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Advice for Businesses in Dealing with the Expanding Coronavirus Events

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Daily Financial Regulation Update - Wednesday, June 24, 2020

By
FedACTion Task Force
On Jun 24, 2020

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Major Developments

Treasury, SBA Issues New Revision to Previous Interim Final Rules on Loan Forgiveness, Loan Review Procedures

June 22, 2020

The U.S. Department of the Treasury (Treasury) and the U.S. Small Business Administration (SBA) issued an interim final rule (IFR) revising interim final rules posted on the Treasury’s and SBA’s websites on May 22, 2020 (and published on June 1, 2020 in the Federal Register). The IFR changes key provisions in the previous interim final rules to conform to the Paycheck Protection Program Flexibility Act of 2020.

SBA Issues Guidance on Refinance of Economic Injury Disaster Loans, Remittance of Refinance Proceeds

June 22, 2020

The U.S. Small Business Administration (SBA) issued a Procedural Notice in order to provide guidance regarding when Paycheck Protection Program (PPP) loan proceeds must be used to refinance SBA Economic Injury Disaster Loans (EIDL), and to inform PPP lenders of the procedure for remitting to the SBA any PPP loan proceeds designated to refinance an outstanding EIDL.

Congress

Click here to view the full text of the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), Enacted March 27, 2020.

Click here to view the full text of the Paycheck Protection Program Increase Act of 2020, Enacted April 24, 2020.

Click here to view the full text of the Paycheck Protection Program Flexibility Act of 2020, Enacted June 5, 2020.

Click here to view a running list of proposed legislation from the Senate Committee on Banking, Housing, and Urban Affairs, Senate Committee on Small Business and Entrepreneurship, House Committee on Financial Services, and House Committee on Small Business.

U.S. House of Representatives

Committee on Financial Services

Waters Announces House Financial Services Hearing on Treasury and Federal Reserve’s Pandemic Response

June 22, 2020

Congresswoman Maxine Waters (D-CA), Chairwoman of the House Committee on Financial Services (Committee), announced that the Committee will hold a hearing on June 30, 2020 entitled “Oversight of the Treasury Department’s and Federal Reserve’s Pandemic Response.” Steven Mnuchin, Secretary of the U.S. Department of the Treasury, and Jerome Powell, Chair of the Board of Governors of the Federal Reserve System, will be witnesses at the hearing.

Waters, Neal, Velázquez Reiterate Demand for Full PPP Transparency

June 22, 2020

Congresswoman Maxine Waters (D-CA), Chairwoman of the House Committee on Financial Services, Congressman Richard E. Neal (D-MA), Chairman of the House Committee on Ways and Means, and Congresswoman Nydia M. Velázquez (D-NY), Chairwoman of the House Committee on Small Business, issued a statement following the U.S. Department of the Treasury’s (Treasury) and U.S. Small Business Administration’s (SBA) announcement that they would only disclose certain information regarding Paycheck Protection Program (PPP) loans and recipients. In their statement, Waters, Neal, and Velázquez repeated their demand, initially set forth in a June 13, 2020 letter, that “SBA and Treasury … provide us with the names of all recipients of PPP loans, the dollar amount of all loans received, and the names of all applicants that did not receive PPP loans”.

Federal Agencies

Federal Reserve Board

Federal, State Regulatory Agencies Issue Examiner Guidance for Assessing Safety and Soundness

June 23, 2020

The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the National Credit Union Administration and the Office of the Comptroller of the Currency, in conjunction with state bank and credit union regulators, issued examiner guidance to promote consistency and flexibility in the supervision and examination of financial institutions affected by COVID-19. The interagency guidance instructs examiners to consider the issues confronting institutions due to COVID-19, and to exercise appropriate flexibility in their supervisory response.

Conference of State Bank Supervisors

Ryan Issues Statement on OCC Bulletin on Preemption

June 22, 2020

John W. Ryan, President and CEO of the Conference of State Bank Supervisors (CSBS), issued a statement on the Office of the Comptroller of the Currency’s (OCC) June 17, 2020 bulletin asserting the National Bank Act would preempt certain types of state and local COVID-19 relief measures. In his statement, Ryan asserted that “[s]tate officials should continue to develop the COVID-19 relief measures they feel are appropriate based on the needs and circumstances of their citizens, despite the OCC’s recent anticipatory and categorical assertions of federal preemption.”

Securities and Exchange Commission

SEC Issues Guidance on Disclosure Considerations

June 23, 2020

The U.S. Securities and Exchange Commission (SEC) issued guidance on the SEC’s Division of Corporation Finance’s views on operations, liquidity, and capital resources disclosures companies should consider with respect to COVID-19-related business and market disruptions.

SEC’s Chief Accountant Issues Statement on Importance of High-Quality Financial Reporting

June 23, 2020

Sagar Teotia, Chief Accountant of the SEC, issued a statement on the continued importance of high-quality financial reporting for investors in light of COVID-19.

Consumer Financial Protection Bureau

CFPB Issues Interim Final Rule on Loss Mitigation Options for Homeowners

June 23, 2020

The Consumer Financial Protection Bureau (CFPB) issued an interim final rule (IFR) designed to ease consumers’ transition out of financial hardship caused by COVID-19, and to facilitate mortgage servicers’ assistance of those consumers. Among other provisions, the IFR clarifies that servicers do not violate Regulation X by offering certain COVID-19-related loss mitigation options based on an evaluation of limited application information collected from the borrower; normally, with certain exceptions, Regulation X requires servicers to collect a complete loss mitigation application before making an offer.

Department of Labor

Department of Labor Offers Webinar on Paid Sick Leave Requirements

June 23, 2020

The U.S. Department of Labor’s Wage and Hour Division (WHD) announced it is joining with the Internal Revenue Service and U.S. Small Business Administration to present a webinar to review paid sick leave requirements, tax relief and other COVID-19-related information for employers and business owners.  

Departments of Labor, Health and Human Services and Treasury Release FAQs on Family First Coronavirus Response Act

June 23, 2020

The U.S. Department of Labor, U.S. Department of Health and Human Services, and the U.S. Department of the Treasury released FAQs regarding implementation of the Families First Coronavirus Response Act, the CARES Act and other health coverage issues related to COVID-19.