I 

116TH CONGRESS 

1ST SESSION H. R. 5322 

To establish or modify requirements relating to minority depository institutions, community development financial institutions, and impact banks, 

and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 5, 2019 

Mr. MEEKS (for himself, Mr. GREEN of Texas, Ms. TLAIB, Mr. CLEAVER, Mr. 

DAVID SCOTT of Georgia, Mr. CLAY, and Mrs. BEATTY) introduced the 

following bill; which was referred to the Committee on Financial Services, 

and in addition to the Committee on Small Business, for a period to be 

subsequently determined by the Speaker, in each case for consideration 

of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To establish or modify requirements relating to minority 

depository institutions, community development financial 

institutions, and impact banks, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Ensuring Diversity in Community Banking Act of 

6 2019’’. 


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1 (b) TABLE OF CONTENTS.—The table of contents for 

2 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Sense of Congress on funding the loan-loss reserve fund for small dollar 

loans. 

Sec. 3. Definitions. 

Sec. 4. Inclusion of women’s banks in the definition of minority depository institution. 

Sec. 5. Establishment of impact bank designation. 

Sec. 6. Minority Depository Institutions Advisory Committees. 

Sec. 7. Federal deposits in minority depository institutions. 

Sec. 8. Minority Bank Deposit Program. 

Sec. 9. Diversity report and best practices. 

Sec. 10. Investments in minority depository institutions and impact banks. 

Sec. 11. Requirement to mentor minority depository institutions or community 

development financial institutions to serve as a depositary or 

financial agent. 

Sec. 12. Custodial deposit program for covered minority depository institutions 

and impact banks. 

Sec. 13. Streamlined community development financial institution applications 

and reporting. 

Sec. 14. Task force on lending to small business concerns. 

3 SEC. 2. SENSE OF CONGRESS ON FUNDING THE LOAN-LOSS 

4 RESERVE FUND FOR SMALL DOLLAR LOANS. 

5 The sense of Congress is the following: 

6 (1) The Community Development Financial In7 stitutions Fund (the ‘‘CDFI Fund’’) is an agency of 

8 the Department of the Treasury, and was estab9 lished by the Riegle Community Development and 

10 Regulatory Improvement Act of 1994. The mission 

11 of the CDFI Fund is ‘‘to expand economic oppor12 tunity for underserved people and communities by 

13 supporting the growth and capacity of a national 

14 network of community development lenders, inves15 tors, and financial service providers’’. A community 

16 development financial institution (a ‘‘CDFI’’) is a 


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1 specialized financial institution serving low-income 

2 communities and a Community Development Entity 

3 (a ‘‘CDE’’) is a domestic corporation or partnership 

4 that is an intermediary vehicle for the provision of 

5 loans, investments, or financial counseling in low-in6 come communities. The CDFI Fund certifies CDFIs 

7 and CDEs. Becoming a certified CDFI or CDE al8 lows organizations to participate in various CDFI 

9 Fund programs as follows: 

10 (A) The Bank Enterprise Award Program, 

11 which provides FDIC-insured depository institu12 tions awards for a demonstrated increase in 

13 lending and investments in distressed commu14 nities and CDFIs. 

15 (B) The CDFI Program, which provides 

16 Financial and Technical Assistance awards to 

17 CDFIs to reinvest in the CDFI, and to build 

18 the capacity of the CDFI, including financing 

19 product development and loan loss reserves. 

20 (C) The Native American CDFI Assistance 

21 Program, which provides CDFIs and spon22 soring entities Financial and Technical Assist23 ance awards to increase lending and grow the 

24 number of CDFIs owned by Native Americans 

25 to help build capacity of such CDFIs. 


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1 (D) The New Market Tax Credit Program, 

2 which provides tax credits for making equity in3 vestments in CDEs that stimulate capital in4 vestments in low-income communities. 

5 (E) The Capital Magnet Fund, which pro6 vides awards to CDFIs and nonprofit affordable 

7 housing organizations to finance affordable 

8 housing solutions and related economic develop9 ment activities. 

10 (F) The Bond Guarantee Program, a 

11 source of long-term, patient capital for CDFIs 

12 to expand lending and investment capacity for 

13 community and economic development purposes. 

14 (2) The Department of the Treasury is author15 ized to create multi-year grant programs designed to 

16 encourage low-to-moderate income individuals to es17 tablish accounts at federally insured banks, and to 

18 improve low-to-moderate income individuals’ access 

19 to such accounts on reasonable terms. 

20 (3) Under this authority, grants to participants 

21 in CDFI Fund programs may be used for loan-loss 

22 reserves and to establish small-dollar loan programs 

23 by subsidizing related losses. These grants also allow 

24 for the providing recipients with the financial coun25 seling and education necessary to conduct transVerDate Sep 11 2014 21:49 Dec 06, 2019 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H5322.IH H5322

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1 actions and manage their accounts. These loans pro2 vide low-cost alternatives to payday loans and other 

3 nontraditional forms of financing that often impose 

4 excessive interest rates and fees on borrowers, and 

5 lead millions of Americans to fall into debt traps. 

