NR 98-77
July 24, 1998

     OCC Encourages National Banks to Work with Customers 
                 Affected By Drought in Texas 
                                
WASHINGTON, D.C. -- The Office of the Comptroller of the Currency
(OCC) has outlined measures to assist areas affected by the
drought in Texas.  The OCC regulates national banks.

The OCC recognizes that the effects of natural disasters on
individuals and businesses are often temporary, and that prudent
efforts to adjust or alter terms on existing loans in areas
affected by the disasters and related problems should not be
subject to bank examiner criticism. 

The OCC encourages national banks to consider various
alternatives that may include:

  extending the terms of loan repayments;

  restructuring a borrower's debt obligations; and,

  easing loan documentation or credit terms for new loans to
   certain borrowers, consistent with prudent banking practice.

The OCC notes that these measures could help borrowers recover
their financial strength and enable them to be in a better
position to repay their debts. These recovery efforts can
contribute to the health of the local community and the long-term
interests of the national bank.

 It is OCC policy for examiners not to criticize prudent efforts
by national banks to adjust or alter loan repayment terms or
extend new loans to borrowers affected by a natural disaster.

National banks in need of assistance in dealing with customers
affected by the drought should contact the OCC district office in
Dallas, Texas at (214) 720-0656.               

                              # # #
The OCC charters, regulates and examines approximately 2,600 national
 banks and 66 federal branches and agencies of foreign banks in the
 United States, accounting for 58 percent of the nation's banking
 assets.  Its mission is to ensure a safe, sound and competitive
 national banking system that supports the citizens, communities and
economy of the United States.