I 

116TH CONGRESS 

2D SESSION H. R. 7913 

To amend the CARES Act to improve the temporary relief from troubled 

debt restructurings, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 31, 2020 

Mr. LUETKEMEYER introduced the following bill; which was referred to the 

Committee on Financial Services 

A BILL 

To amend the CARES Act to improve the temporary relief 

from troubled debt restructurings, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Financial Institution 

5 Forbearance Act’’. 

6 SEC. 2. TEMPORARY RELIEF FROM TROUBLED DEBT 

7 RESTRUCTURINGS. 

8 (a) DEFINITIONS.—Section 4013(a) of the CARES 

9 Act (15 U.S.C. 9051(a)) is amended— 


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1 (1) in paragraph (1), by striking ‘‘the earlier of 

2 December 31, 2020, or the date that is 60 days 

3 after the date on which the national emergency con4 cerning the novel coronavirus disease (COVID–19) 

5 outbreak declared by the President on March 13, 

6 2020 under the National Emergencies Act (50 

7 U.S.C. 1601 et seq.) terminates’’ and inserting 

8 ‘‘March 1, 2021’’; and 

9 (2) by adding at the end the following: 

10 ‘‘(3) DEPOSITORY INSTITUTION.—The term ‘de11 pository institution’— 

12 ‘‘(A) has the meaning given the term in 

13 section 3 of the Federal Deposit Insurance Act; 

14 and 

15 ‘‘(B) means a State or Federal credit 

16 union, as such terms are defined, respectively, 

17 under section 101 of the Federal Credit Union 

18 Act. 

19 ‘‘(4) FINANCIAL INSTITUTION.—The term ‘fi20 nancial institution’ means— 

21 ‘‘(A) a depository institution; 

22 ‘‘(B) a lender that is not a depository in23 stitution; and 

24 ‘‘(C) an insurer.’’. 


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1 (b) APPLICABILITY.—Section 4013(b)(2)(A) of the 

2 CARES Act (15 U.S.C. 9051(b)(2)(A)) is amended by 

3 striking ‘‘December 31, 2019’’ and inserting ‘‘March 1, 

4 2020’’. 

5 (c) TREATMENT BY REGULATORS.—Section 4013 of 

6 the CARES Act (15 U.S.C. 9051) is amended— 

7 (1) in subsection (c), by striking ‘‘financial in8 stitution’’ each place such term appears and insert9 ing ‘‘depository institution’’; and 

10 (2) by adding at the end the following: 

11 ‘‘(e) TREATMENT BY REGULATORS.— 

12 ‘‘(1) IN GENERAL.—With respect to any loan 

13 for which an election has been made by a depository 

14 institution under subsection (b), the appropriate 

15 Federal banking agency— 

16 ‘‘(A) at the election of the depository insti17 tution, shall not require the depository institu18 tion to classify such loan as impaired for credit 

19 risk until April 1, 2022; and 

20 ‘‘(B) at the election of the depository insti21 tution, shall, until April 1, 2022, for the pur22 pose of calculating reserves and capital, and for 

23 any other accounting purpose, allow a deposi24 tory institution to treat such loan in the same 


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1 manner as the loan was (or would have been) 

2 treated on December 31, 2019. 

3 ‘‘(2) LIMITATION.— 

4 ‘‘(A) IN GENERAL.—Paragraph (1) shall 

5 not apply to a depository institution if the ap6 propriate Federal banking agency determines 

7 that— 

8 ‘‘(i) the depository institution was not 

9 well capitalized as of December 31, 2019; 

10 ‘‘(ii) applying paragraph (1) to the 

11 depository institution would pose a direct 

12 risk to the Deposit Insurance Fund or the 

13 National Credit Union Share Insurance 

14 Fund; or 

15 ‘‘(iii) there is reasonable cause to be16 lieve that the depository institution or an 

17 institution-affiliated party is violating, or is 

18 about to violate, a Federal statute or rule. 

19 ‘‘(B) CEASE AND DESIST LETTER RE20 QUIREMENT.—Before the appropriate Federal 

21 banking agency may make a determination 

22 under clause (ii) or (iii) of subparagraph (A), 

23 the appropriate Federal banking agency shall 

24 issue a cease and desist order to the depository 

25 institution and comply with the process reVerDate Sep 11 2014 18:47 Aug 26, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H7913.IH H7913

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1 quired under section 8(b) of the Federal De2 posit Insurance Act (12 U.S.C. 1818) with re3 spect to a cease and desist order.’’. 

4 (d) BALANCE SHEET TREATMENT OF LOANS.—Sec5 tion 4013 of the CARES Act (15 U.S.C. 9051), as amend6 ed by subsection (c), is further amended by adding at the 

7 end the following: 

8 ‘‘(f) BALANCE SHEET TREATMENT OF LOANS.—For 

9 purposes of a financial institution’s balance sheet, the fi10 nancial institution shall place all loans for which an elec11 tion has been made under subsection (b) into a separate 

12 account.’’. 

Æ 


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