6 Small-dollar loans can only be made pursuant to 

7 terms, conditions, and practices that are reasonable 

8 for the individual consumer obtaining the loan. 

9 (4) Program participation is restricted to eligi10 ble institutions, which are limited to organizations 

11 listed in section 501(c)(3) of the Internal Revenue 

12 Code and exempt from tax under 501(a) of such 

13 Code, federally insured depository institutions, com14 munity development financial institutions and State, 

15 local, or Tribal government entities. 

16 (5) Since its founding, the CDFI Fund has 

17 awarded over $3,300,000,000 to CDFIs and CDEs, 

18 allocated $54,000,000,000 in tax credits, and 

19 $1,510,000,000 in bond guarantees. According to 

20 the CDFI Fund, some programs attract as much as 

21 $10 in private capital for every $1 invested by the 

22 CDFI Fund. The Administration and the Congress 

23 should prioritize appropriation of funds for the loan 

24 loss reserve fund and technical assistance programs 

25 administered by the Community Development FinanVerDate Sep 11 2014 21:49 Dec 06, 2019 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H5322.IH H5322

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1 cial Institution Fund, as included in the version of 

2 the ‘‘Financial Services and General Government 

3 Appropriations Act, 2020’’ (H.R. 3351) that passed 

4 the House of Representatives on June, 26, 2019. 

5 SEC. 3. DEFINITIONS. 

6 In this Act: 

7 (1) COMMUNITY DEVELOPMENT FINANCIAL IN8 STITUTION.—The term ‘‘community development fi9 nancial institution’’ has the meaning given under 

10 section 103 of the Riegle Community Development 

11 and Regulatory Improvement Act of 1994 (12 

12 U.S.C. 4702). 

13 (2) MINORITY DEPOSITORY INSTITUTION.—The 

14 term ‘‘minority depository institution’’ has the 

15 meaning given under section 308 of the Financial 

16 Institutions Reform, Recovery, and Enforcement Act 

17 of 1989 (12 U.S.C. 1463 note), as amended by this 

18 Act. 

19 SEC. 4. INCLUSION OF WOMEN’S BANKS IN THE DEFINITION 

20 OF MINORITY DEPOSITORY INSTITUTION. 

21 Section 308(b)(1) of the Financial Institutions Re22 form, Recovery, and Enforcement Act of 1989 (12 U.S.C. 

23 1463 note) is amended— 

24 (1) by redesignating subparagraphs (A), (B), 

25 and (C) as clauses (i), (ii), and (iii), respectively; 


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1 (2) by striking ‘‘means any’’ and inserting the 

2 following: ‘‘means— 

3 ‘‘(A) any’’; and 

4 (3) in clause (iii) (as so redesignated), by strik5 ing the period at the end and inserting ‘‘; or’’; and 

6 (4) by inserting at the end the following new 

7 subparagraph: 

8 ‘‘(B) any bank described in clause (i), (ii), 

9 or (iii) of section 19(b)(1)(A) of the Federal 

10 Reserve Act— 

11 ‘‘(i) more than 50 percent of the out12 standing shares of which are held by 1 or 

13 more women; and 

14 ‘‘(ii) the majority of the directors on 

15 the board of directors of which are 

16 women.’’. 

17 SEC. 5. ESTABLISHMENT OF IMPACT BANK DESIGNATION. 

18 (a) IN GENERAL.—Each appropriate Federal bank19 ing agency shall establish a program under which a deposi20 tory institution with total consolidated assets of less than 

21 $10,000,000,000 may elect to be designated as an impact 

22 bank if 50 percent or more of the loans extended by such 

23 covered bank are extended to low-income borrowers. 

24 (b) DESIGNATION.—Based on data obtained through 

25 examinations, an appropriate Federal banking agency 


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1 shall submit a notification to a depository institution stat2 ing that the depository institution qualifies for designation 

3 as an impact bank. 

4 (c) APPLICATION.—A depository institution that does 

5 not receive a notification described in subsection (b) may 

6 submit an application to the appropriate Federal banking 

7 agency demonstrating that the depository institution 

8 qualifies for designation as an impact bank. 

9 (d) ADDITIONAL DATA OR OVERSIGHT.—A deposi10 tory institution is not required to submit additional data 

11 to an appropriate Federal banking agency or be subject 

12 to additional oversight from such an agency if such data 

13 or oversight is related specifically and solely for consider14 ation for a designation as an impact bank. 

15 (e) REMOVAL OF DESIGNATION.—If an appropriate 

16 Federal banking agency determines that a depository in17 stitution designated as an impact bank no longer meets 

18 the criteria for such designation, the appropriate Federal 

19 banking agency shall rescind the designation and notify 

20 the depository institution of such rescission. 

