U.S. Office of the Comptroller of the Currency Addresses Federal Preemption of State and Local COVID-19 Actions

On June 17, 2020, the U.S. Office of the Comptroller of the Currency (the OCC) issued a bulletin reiterating that national banks, federal savings associations and federal branches and agencies of foreign banks (collectively, banks) are governed primarily by uniform federal standards.¹ The bulletin was issued in light of recent and anticipated actions by state and local governments to respond to the economic disruptions caused by the spread of COVID-19. The bulletin is likely intended for state and local governments as much as the banks to which it is addressed. In particular, the OCC notes that many state or local COVID-19 related actions address foreclosure and repossession moratoriums, loan forbearance and limitations on the interest and fees banks may charge. These actions may also require banks to report related information to state or local officials and include penalties for violations of these requirements. The OCC expresses concern that while well intentioned, the proliferation of competing requirements will hamper banks’ ability to operate effectively and efficiently, potentially increasing the risk to banks’ safety and soundness and ultimately harming consumers.

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