The Federal Reserve Bank of New York vowed to continue to work closely with financial institutions to help take full advantage of the Community Reinvestment Act (CRA) interagency statement, which could help deliver much needed capital to Puerto Rico and the U.S. Virgin Islands to recover from last year’s hurricanes.
During the “Puerto Rico and U.S. Virgin Islands Philanthropic Efforts Information Session” held Wednesday, Jack Gutt, executive vice president of the Communications & Outreach Group at the New York Fed, said the agency will be working closely with regional leaders to “identify further opportunities for us to collaborate and support the work of the philanthropic community, especially as the region transitions toward medium- and long-term recovery.”
“We now have a critical opportunity to work together to ensure that Puerto Rico and the U.S. Virgin Islands have the support and resources to recover and rebound,” he said.
On Jan. 25, 2018, the Federal Reserve, in collaboration with the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency, issued an Interagency Statement regarding the consideration of bank activities in the USVI and Puerto Rico under the CRA following their designation as major disaster areas.
The statement allows that banks located anywhere in the country will receive consideration for community development activities that revitalize or stabilize the areas affected, as well as those that assist people displaced by the hurricanes.
“Today’s event is part of our ongoing efforts to support Puerto Rico and the USVI as they seek to recover from the devastating hurricanes of 2017 and set themselves on a sustainable economic path,” Gutt said.
“We firmly believe that philanthropic investments made in collaboration with community leaders, financial institutions and corporate partners can play an essential role in achieving those goals,” he added, referring to the New York Fed’s “long-term” commitment to the islands.
“For many years, but especially in the last decade as Puerto Rico fell into a long-term recession and subsequent fiscal crisis, the New York Fed has been closely monitoring the situation in the territories, developing research, hosting meetings, and providing technical support to other government agencies,” Gutt said.
The executive accompanied former New York Fed President Bill Dudley during a visit in March to Puerto Rico and the USVI, where he said he learned just “how great the needs are, not just for recovery but also to achieve the type of long-term economic health that we want for all of our citizens.”
“But, just like the needs and challenges are great, so too are the opportunities. We saw a fiercely proud and incredibly resilient population,” Gutt said. “We met with dedicated and innovative community development practitioners, educators, business leaders and entrepreneurs. We heard a common desire to seek a better path forward.”
The CRA could help deliver much needed capital to the islands, he concluded.