I 

118TH CONGRESS 

2D SESSION H. R. 7420 

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 

FEBRUARY 20, 2024 

Mr. MEEKS (for himself, Mr. GREEN of Texas, Mr. CLEAVER, Mrs. BEATTY, 

and Mr. DAVID SCOTT of Georgia) 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’’. 

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

7 this Act is as follows: 


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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 Depositories 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. Report on covered mentor-protege programs. 

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. 

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

2 RESERVE FUND FOR SMALL DOLLAR LOANS. 

3 The sense of Congress is the following: 

4 (1) The Community Development Financial In5 stitutions Fund (the ‘‘CDFI Fund’’) is an agency of 

6 the Department of the Treasury, and was estab7 lished by the Riegle Community Development and 

8 Regulatory Improvement Act of 1994. The mission 

9 of the CDFI Fund is ‘‘to expand economic oppor10 tunity for underserved people and communities by 

11 supporting the growth and capacity of a national 

12 network of community development lenders, inves13 tors, and financial service providers’’. A community 

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

15 specialized financial institution serving low-income 

16 communities and a Community Development Entity 

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


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1 that is an intermediary vehicle for the provision of 

2 loans, investments, or financial counseling in low-in3 come communities. The CDFI Fund certifies CDFIs 

4 and CDEs. Becoming a certified CDFI or CDE al5 lows organizations to participate in various CDFI 

6 Fund programs as follows: 

7 (A) The Bank Enterprise Award Program, 

8 which provides FDIC-insured depository institu9 tions awards for a demonstrated increase in 

10 lending and investments in distressed commu11 nities and CDFIs. 

12 (B) The CDFI Program, which provides 

13 Financial and Technical Assistance awards to 

14 CDFIs to reinvest in the CDFI, and to build 

15 the capacity of the CDFI, including financing 

16 product development and loan loss reserves. 

17 (C) The Native American CDFI Assistance 

18 Program, which provides CDFIs and spon19 soring entities Financial and Technical Assist20 ance awards to increase lending and grow the 

21 number of CDFIs owned by Native Americans 

22 to help build capacity of such CDFIs. 

23 (D) The New Market Tax Credit Program, 

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1 vestments in CDEs that stimulate capital in2 vestments in low-income communities. 

3 (E) The Capital Magnet Fund, which pro4 vides awards to CDFIs and nonprofit affordable 

5 housing organizations to finance affordable 

6 housing solutions and related economic develop7 ment activities. 

8 (F) The Bond Guarantee Program, a 

9 source of long-term, patient capital for CDFIs 

10 to expand lending and investment capacity for 

11 community and economic development purposes. 

12 (2) The Department of the Treasury is author13 ized to create multi-year grant programs designed to 

14 encourage low-to-moderate income individuals to es15 tablish accounts at federally insured banks, and to 

16 improve low-to-moderate income individuals’ access 

17 to such accounts on reasonable terms. 

18 (3) Under this authority, grants to participants 

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

20 reserves and to establish small-dollar loan programs 

21 by subsidizing related losses. These grants also allow 

22 for the providing recipients with the financial coun23 seling and education necessary to conduct trans24 actions and manage their accounts. These loans pro25 vide low-cost alternatives to payday loans and other 


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1 nontraditional forms of financing that often impose 

2 excessive interest rates and fees on borrowers, and 

3 lead millions of Americans to fall into debt traps. 

4 Small-dollar loans can only be made pursuant to 

5 terms, conditions, and practices that are reasonable 

6 for the individual consumer obtaining the loan. 

7 (4) Program participation is restricted to eligi8 ble institutions, which are limited to organizations 

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

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

11 Code, federally insured depository institutions, com12 munity development financial institutions and State, 

13 local, or Tribal government entities. 

14 (5) According to the CDFI Fund, some pro15 grams attract as much as $10 in private capital for 

16 every $1 invested by the CDFI Fund. The Adminis17 tration and the Congress should prioritize appropria18 tion of funds for the loan loss reserve fund and tech19 nical assistance programs administered by the Com20 munity Development Financial Institution Fund. 

21 SEC. 3. DEFINITIONS. 

22 In this Act: 

23 (1) COMMUNITY DEVELOPMENT FINANCIAL IN24 STITUTION.—The term ‘‘community development fi25 nancial institution’’ has the meaning given under 


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1 section 103 of the Riegle Community Development 

2 and Regulatory Improvement Act of 1994 (12 

3 U.S.C. 4702). 

4 (2) MINORITY DEPOSITORY INSTITUTION.—The 

5 term ‘‘minority depository institution’’ has the 

6 meaning given under section 308 of the Financial 

7 Institutions Reform, Recovery, and Enforcement Act 

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

9 Act. 

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

11 OF MINORITY DEPOSITORY INSTITUTION. 

12 Section 308(b)(1) of the Financial Institutions Re13 form, Recovery, and Enforcement Act of 1989 (12 U.S.C. 

14 1463 note) is amended— 

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

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

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

18 following: ‘‘means— 

19 ‘‘(A) any’’; 

20 (3) in clause (iii) (as so redesignated), by strik21 ing the period at the end and inserting ‘‘; or’’; and 

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

23 subparagraph: 


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

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

3 Reserve Act— 

4 ‘‘(i) more than 50 percent of the out5 standing shares of which are held by 1 or 

6 more women; and 

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

8 the board of directors of which are 

9 women.’’. 

