Community banking

Community advocates would like to see changes to the 1977 Community Reinvestment Act, but say regulators should suspend such efforts until the coronavirus pandemic has passed.

Measures that delay the Current Expected Credit Losses standard and reduce a community bank capital ratio are temporary, but the industry now sees an opening to argue that they should be permanent.

The government should encourage community lenders to offer six-month loan repayment forbearances to struggling businesses before it’s too late.

The central bank is creating a facility to provide financing to banks participating in the Small Business Administration’s Paycheck Protection Program.

Lenders can offer deferred payments and capitalize on digital banking to help small businesses and consumers get back on their feet.

The regulation established standards for investors who own less than a quarter of an institution. Banks are getting more time for implementation as they focus on effects of the COVID-19 pandemic.

Regulators are allowing banks that implemented the loan-loss standard to forestall any capital hits until 2022.

Many banks are offering low-interest loans to help consumers and small businesses withstand the economic shocks of the pandemic. Some are also doing away with ATM, overdraft and late fees because, as one CEO put it, that revenue “is not the most important thing right now.”

Banks and credit unions should make it their top priority to pair with the central bank in distributing financial relief to small businesses, even if that means putting everything else on hold.

As companies move work off-site because of the pandemic, a host of issues have arisen around remote access, network monitoring and cybersecurity.