FDIC Advisory Committee on 

Community Banking 

October 28, 2020 

Supervision Update 
FDIC 

 

 

 

Loan Modifications 

Joint Statement on Additional Loan Accommodations 

Related to COVID-19 

 Discusses risk management principles relevant to institutions 

that work with their borrowers as loans near the end of initial 

loan accommodation periods related to COVID-19 

 Applies to commercial and retail loan accommodations 

 Encourages institutions to work prudently with borrowers 

See FIL-74-2020, issued August 3, 2020 
FDIC 

 

 

 

 

 

Loan Modifications 

Interagency Statement on Loan Modifications by Financial Institutions 

Working with Customers Affected by the Coronavirus 

 Describes accounting and regulatory reporting for COVID-19 

related loan modifications, including subsequent modifications 

and the temporary relief provided by Section 4013 of the CARES 

Act 

 Provides supervisory views on past-due and nonaccrual 

regulatory reporting 

See FIL-74-2020, issued August 3, 2020 
Section 4013 of the CARES Act 

Evaluation date of whether borrower December 31, 2019 

was current (<30 days past due) 

Modification terms Any modification 

Time period of when the Between March 1, 2020, and the earlier of (i) December 

modification occurs 31, 2020, or (ii) the 60th day after the end of the COVID19 national emergency declared by the President. 

Duration of non-TDR designation Term of loan modification. Reevaluation for TDR 

designation is only required for subsequent 

modifications. 

Why is it not a TDR? By law, the institution is not required to designate the 

loan as a TDR. 

Non-Section 4013 Loan Modifications 

(lnteragency Statement) 

No earlier t han when t he modificat ion program is 

implemented 

Short term (e.g., six months) 

Management should use judgement t o determine 

if the modification is related to COVID-19. 

Term of loan modification. Reevaluation for TDR 

designation is only required for subsequent 

modifications. 

The institut ion may pres1ume that the borrower is 

not experiencing financial difficulty. 

FDIC 

 

 

 

Accounting for Loan Modifications 

If neither section 4013 of the CARES Act criteria nor the Interagency Statement considerations apply, 

the institution should follow existing accounting policies to determine whether the modification 

should be accounted for as a TDR. 
FDIC 

 

 

 

 

 

 

 

 

 

Loan Modifications 

Interagency Statement on Loan Modifications by Financial Institutions 

Working with Customers Affected by the Coronavirus 

 Past Due Reporting 

 Determined in accordance with the original contractual terms of a loan or the 

revised terms if the terms have changed as part of the modification 

 Past due status of a loan may be “frozen” during the modification period 

 Payments that were previously missed or would have been due during the 

modification period may be restructured and not contractually due until a later 

date 

 Nonaccrual Status 

 Nonaccrual assessment for a loan is unchanged by the law 

 Loan should be placed in nonaccrual status if full payment of principal or interest is 

not expected 

See FIL-74-2020, issued August 3, 2020 
FDIC 

 

 

 

 

 

 

 

 

Threshold Adjustments Due to Unusual Asset Growth 

Threshold Adjustments Due to Unusual Asset Growth 

 Institutions have experienced temporary increases in their total 

assets as a result of their participation in the Paycheck Protection 

Program (PPP) and the Paycheck Protection Program Liquidity 

Facility (PPPLF) and the effects of other stimulus activities. 

 The FDIC is evaluating regulatory thresholds in light of these 

balance sheet increases. 

See FIL-99-2020, issued October 20, 2020 
FDIC 

 

 

 

 

 

 

 

 

Regulatory Reporting Revisions Related to COVID-19 

Call Report Supplemental Instructions for September 30, 2020 

 Significant regulatory reporting revisions related to COVID-19 

were made to the June 30, 2020 Call Report. 

 Instructions for regulatory reporting revisions related to COVID19 are provided in the separate standalone, September 2020 

COVID-19 Related Supplemental Instructions. 

 These instructions update the June 2020 version of these 

Supplemental Instructions, as appropriate. 

See FIL-97-2020, issued October 14, 2020