21 (f) RECONSIDERATION OF DESIGNATION; AP22 PEALS.—A depository institution may— 

23 (1) submit to the appropriate Federal banking 

24 agency a request to reconsider a determination that 


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1 such depository institution no longer meets the cri2 teria for the designation; or 

3 (2) file an appeal in accordance with procedures 

4 established by the appropriate Federal banking 

5 agency. 

6 (g) RULEMAKING.—Not later than 1 year after the 

7 date of the enactment of this Act, the appropriate Federal 

8 banking agencies shall jointly issue rules to carry out the 

9 requirements of this section, including by providing a defi10 nition of a low-income borrower. 

11 (h) FEDERAL DEPOSIT INSURANCE ACT DEFINI12 TIONS.—In this section, the terms ‘‘depository institution’’ 

13 and ‘‘appropriate Federal banking agency’’ have the 

14 meanings given such terms, respectively, in section 3 of 

15 the Federal Deposit Insurance Act (12 U.S.C. 1813). 

16 SEC. 6. MINORITY DEPOSITORY INSTITUTIONS ADVISORY 

17 COMMITTEES. 

18 (a) ESTABLISHMENT.—Each covered regulator shall 

19 establish an advisory committee to be called the ‘‘Minority 

20 Depository Institutions Advisory Committee’’. 

21 (b) DUTIES.—Each Minority Depository Institutions 

22 Advisory Committee shall provide advice to the respective 

23 covered regulator on meeting the goals established by sec24 tion 308 of the Financial Institutions Reform, Recovery, 

25 and Enforcement Act of 1989 (12 U.S.C. 1463 note) to 


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1 preserve the present number of covered minority institu2 tions, preserve the minority character of minority-owned 

3 institutions in cases involving mergers or acquisitions, pro4 vide technical assistance, and encourage the creation of 

5 new covered minority institutions. The scope of the work 

6 of each such Minority Depository Institutions Advisory 

7 Committee shall include an assessment of the current con8 dition of covered minority institutions, what regulatory 

9 changes or other steps the respective agencies may be able 

10 to take to fulfill the requirements of such section 308, and 

11 other issues of concern to minority depository institutions. 

12 (c) MEMBERSHIP.— 

13 (1) IN GENERAL.—Each Minority Depository 

14 Institutions Advisory Committee shall consist of no 

15 more than 10 members, who— 

16 (A) shall serve for one two-year term; 

17 (B) shall serve as a representative of a de18 pository institution or an insured credit union 

19 with respect to which the respective covered 

20 regulator is the covered regulator of such de21 pository institution or insured credit union; and 

22 (C) shall not receive pay by reason of their 

23 service on the advisory committee, but may re24 ceive travel or transportation expenses in acVerDate Sep 11 2014 21:49 Dec 06, 2019 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H5322.IH H5322

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1 cordance with section 5703 of title 5, United 

2 States Code. 

3 (2) DIVERSITY.—To the extent practicable, 

4 each covered regulator shall ensure that the mem5 bers of Minority Depository Institutions Advisory 

6 Committee of such agency reflect the diversity of de7 pository institutions. 

8 (d) MEETINGS.— 

9 (1) IN GENERAL.—Each Minority Depository 

10 Institutions Advisory Committee shall meet not less 

11 frequently than twice each year. 

12 (2) INVITATIONS.—Each Minority Depository 

13 Institutions Advisory Committee shall invite the at14 tendance at each meeting of the Minority Depository 

15 Institutions Advisory Committee of— 

16 (A) one member of the majority party and 

17 one member of the minority party of the Com18 mittee on Financial Services of the House of 

19 Representatives and the Committee on Bank20 ing, Housing, and Urban Affairs of the Senate; 

21 and 

22 (B) one member of the majority party and 

23 one member of the minority party of any rel24 evant subcommittees of such committees. 


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1 (e) NO TERMINATION OF ADVISORY COMMITTEES.— 

2 The termination requirements under section 14 of the 

3 Federal Advisory Committee Act (5 U.S.C. app.) shall not 

4 apply to a Minority Depository Institutions Advisory Com5 mittee established pursuant to this section. 

6 (f) DEFINITIONS.—In this section: 

7 (1) COVERED REGULATOR.—The term ‘‘covered 

8 regulator’’ means the Comptroller of the Currency, 

9 the Board of Governors of the Federal Reserve Sys10 tem, the Federal Deposit Insurance Corporation, 

11 and the National Credit Union Administration. 

12 (2) COVERED MINORITY INSTITUTION.—The 

13 term ‘‘covered minority institution’’ means a minor14 ity depository institution (as defined in section 

15 308(b) of the Financial Institutions Reform, Recov16 ery, and Enforcement Act of 1989 (12 U.S.C. 1463 

17 note)) or a minority credit union (as defined in sec18 tion 1204(c) of the Financial Institutions Reform, 

19 Recovery, and Enforcement Act of 1989, as amend20 ed by this Act). 

21 (3) DEPOSITORY INSTITUTION.—The term ‘‘de22 pository institution’’ has the meaning given under 

23 section 3 of the Federal Deposit Insurance Act (12 

24 U.S.C. 1813). 


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1 (4) INSURED CREDIT UNION.—The term ‘‘in2 sured credit union’’ has the meaning given in section 

3 101 of the Federal Credit Union Act (12 U.S.C. 