10 SEC. 5. ESTABLISHMENT OF IMPACT BANK DESIGNATION. 

11 (a) IN GENERAL.—Each Federal banking agency 

12 shall establish a program under which a depository institu13 tion with total consolidated assets of less than 

14 $10,000,000,000 may elect to be designated as an impact 

15 bank if the total dollar value of the loans extended by such 

16 depository institution to low-income borrowers is greater 

17 than or equal to 50 percent of the assets of such bank. 

18 (b) NOTIFICATION OF ELIGIBILITY.—Based on data 

19 obtained through examinations of depository institutions, 

20 the appropriate Federal banking agency shall notify a de21 pository institution if the institution is eligible to be des22 ignated as an impact bank. 

23 (c) APPLICATION.—Regardless of whether or not it 

24 has received a notice of eligibility under subsection (b), 


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1 a depository institution may submit an application to the 

2 appropriate Federal banking agency— 

3 (1) requesting to be designated as an impact 

4 bank; and 

5 (2) demonstrating that the depository institu6 tion meets the applicable qualifications. 

7 (d) LIMITATION ON ADDITIONAL DATA REQUIRE8 MENTS.—The Federal banking agencies may only impose 

9 additional data collection requirements on a depository in10 stitution under this section if such data is— 

11 (1) necessary to process an application sub12 mitted by the depository institution to be designated 

13 an impact bank; or 

14 (2) with respect to a depository institution that 

15 is designated as an impact bank, necessary to ensure 

16 the depository institution’s ongoing qualifications to 

17 maintain such designation. 

18 (e) REMOVAL OF DESIGNATION.—If the appropriate 

19 Federal banking agency determines that a depository in20 stitution designated as an impact bank no longer meets 

21 the criteria for such designation, the appropriate Federal 

22 banking agency shall rescind the designation and notify 

23 the depository institution of such rescission. 


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1 (f) RECONSIDERATION OF DESIGNATION; AP2 PEALS.—Under such procedures as the Federal banking 

3 agencies may establish, a depository institution may— 

4 (1) submit to the appropriate Federal banking 

5 agency a request to reconsider a determination that 

6 such depository institution no longer meets the cri7 teria for the designation; or 

8 (2) file an appeal of such determination. 

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

10 date of the enactment of this Act, the Federal banking 

11 agencies shall jointly issue rules to carry out the require12 ments of this section, including by providing a definition 

13 of a low-income borrower. 

14 (h) REPORTS.—Each Federal banking agency shall 

15 submit an annual report to the Congress containing a de16 scription of actions taken to carry out this section. 

17 (i) FEDERAL DEPOSIT INSURANCE ACT DEFINI18 TIONS.—In this section, the terms ‘‘depository institu19 tion’’, ‘‘appropriate Federal banking agency’’, and ‘‘Fed20 eral banking agency’’ have the meanings given such terms, 

21 respectively, in section 3 of the Federal Deposit Insurance 

22 Act (12 U.S.C. 1813). 


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1 SEC. 6. MINORITY DEPOSITORIES ADVISORY COMMITTEES. 

2 (a) ESTABLISHMENT.—Each covered regulator shall 

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

4 Depositories Advisory Committee’’. 

5 (b) DUTIES.—Each Minority Depositories Advisory 

6 Committee shall provide advice to the respective covered 

7 regulator on meeting the goals established by section 308 

8 of the Financial Institutions Reform, Recovery, and En9 forcement Act of 1989 (12 U.S.C. 1463 note) to preserve 

10 the present number of covered minority institutions, pre11 serve the minority character of minority-owned institu12 tions in cases involving mergers or acquisitions, provide 

13 technical assistance, and encourage the creation of new 

14 covered minority institutions. The scope of the work of 

15 each such Minority Depositories Advisory Committee shall 

16 include an assessment of the current condition of covered 

17 minority institutions, what regulatory changes or other 

18 steps the respective agencies may be able to take to fulfill 

19 the requirements of such section 308, and other issues of 

20 concern to covered minority institutions. 

