New York State Issues Regulatory Guidance on Governor Cuomo’s Executive Order Regarding 90 Day Bank Forbearances

DATE:            March 26, 2020

TO:                 Kane Kessler, P.C. Clients

FROM:           Kane Kessler, P.C. Corporate Department

RE:                  New York State Issues Regulatory Guidance on Governor Cuomo’s Executive Order
Regarding 90 Day Bank Forbearances

We refer to our prior memorandum to clients dated March 25, 2020 in which we described an Executive Order by Governor Cuomo that ordered banks to give 90 days of forbearance to individuals and business suffering financial hardship due to the COVID–19 crisis. The New York State Department of Financial Services (“DFS”) subsequently issued an emergency regulation relating to that Executive Order, which provides for specific forbearance only for individuals (related to residential mortgages, and certain ATM, overdraft and credit card fees). The DFS emergency regulation does not provide for any relief for businesses that have suffered financial hardship, which may be an indication that the Executive Order was only meant to provide relief to individuals. The situation remains unclear, but absent further guidance businesses should NOT rely on the Executive Order for relief from hardship related to the COVID-19 crisis.

There continue to be many interpretive questions regarding the scope of the Executive Order and the DFS regulation. We encourage you to consult with us before taking any action in reliance on the Executive Order or the DFS regulation. For additional information, please feel free to reach out to Robert Lawrence (at 212 519 5103, rlawrence@kanekessler.com), Steven Cohen (at 212 519 5115, scohen@kanekessler.com), Michael Wu (at 212 519 5165, mwu@kanekessler.com) or any partner in our Corporate Department.

This memo is provided for informational purposes only.

It is not intended as legal advice and readers should consult counsel to discuss how these matters relate to their individual circumstances