4 1752). 

5 (g) TECHNICAL AMENDMENT.—Section 308(b) of the 

6 Financial Institutions Reform, Recovery, and Enforce7 ment Act of 1989 (12 U.S.C. 1463 note) is amended by 

8 adding at the end the following new paragraph: 

9 ‘‘(3) DEPOSITORY INSTITUTION.—The term ‘de10 pository institution’ means an ‘insured depository in11 stitution’ (as defined in section 3 of the Federal De12 posit Insurance Act (12 U.S.C. 1813)) and an in13 sured credit union (as defined in section 101 of the 

14 Federal Credit Union Act (12 U.S.C. 1752)).’’. 

15 SEC. 7. FEDERAL DEPOSITS IN MINORITY DEPOSITORY IN16 STITUTIONS. 

17 (a) IN GENERAL.—Section 308 of the Financial In18 stitutions Reform, Recovery, and Enforcement Act of 

19 1989 (12 U.S.C. 1463 note) is amended— 

20 (1) by adding at the end the following new sub21 section: 

22 ‘‘(d) FEDERAL DEPOSITS.—The Secretary of the 

23 Treasury shall ensure that deposits made by Federal agen24 cies in minority depository institutions and impact banks 

25 are fully collateralized or fully insured, as determined by 


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1 the Secretary. Such deposits shall include reciprocal de2 posits as defined in section 337.6(e)(2)(v) of title 12, Code 

3 of Federal Regulations (as in effect on March 6, 2019).’’; 

4 and 

5 (2) in subsection (b), as amended by section 

6 6(g), by adding at the end the following new para7 graph: 

8 ‘‘(4) IMPACT BANK.—The term ‘impact bank’ 

9 means a depository institution designated by an ap10 propriate Federal banking agency pursuant to sec11 tion 5 of the Ensuring Diversity in Community 

12 Banking Act of 2019.’’. 

13 (b) TECHNICAL AMENDMENTS.—Section 308 of the 

14 Financial Institutions Reform, Recovery, and Enforce15 ment Act of 1989 (12 U.S.C. 1463 note) is amended— 

16 (1) in the matter preceding paragraph (1), by 

17 striking ‘‘section—’’ and inserting ‘‘section:’’; and 

18 (2) in the paragraph heading for paragraph (1), 

19 by striking ‘‘FINANCIAL’’ and inserting ‘‘DEPOSI20 TORY’’. 

21 SEC. 8. MINORITY BANK DEPOSIT PROGRAM. 

22 (a) IN GENERAL.—Section 1204 of the Financial In23 stitutions Reform, Recovery, and Enforcement Act of 

24 1989 (12 U.S.C. 1811 note) is amended to read as follows: 


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1 ‘‘SEC. 1204. EXPANSION OF USE OF MINORITY BANKS AND 

2 MINORITY CREDIT UNIONS. 

3 ‘‘(a) MINORITY BANK DEPOSIT PROGRAM.— 

4 ‘‘(1) ESTABLISHMENT.—There is established a 

5 program to be known as the ‘Minority Bank Deposit 

6 Program’ to expand the use of minority banks and 

7 minority credit unions. 

8 ‘‘(2) ADMINISTRATION.—The Secretary of the 

9 Treasury, acting through the Fiscal Service, shall— 

10 ‘‘(A) on application by a depository institu11 tion or credit union, certify whether such depos12 itory institution or credit union is a minority 

13 bank or minority credit union; 

14 ‘‘(B) maintain and publish a list of all de15 pository institutions and credit unions that have 

16 been certified pursuant to subparagraph (A); 

17 and 

18 ‘‘(C) periodically distribute the list de19 scribed in subparagraph (B) to— 

20 ‘‘(i) all Federal departments and 

21 agencies; 

22 ‘‘(ii) interested State and local govern23 ments; and 

24 ‘‘(iii) interested private sector compa25 nies. 


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1 ‘‘(3) INCLUSION OF CERTAIN ENTITIES ON

2 LIST.—A depository institution or credit union that, 

3 on the date of the enactment of this section, has a 

4 current certification from the Secretary of the 

5 Treasury stating that such depository institution or 

6 credit union is a minority bank or minority credit 

7 union shall be included on the list described under 

8 paragraph (2)(B). 

9 ‘‘(b) EXPANDED USE AMONG FEDERAL DEPART10 MENTS AND AGENCIES.— 

11 ‘‘(1) IN GENERAL.—Not later than 1 year after 

12 the establishment of the program described in sub13 section (a), the head of each Federal department or 

14 agency shall develop and implement standards and 

15 procedures to ensure, to the maximum extent pos16 sible as permitted by law, the use of minority banks 

17 and minority credit unions to serve the financial 

18 needs of each such department or agency. 

