The Federal Reserve is looking toward a time-worn source to help with bailing out many smaller businesses and individuals as they enlist smaller regional and local banks for the job.
One such bank is New Jersey-based OceansFirst, with its 118-year-old history and assets numbering $10.2 billion in the small town of Toms River. On March 15, officials with OceansFirst spoke with the Fed and confirmed that they’d be assisting with the crisis by granting 90 days of relief to customers with both mortgage and business loans.
OceansFirst has been busy over the last week, sharing documents and templates for forbearance and others with banks as far away as Washington State. The bank had used these documents in the aftermath of Hurricane Sandy in 2012, which ravaged the east coast back then.
OceansFirst is just one example of the kinds of efforts that the Fed will be relying on from local banks as the coronavirus crisis continues to demolish the American economy. Loans may expand soon as Congress works out the kinks of various efforts moving through the U.S. legislative process, though that had not happened yet as of Tuesday, March 24. The Fed wants to buy various types of debt and is looking at plans to assist smaller businesses.
ANB Bank has billions of dollars in assets in Colorado, Wyoming and Kansas City, and chief executive Koger Propst said he’d already instructed workers to issue deferrals on loans for commercial, home and car properties for 3,700 customers.
Propst said he recognized that “the vast majority” of smaller businesses couldn’t survive with the kind of drastic change the virus has thrown roughly into place, so the bank had acted fast.
Chris Maher, chief executive of OceansFirst, said the tone of conversations with the Fed had been a remarkable contrast from the 2008 financial crash, because the crisis was not in any way caused by the banks — so OceansFirst simply wanted to help going forward in any way possible for the overall economy.