The Office of the Comptroller of the Currency (OCC) has approved an interim final rule (IFR) that will result in lower assessments for banks.
The move is an effort to provide temporary relief to banks that have been impacted by the COVID-19 pandemic.
Under the IFR, assessments that are due to be paid to the OCC by September 30, 2020 for national banks, federal savings associations, and federal branches and agencies of foreign banks will be calculated using data from December 31, 2019 for each institution, rather than June 30, 2020.
The change in calculating assessment fees will result in lower charges for most OCC-supervised banks, the regulator said.
However, the regulator added that if a bank’s assets as reported on June 30 were lower than on December 31, 2019, it would calculate the levy due based on the June 30 data to ensure that all banks paid the lower of the two options.
Acting Comptroller of the Currency Brian Brooks said that banks had played an important role in the national response to COVID-19.
“As a result, many banks took on significant volumes of additional assets while providing relief to their customers as part of these federal programs,” he said, referring to the Paycheck Protection Program (PPP) and the Main Street Lending Program.
“Banks should not be penalized by these efforts to support our national recovery. This interim final rule provides temporary relief against the adverse impact of COVID-19 on our nation’s banks that continue to be critical to our economic strength and recovery.”
The Federal Deposit Insurance Company has also temporarily amended its rules to remove PPP loans from its calculations for deposit insurance costs.
The US Small Business Administration reported that lenders had made 4.7 million PPP loans as of June 20, totaling $514.9 billion.
The data showed that lenders with under $10 billion in assets accounted for 44% of all the PPP loans made, or 2.3 million loans, while 19% were made by lenders with assets of $10 billion to $50 billion. Institutions with assets of more than $50bn made 37% of all PPP loans to June 20.
There were approximately $128 billion of funds still available under the program on June 20. The cut-off date for PPP applications is June 30.