19 ‘‘(2) REPORT TO CONGRESS.—Not later than 2 

20 years after the establishment of the program de21 scribed in subsection (a), and annually thereafter, 

22 the head of each Federal department or agency shall 

23 submit to Congress a report on the actions taken to 

24 increase the use of minority banks and minority 


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1 credit unions to serve the financial needs of each 

2 such department or agency. 

3 ‘‘(c) DEFINITIONS.—For purposes of this section: 

4 ‘‘(1) CREDIT UNION.—The term ‘credit union’ 

5 has the meaning given the term ‘insured credit 

6 union’ in section 101 of the Federal Credit Union 

7 Act (12 U.S.C. 1752). 

8 ‘‘(2) DEPOSITORY INSTITUTION.—The term ‘de9 pository institution’ has the meaning given the term 

10 ‘insured depository institution’ in section 3 of the 

11 Federal Deposit Insurance Act (12 U.S.C. 1813). 

12 ‘‘(3) MINORITY.—The term ‘minority’ means 

13 any Black American, Native American, Hispanic 

14 American, or Asian American. 

15 ‘‘(4) MINORITY BANK.—The term ‘minority 

16 bank’ means a minority depository institution as de17 fined in section 308 of this Act. 

18 ‘‘(5) MINORITY CREDIT UNION.—The term ‘mi19 nority credit union’ means any credit union for 

20 which more than 50 percent of the membership (in21 cluding board members) of such credit union are mi22 nority individuals, as determined by the National 

23 Credit Union Administration pursuant to section 

24 308 of this Act.’’. 


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1 (b) CONFORMING AMENDMENTS.—The following pro2 visions are amended by striking ‘‘1204(c)(3)’’ and insert3 ing ‘‘1204(c)’’: 

4 (1) Section 808(b)(3) of the Community Rein5 vestment Act of 1977 (12 U.S.C. 2907(b)(3)). 

6 (2) Section 40(g)(1)(B) of the Federal Deposit 

7 Insurance Act (12 U.S.C. 1831q(g)(1)(B)). 

8 (3) Section 704B(h)(4) of the Equal Credit Op9 portunity Act (15 U.S.C. 1691c–2(h)(4)). 

10 SEC. 9. DIVERSITY REPORT AND BEST PRACTICES. 

11 (a) ANNUAL REPORT.—Each covered regulator shall 

12 submit to Congress an annual report on diversity includ13 ing the following: 

14 (1) Data, based on voluntary self-identification, 

15 on the racial, ethnic, and gender composition of the 

16 examiners of each covered regulator, disaggregated 

17 by length of time served as an examiner. 

18 (2) The status of any examiners of covered reg19 ulators, based on voluntary self-identification, as a 

20 veteran. 

21 (3) Whether any covered regulator, as of the 

22 date on which the report required under this section 

23 is submitted, has adopted a policy, plan, or strategy 

24 to promote racial, ethnic, and gender diversity 

25 among examiners of the covered regulator. 


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1 (4) Whether any special training is developed 

2 and provided for examiners related specifically to 

3 working with banks that serve communities that are 

4 predominantly minorities, low income, or rural, and 

5 the key focus of such training. 

6 (b) BEST PRACTICES.—Each Office of Minority and 

7 Women Inclusion of a covered regulator shall develop, pro8 vide to the head of the covered regulator, and make pub9 licly available best practices— 

10 (1) for increasing the diversity of candidates 

11 applying for examiner positions, including through 

12 outreach efforts to recruit diverse candidate to apply 

13 for entry-level examiner positions; and 

14 (2) for retaining and providing fair consider15 ation for promotions within the examiner staff for 

16 purposes of achieving diversity among examiners. 

17 (c) COVERED REGULATOR DEFINED.—In this sec18 tion, the term ‘‘covered regulator’’ means the Comptroller 

19 of the Currency, the Board of Governors of the Federal 

20 Reserve System, the Federal Deposit Insurance Corpora21 tion, and the National Credit Union Administration. 


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1 SEC. 10. INVESTMENTS IN MINORITY DEPOSITORY INSTITU2 TIONS AND IMPACT BANKS. 

3 (a) CONTROL FOR CERTAIN INSTITUTIONS.—Section 

4 7(j)(8)(B) of the Federal Deposit Insurance Act (12 

5 U.S.C. 1817(j)(8)(B)) is amended to read as follows: 

6 ‘‘(B) ‘control’ means the power, directly or indi7 rectly— 

8 ‘‘(i) to direct the management or policies 

9 of an insured depository institution; or 

10 ‘‘(ii)(I) with respect to an insured deposi11 tory institution, of a person to vote 25 per cen12 tum or more of any class of voting securities of 

13 such institution; or 

14 ‘‘(II) with respect to an insured depository 

15 institution that is an impact bank (as des16 ignated pursuant to section 5 of the Ensuring 

17 Diversity in Community Banking Act of 2019) 

18 or a minority depository institution (as defined 

19 in section 308(b) of the Financial Institutions 

20 Reform, Recovery, and Enforcement Act of 

21 1989), of an individual to vote 30 percent of 

22 more of any class of voting securities of such an 

23 impact bank or a minority depository institu24 tion.’’. 

