On March 22, 2020, regulators released an interagency statement on loan modifications by financial institutions working with customers affected by the coronavirus. This statement applies to institutions with total assets under $1 Billion and states that institutions will not be criticized for short-term loan modifications related to COVID-19, so long as the borrower was current prior to the modification. These modifications will not automatically be considered troubled debt restructurings (TDRs).
This statement will give banks more flexibility in helping businesses restructure loan terms to get through the current crisis. Check back for updates regarding SBA disaster assistance loans and relief loans in the bill currently being discussed in Congress.