In bank examinations, the Federal Reserve Bank of Atlanta will not penalize banks for “emergency decisions” made in response to the pandemic, Atlanta Fed President and CEO Raphael Bostic said today, according to a report in the Wall Street Journal.
“We’ve tried to be as clear as possible that we will remember that banks have operated in an emergency situation, have made emergency decisions, and we won’t penalize them for that nine to 12 months from now when we do our regulatory reviews,” Bostic said via videoconference at a Nashville business event. “I’m going to make sure we hold to that.”
Bostic acknowledged that banks have been encouraged by the Fed to “deploy their capital as much as they can, to provide loans, to work with their borrowers, to find ways to help reduce the stresses, the short-term stresses many business and many families are feeling,” adding that he has been pleased that bankers “are doing this of their own accord [and]are eager to do it.” Bostic’s remarks come as some bankers have expressed concern that actions to support customers amid the pandemic may be criticized by regulators in hindsight.