25 (b) RULEMAKING.—The appropriate Federal banking 

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1 surance Act (12 U.S.C. 1813)) shall jointly issue rules for 

2 de novo minority depository institutions and de novo im3 pact banks (as designated pursuant to section 5) to allow 

4 3 years to meet the capital requirements otherwise appli5 cable to minority depository institutions and impact 

6 banks. 

7 (c) REPORT.—Not later than 1 year after the date 

8 of the enactment of this Act, the appropriate Federal 

9 banking agencies shall jointly submit to Congress a report 

10 on— 

11 (1) the principal causes for the low number of 

12 de novo minority depository institutions during the 

13 10-year period preceding the date of the report; 

14 (2) the main challenges to the creation of de 

15 novo minority depository institutions and de novo 

16 impact banks; and 

17 (3) regulatory and legislative considerations to 

18 promote the establishment of de novo minority de19 pository institutions and de novo impact banks. 

20 SEC. 11. REQUIREMENT TO MENTOR MINORITY DEPOSI21 TORY INSTITUTIONS OR COMMUNITY DEVEL22 OPMENT FINANCIAL INSTITUTIONS TO SERVE 

23 AS A DEPOSITARY OR FINANCIAL AGENT. 

24 (a) IN GENERAL.—Before a large financial institu25 tion may be employed as a financial agent of the DepartVerDate Sep 11 2014 21:49 Dec 06, 2019 Jkt 099200 PO 00000 Frm 00021 Fmt 6652 Sfmt 6201 E:\BILLS\H5322.IH H5322

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1 ment of the Treasury or perform any reasonable duties 

2 as depositary of public moneys of the Department of the 

3 Treasury, the large financial institution shall demonstrate 

4 participation as a mentor in a covered mentor-protege pro5 gram to a protege firm that is a minority depository insti6 tution or a community development financial institution. 

7 (b) REPORT.—Not later than 6 months after the date 

8 of the enactment of this Act and annually thereafter, the 

9 Secretary of the Treasury shall submit to Congress a re10 port on participants in a covered mentor-protege program, 

11 including an analysis of outcomes of such program. 

12 (c) PROCEDURES.—The Secretary of the Treasury 

13 shall publish procedures for compliance with the require14 ments of this section for large financial institutions. 

15 (d) DEFINITIONS.—In this section: 

16 (1) COVERED MENTOR-PROTEGE PROGRAM.— 

17 The term ‘‘covered mentor-protege program’’ means 

18 a mentor-protege program established by the Sec19 retary of the Treasury pursuant to section 45 of the 

20 Small Business Act (15 U.S.C. 657r). 

21 (2) LARGE FINANCIAL INSTITUTION.—The term 

22 ‘‘large financial institution’’ means any entity— 

23 (A) regulated by the Comptroller of the 

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1 surance Corporation, or the National Credit 

2 Union Administration; and 

3 (B) that has total consolidated assets 

4 greater than or equal to $50,000,000,000. 

5 SEC. 12. CUSTODIAL DEPOSIT PROGRAM FOR COVERED MI6 NORITY DEPOSITORY INSTITUTIONS AND IM7 PACT BANKS. 

8 (a) ESTABLISHMENT.—The Secretary of the Treas9 ury shall establish a custodial deposit program (in this sec10 tion referred to as the ‘‘Program’’) under which a covered 

11 bank shall receive monthly deposits from a qualifying ac12 count. 

13 (b) APPLICATION.—A covered bank shall submit to 

14 the Secretary an application to participate in the Program 

15 at such time, in such manner, and containing such infor16 mation as the Secretary may determine. 

17 (c) PROGRAM OPERATIONS.— 

18 (1) DESIGNATION OF CUSTODIAL ENTITIES.— 

19 The Secretary shall designate eligible custodial enti20 ties to make monthly deposits with covered banks se21 lected for participation in the Program on behalf of 

22 a qualifying account. 

23 (2) CUSTODIAL ACCOUNTS.— 

24 (A) IN GENERAL.—The Secretary shall es25 tablish a custodial deposit account for each 


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1 qualifying account with the eligible custodial en2 tity designated to make deposits with covered 

3 banks for each such qualifying account. 

4 (B) AMOUNT.—The Secretary shall deposit 

5 a total amount not greater than 5 percent of a 

6 qualifying account into any custodial deposit ac7 counts established under subparagraph (A). 

8 (C) DEPOSITS WITH PROGRAM PARTICI9 PANTS.— 

10 (i) MONTHLY DEPOSITS.—Each 

11 month, each eligible custodial entity des12 ignated by the Secretary shall deposit an 

13 amount not greater than the insured 

14 amount, in the aggregate, from each custo15 dial deposit account, in a single covered 

16 bank. 

