15 U.S.C. § 9051: Temporary relief from…

Summary

Banks, credit unions, and insurance companies can choose to pause normal accounting rules for loan changes made because of COVID-19. The pause applies to changes made from March 1, 2020 until the earlier of January 1, 2022 or 60 days after the national emergency about COVID‑19 that the President declared on March 13, 2020 ends. The pause covers loan changes like forbearance, payment delays, interest‑rate changes, or repayment plans, and it lasts for the term of each such change. It only applies to loans that were not more than 30 days past due on December 31, 2019, and it does not apply to credit problems that are not related to COVID‑19. The federal regulators that oversee banks and similar institutions (as defined in law) must accept a lender’s choice to use this pause; the National Credit Union Administration is included. Lenders and insurers should keep records showing how many loans were changed, and the regulators may collect data about those loans for supervision.

Title 15, §9051

Commerce and Trade, Source: USLM XML via OLRC

(a)Definitions

In this section: (1) Applicable period

(2)Appropriate federal banking agency

The term “appropriate Federal banking agency”—

(A)has the meaning given the term in section 1813 of title 12; and

(B)includes the National Credit Union Administration.

(b)Suspension

(1)In general

During the applicable period, a financial institution, including an insurance company, may elect to—

(A)suspend the requirements under United States generally accepted accounting principles for loan modifications related to the coronavirus disease 2019 (COVID–19) pandemic that would otherwise be categorized as a troubled debt restructuring; and

(B)suspend any determination of a loan modified as a result of the effects of the coronavirus disease 2019 (COVID–19) pandemic as being a troubled debt restructuring, including impairment for accounting purposes under United States Generally Accepted Accounting Principles.

(2)Applicability

Any suspension under paragraph (1)—

(A)shall be applicable for the term of the loan modification, but solely with respect to any modification, including a forbearance arrangement, an interest rate modification, a repayment plan, and any other similar arrangement that defers or delays the payment of principal or interest, that occurs during the applicable period for a loan that was not more than 30 days past due as of December 31, 2019; and

(B)shall not apply to any adverse impact on the credit of a borrower that is not related to the coronavirus disease 2019 (COVID–19) pandemic.

(c)Deference

The appropriate Federal banking agency of the financial institution, including an insurance company, shall defer to the determination of the financial institution, including an insurance company, to make a suspension under this section.

(d)Records

For modified loans for which suspensions under subsection (a) apply—

(1)financial institutions, including insurance companies, should continue to maintain records of the volume of loans involved; and

(2)the appropriate Federal banking agencies may collect data about such loans for supervisory purposes.

Notes & Related Subsidiaries

Editorial Notes

References in Text

The National Emergencies Act, referred to in subsec. (a)(1), is Pub. L. 94–412, Sept. 14, 1976, 90 Stat. 1255, which is classified principally to chapter 34 (§ 1601 et seq.) of Title 50, War and National Defense. For complete classification of this Act to the Code, see

Short Title

note set out under section 1601 of Title 50 and Tables.

Amendments

2020—Subsec. (a)(1). Pub. L. 116–260, § 541(2), substituted “

January 1, 2022” for “

December 31, 2020”. Subsec. (b)(1). Pub. L. 116–260, § 541(1), inserted “, including an insurance company,” after “financial institution” in introductory provisions. Subsec. (b)(1)(B). Pub. L. 116–260, § 541(3), inserted “under United States Generally Accepted Accounting Principles” after “accounting purposes”. Subsec. (c). Pub. L. 116–260, § 541(1), inserted “, including an insurance company,” after “financial institution” in two places. Subsec. (d)(1). Pub. L. 116–260, § 541(4), inserted “, including insurance companies,” after “financial institutions”.

§9051 Temporary Relief From Troubled Debt Restructurings