC has encouraged banks to maintain thorough documentation of the bank's PPP program administration and loan decisions, and to identify and tack PPP loan volumes. Doing so will help banks maintain prudent banking practice consistent with the principles of safety, soundness and fair access and fair treatment of borrowers, as well as other legal requirements. 

CFPB Provides Guidance on Preventing Consumer Harm When Transferring Mortgage Loans 

In recognition of the fact that consumers cannot direct the servicing of their mortgages, the Consumer Financial Protection Bureau (CFPB) has provided guidance related to maintaining compliance during the mortgage transfer process. Examples of actions contributing to compliance include, among others, developing transfer plans that include communication and testing, post-transfer quality control and the monitoring of consumer complaints. 

Pennsylvania Releases Guidance to Construction Businesses Set to Begin In-Person Operations 

Although Pennsylvania Gov. Tom Wolf had previously suspended all construction projects that did not support life-sustaining businesses, the construction industry is preparing to resume in-person operations on May 1. Gov. Wolf has released guidance on how to avoid the spread of COVID-19 as businesses resume work.

For questions, comments or additional information on any of these areas, please reach out to the Holland & Knight professional with whom you work or one of the following contacts in our Financial Services Industry Group.

About Our Financial Services Industry Group:

Participants in the financial services industry require sophisticated legal counsel to navigate a complex, ever-changing environment and respond to opportunities and challenges as they arise. With more than 300 members throughout the firm, Holland & Knight's Financial Services Industry Group has the depth and experience to effectively serve borrowers and lenders in all of their legal matters, including corporate services, international operations, labor and employment, litigation and dispute resolution, public policy and regulation, real estate and white collar defense. The combination of our thorough knowledge and a sincere commitment to provide responsive service is why clients entrust our team to handle their legal needs.

Holland & Knight has established a COVID-19 Response Team to help clients respond to a variety of business and legal issues they may be facing in this crisis. Please visit Holland & Knight's website for the latest COVID-19 news and updates important to your business.

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