17 (ii) LIMITATION.—With respect to the 

18 funds of an individual qualifying account, 

19 the eligible custodial entity may not de20 posit an amount greater than the insured 

21 amount in a single covered bank. 

22 (iii) INSURED AMOUNT DEFINED.—In 

23 this subparagraph, the term ‘‘insured 

24 amount’’ means the amount that is the 

25 greater of— 


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1 (I) the standard maximum de2 posit insurance amount (as defined in 

3 section 11(a)(1)(E) of the Federal 

4 Deposit Insurance Act (12 U.S.C. 

5 1821(a)(1)(E))); or 

6 (II) such higher amount nego7 tiated between the Secretary and the 

8 Corporation under which the Corpora9 tion will insure all deposits of such 

10 higher amount. 

11 (D) LIMITATIONS.—The total amount of 

12 funds deposited under the Program in a covered 

13 bank may not exceed the lesser of— 

14 (i) 10 percent of the average amount 

15 of deposits held by such covered bank in 

16 the previous quarter; or 

17 (ii) $100,000,000. 

18 (3) INTEREST.— 

19 (A) IN GENERAL.—Each eligible custodial 

20 entity designated by the Secretary shall— 

21 (i) collect interest from each covered 

22 bank in which such custodial entity depos23 its funds pursuant to paragraph (2); and 

24 (ii) disburse such interest to the Sec25 retary each month. 


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1 (B) INTEREST RATE.—The rate of any in2 terest collected under this paragraph may not 

3 exceed 50 percent of the discount window pri4 mary credit interest rate most recently pub5 lished on the Federal Reserve Statistical Re6 lease on selected interest rates (daily or week7 ly), commonly referred to as the H.15 release 

8 (commonly known as the ‘‘Federal funds rate’’). 

9 (4) STATEMENTS.—Each eligible custodial enti10 ty designated by the Secretary shall submit to the 

11 Secretary monthly statements that include the total 

12 amount of funds deposited with, and interest rate 

13 received from, each covered bank by the eligible cus14 todial entity on behalf of qualifying entities. 

15 (5) RECORDS.—The Secretary shall issue a 

16 quarterly report to Congress and make publicly 

17 available a record identifying all covered banks 

18 participatinig in the Program and amounts depos19 ited under the Program in covered banks. 

20 (d) REQUIREMENTS RELATING TO DEPOSITS.—De21 posits made with covered banks under this section may 

22 not— 

23 (1) be considered by the Corporation to be 

24 funds obtained, directly or indirectly, by or through 

25 any deposit broker for deposit into 1 or more deposit 


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1 accounts (as described under section 29 of the Fed2 eral Deposit Insurance Act (12 U.S.C. 1831f)); or 

3 (2) be subject to insurance fees from the Cor4 poration that are greater than insurance fees for 

5 typical demand deposits not obtained, directly or in6 directly, by or through any deposit broker (com7 monly known as ‘‘core deposits’’). 

8 (e) MODIFICATIONS.— 

9 (1) IN GENERAL.—The Secretary shall provide 

10 a 3-month period for public notice and comment be11 fore making any material change to the operation of 

12 the Program. 

13 (2) EXCEPTION.—The requirements of para14 graph (1) shall not apply if the Secretary makes a 

15 material change to the Program to comply with safe16 ty and soundness standards or other law. 

17 (f) TERMINATION.— 

18 (1) BY COVERED BANK.—A covered bank se19 lected for participation in the Program pursuant to 

20 subsection (c) may terminate participation in the 

21 Program by providing the Secretary a notification 

22 60 days prior to termination. 

23 (2) BY SECRETARY.—The Secretary may termi24 nate the participation of a covered bank in the Pro25 gram if the Secretary determines the covered bank— 


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1 (A) violated any terms of participation in 

2 the Program; 

3 (B) failed to comply with Federal bank se4 crecy laws, as documented in writing by the pri5 mary regulator of the covered bank; 

6 (C) failed to remain well capitalized; or 

7 (D) failed comply with safety and sound8 ness standards, as documented in writing by 

9 the primary regulator of the covered bank. 

10 (g) DEFINITIONS.—In this section: 

11 (1) CORPORATION.—The term ‘‘Corporation’’ 

12 means the Federal Deposit Insurance Corporation. 

13 (2) COVERED BANK.—The term ‘‘covered bank’’ 

14 means— 

15 (A) a minority depository institution that 

16 is regulated by the Corporation or the National 

17 Credit Union Administration that is well cap18 italized (as defined in section 38(b) of the Fed19 eral Deposit Insurance Act (12 U.S.C. 

20 1831o(b))); or 

21 (B) a depository institution designated 

22 pursuant to section 5 of the Ensuring Diversity 

23 in Community Banking Act of 2019 that is well 

24 capitalized (as defined in section 38(b) of the 


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1 Federal Deposit Insurance Act (12 U.S.C. 

2 1831o(b))). 

