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**Office of Thrift Supervision **

[Department of the Treasury ]{.underline}*[Managing Director,
Examinations, Supervision, and Consumer Protection ]{.underline}*

1700 G Street, N.W., Washington, DC 20552 **•** (202) 906-7984

September 15, 2004

**MEMORANDUM FOR: CHIEF EXECUTIVE OFFICERS **

**FROM: **Scott M. Albinson

**SUBJECT: **Advisory on Hurricane Ivan

**PURPOSE **

Federal thrifts are not subject to a statutory restriction requiring a
declaration by the Office of\
Thrift Supervision (OTS) in order for institutions to close their
offices in the event of a natural\
disaster or other emergency. OTS, however, does receive frequent
inquiries about whether the\
agency will make a pronouncement permitting federal thrifts to close
their offices.

OTS regulated thrift institutions have discretion to make individual
decisions whether to\
maintain or close business operations in the event of a natural disaster
or other community\
emergency, including situations where an emergency is imminent. This is
often a difficult\
decision in which the interests of employee and customer safety must be
weighed against the\
needs and interests of customers in having access to their deposit funds
in anticipation of, or\
following, a natural disaster or other emergency situation.

Today's guidance, issued in anticipation of the imminent impact of
Hurricane Ivan, highlights\
the competing interests that must be weighed in making a decision to
close your offices. In\
addition, this guidance reminds you of OTS's disaster relief guidelines
set forth in OTS Thrift\
Bulletin (TB) 71.

**PRE-DISASTER PLANNING AND OPERATIONS CONTINUITY **

If your institution is in the path of Hurricane Ivan, you should
exercise the utmost care and\
caution to protect the personal safety of employees while continuing to
assist customers in need.\
You should consider all reasonable steps available to maintain
operations for as long as\
prudently possible to assist customers' cash and financial needs in
connection with hurricane\
preparations and evacuation procedures.

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In particular, you should continue to maintain and service ATM
facilities and other cash disbursement operations, as well as any other
operations essential to evacuation and hurricane preparedness for as
long as possible prior to the impact of Hurricane Ivan. Under no
circumstances, however, should the personal safety of your employees or
customers be compromised to maintain operations. In this regard, OTS
will work with you to maintain operations prior to the hurricane as well
as to help restore operations and continuity after Hurricane Ivan.

While it may be difficult to assess the potential impact of Hurricane
Ivan, effective communication will allay customer fears and concerns
while also protecting the personal safety of employees and customers. If
your institution is affected, OTS will assist you to ensure an effective
communication and business continuity strategy.

Finally, you are reminded about steps you may take to assist affected
customers in areas that experience the effects of Hurricane Ivan. In
particular, OTS examiners will give due consideration to modifications
to existing loans in areas impacted by the damage from Hurricane Ivan.

OTS also encourages all thrifts operating in or extending services near
areas affected by the hurricane to work with customers and affected
communities by considering:

-   • Temporarily waiving late payment charges and early withdrawal of
    savings penalties;

-   • Offering prudent loans to help rebuild damaged property after
    assessing the current community credit needs;

-   • Expediting lending decisions when possible, consistent with safety
    and soundness\
    principles;

-   • Restructuring borrowers' debt obligations, where appropriate, by
    altering or adjusting payment terms;

-   • State and federal guarantees and other means to help mitigate
    excessive credit risks; and

-   • All available programs offered by the Federal Home Loan Banks.

To facilitate rebuilding efforts in the areas affected by the hurricane,
while maintaining standards of safety and soundness, OTS will:

-   • Consider granting emergency exceptions to applicable appraisal
    standards;

-   • Take into account an institution's disaster relief efforts when
    evaluating the institution's CRA performance;

-   • Grant extensions of time for submission of regulatory filing
    requirements;

-   • Work with institutions that experience sudden growth due to
    temporary deposits of insurance proceeds;

-   • Allow reasonable loan documentation deficiencies necessitated by
    thrift office relocation or personnel shortages during the period of
    recovery efforts;

-3-

-   • Temporarily waive the Qualified Thrift Lender requirements for
    institutions meeting their capital requirements in order to help
    rebuild businesses; and

-   • Accelerate procedures to approve temporary facilities so that
    thrifts with destroyed or severely damaged facilities will be able
    to continue to serve their customers and communities.

OTS believes that these measures will help borrowers affected by the
hurricane to recover their financial strength and place them in a better
position to meet their financial obligations. These efforts will help to
revitalize affected communities and ensure the continued stability of
thrift institutions involved in the recovery of areas affected by the
hurricane. Additional information on OTS disaster relief guidelines is
in TB 71, which is available at the OTS web site at
[[www.ots.treas.gov/docs/8/84058.pdf](www.ots.treas.gov/docs/8/84058.pdf)]{.underline}[.
](www.ots.treas.gov/docs/8/84058.pdf)

Thrifts requiring assistance in dealing with customers in areas affected
by Hurricanes Ivan, Frances or Charley should contact their regional OTS
office. At the OTS Southeast Regional Office, in Atlanta, Georgia,
thrifts can contact Art Goodhand, at 404-888-8565, and at the OTS
Midwest Regional Office, in Dallas, Texas, thrifts can contact Duane
Thorkildsen at 972-277-9539.