3 (3) ELIGIBLE CUSTODIAL ENTITY.—The term 

4 ‘‘eligible custodial entity’’ means— 

5 (A) an insured depository institution (as 

6 defined in section 3 of the Federal Deposit In7 surance Act (12 U.S.C. 1813)), 

8 (B) an insured credit union (as defined in 

9 section 101 of the Federal Credit Union Act 

10 (12 U.S.C. 1752)), or 

11 (C) or a well capitalized State-chartered 

12 trust company, 

13 designated by the Secretary under subsection (c)(1). 

14 (4) FEDERAL BANK SECRECY LAWS.—The term 

15 ‘‘Federal bank secrecy laws’’ means— 

16 (A) section 21 of the Federal Deposit In17 surance Act (12 U.S.C. 1829b); 

18 (B) section 123 of Public Law 91–508; 

19 and 

20 (C) subchapter II of chapter 53 of title 31, 

21 United States Code. 

22 (5) QUALIFYING ACCOUNT.—The term ‘‘quali23 fying account’’ means any account established in the 

24 Department of the Treasury that— 

25 (A) is controlled by the Secretary; and 


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1 (B) is expected to maintain a balance 

2 greater than $200,000,000 for the following 

3 calendar month. 

4 (6) SECRETARY.—The term ‘‘Secretary’’ means 

5 the Secretary of the Treasury. 

6 (7) WELL CAPITALIZED.—The term ‘‘well cap7 italized’’ has the meaning given in section 38 of the 

8 Federal Deposit Insurance Act (12 U.S.C. 1831o). 

9 SEC. 13. STREAMLINED COMMUNITY DEVELOPMENT FI10 NANCIAL INSTITUTION APPLICATIONS AND 

11 REPORTING. 

12 (a) APPLICATION PROCESSES.—Not later than 12 

13 months after the date of the enactment of this Act and 

14 with respect to any person having assets under 

15 $3,000,000,000 that submits an application for deposit in16 surance with the Federal Deposit Insurance Corporation 

17 that could also become a community development financial 

18 institution, the Federal Deposit Insurance Corporation, in 

19 consultation with the Administrator of the Community 

20 Development Financial Institutions Fund, shall— 

21 (1) develop systems and procedures to record 

22 necessary information to allow the Administrator to 

23 conduct preliminary analysis for such person to also 

24 become a community development financial institu25 tion; and 


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1 (2) develop procedures to streamline the appli2 cation and annual certification processes and to re3 duce costs for such person to become, and maintain 

4 certification as, a community development financial 

5 institution that serves low- and moderate-income 

6 neighborhoods (as defined under the Community Re7 investment Act of 1977 (12 U.S.C. 2901 et seq.)). 

8 (b) REPORT ON IMPLEMENTATION.—Not later than 

9 18 months after the date of the enactment of this Act, 

10 the Federal Deposit Insurance Corporation shall submit 

11 to Congress a report describing the systems and proce12 dures required under subsection (a). 

13 (c) ANNUAL REPORT.— 

14 (1) IN GENERAL.—Section 17(a)(1) of the Fed15 eral Deposit Insurance Act (12 U.S.C. 1827(a)(1)) 

16 is amended— 

17 (A) in subparagraph (E), by striking 

18 ‘‘and’’ at the end; 

19 (B) by redesignating subparagraph (F) as 

20 subparagraph (G); 

21 (C) by inserting after subparagraph (E) 

22 the following new subparagraph: 

23 ‘‘(F) applicants for deposit insurance that 

24 could also become a community development fi25 nancial institution (as defined in section 103 of 


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1 the Riegle Community Development and Regu2 latory Improvement Act of 1994), a minority 

3 depository institution (as defined in section 308 

4 of the Financial Institutions Reform, Recovery, 

5 and Enforcement Act of 1989), or an impact 

6 bank (as designated pursuant to section 5 of 

7 the Ensuring Diversity in Community Banking 

8 Act of 2019); and’’. 

9 (2) APPLICATION.—The amendment made by 

10 this subsection shall apply with respect to the first 

11 report to be submitted after the date that is 2 years 

12 after the date of the enactment of this Act. 

13 SEC. 14. TASK FORCE ON LENDING TO SMALL BUSINESS 

14 CONCERNS. 

15 (a) IN GENERAL.—Not later than 6 months after the 

16 date of the enactment of this Act, the Administrator of 

17 the Small Business Administration shall establish a task 

18 force to examine methods for improving relationships be19 tween the Small Business Administration and community 

20 development financial institutions, minority depository in21 stitutions, and Impact Banks to increase the volume of 

22 loans provided by such institutions to small business con23 cerns (as defined under section 3 of the Small Business 

24 Act (15 U.S.C. 632)). 


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1 (b) REPORT TO CONGRESS.—Not later than 18 

2 months after the establishment of the task force described 

3 in subsection (a), the Administrator of the Small Business 

4 Administration shall submit to Congress a report on the 

5 findings of such task force. 

Æ 


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