21 (c) MEMBERSHIP.— 

22 (1) IN GENERAL.—Each Minority Depositories 

23 Advisory Committee shall consist of no more than 

24 10 members, who— 

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


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1 (B) shall serve as a representative of a de2 pository institution or an insured credit union 

3 with respect to which the respective covered 

4 regulator is the covered regulator of such de5 pository institution or insured credit union; and 

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

7 service on the advisory committee, but may re8 ceive travel or transportation expenses in ac9 cordance with section 5703 of title 5, United 

10 States Code. 

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

12 each covered regulator shall ensure that the mem13 bers of the Minority Depositories Advisory Com14 mittee of such agency reflect the diversity of covered 

15 minority institutions. 

16 (d) MEETINGS.— 

17 (1) IN GENERAL.—Each Minority Depositories 

18 Advisory Committee shall meet not less frequently 

19 than twice each year. 

20 (2) NOTICE AND INVITATIONS.—Each Minority 

21 Depositories Advisory Committee shall— 

22 (A) notify the Committee on Financial 

23 Services of the House of Representatives and 

24 the Committee on Banking, Housing, and 

25 Urban Affairs of the Senate in advance of each 


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1 meeting of the Minority Depositories Advisory 

2 Committee; and 

3 (B) invite the attendance at each meeting 

4 of the Minority Depositories Advisory Com5 mittee of— 

6 (i) one member of the majority party 

7 and one member of the minority party of 

8 the Committee on Financial Services of the 

9 House of Representatives and the Com10 mittee on Banking, Housing, and Urban 

11 Affairs of the Senate; and 

12 (ii) one member of the majority party 

13 and one member of the minority party of 

14 any relevant subcommittees of such com15 mittees. 

16 (e) NO TERMINATION OF ADVISORY COMMITTEES.— 

17 The termination requirements under section 14 of the 

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

19 apply to a Minority Depositories Advisory Committee es20 tablished pursuant to this section. 

21 (f) DEFINITIONS.—In this section: 

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

23 regulator’’ means the Comptroller of the Currency, 

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1 tem, the Federal Deposit Insurance Corporation, 

2 and the National Credit Union Administration. 

3 (2) COVERED MINORITY INSTITUTION.—The 

4 term ‘‘covered minority institution’’ means a minor5 ity depository institution (as defined in section 

6 308(b) of the Financial Institutions Reform, Recov7 ery, and Enforcement Act of 1989 (12 U.S.C. 1463 

8 note)). 

9 (3) DEPOSITORY INSTITUTION.—The term ‘‘de10 pository institution’’ has the meaning given under 

11 section 3 of the Federal Deposit Insurance Act (12 

12 U.S.C. 1813). 

13 (4) INSURED CREDIT UNION.—The term ‘‘in14 sured credit union’’ has the meaning given in section 

15 101 of the Federal Credit Union Act (12 U.S.C. 

16 1752). 

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

18 Financial Institutions Reform, Recovery, and Enforce19 ment Act of 1989 (12 U.S.C. 1463 note) is amended by 

20 adding at the end the following new paragraph: 

21 ‘‘(3) DEPOSITORY INSTITUTION.—The term ‘de22 pository institution’ means an ‘insured depository in23 stitution’ (as defined in section 3 of the Federal De24 posit Insurance Act (12 U.S.C. 1813)) and an inVerDate Sep 11 2014 04:32 Feb 27, 2024 Jkt 049200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\H7420.IH H7420

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1 sured credit union (as defined in section 101 of the 

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

3 SEC. 7. FEDERAL DEPOSITS IN MINORITY DEPOSITORY IN4 STITUTIONS. 

5 (a) IN GENERAL.—Section 308 of the Financial In6 stitutions Reform, Recovery, and Enforcement Act of 

7 1989 (12 U.S.C. 1463 note) is amended— 

8 (1) by adding at the end the following new sub9 section: 

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

11 Treasury shall ensure that deposits made by Federal agen12 cies in minority depository institutions and impact banks 

13 are collateralized or insured, as determined by the Sec14 retary. Such deposits shall include reciprocal deposits as 

15 defined in section 337.6(e)(2)(v) of title 12, Code of Fed16 eral Regulations (as in effect on March 6, 2019).’’; and 

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

18 6(g), by adding at the end the following new para19 graph: 

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

21 means a depository institution designated by the ap22 propriate Federal banking agency pursuant to sec23 tion 5 of the Ensuring Diversity in Community 

24 Banking Act.’’. 


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1 (b) TECHNICAL AMENDMENTS.—Section 308(b) of 

2 the Financial Institutions Reform, Recovery, and Enforce3 ment Act of 1989 (12 U.S.C. 1463 note) is amended— 

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

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

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

7 by striking ‘‘FINANCIAL’’ and inserting ‘‘DEPOSI8 TORY’’. 

9 SEC. 8. MINORITY BANK DEPOSIT PROGRAM. 

10 (a) IN GENERAL.—Section 1204 of the Financial In11 stitutions Reform, Recovery, and Enforcement Act of 

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

13 ‘‘SEC. 1204. EXPANSION OF USE OF MINORITY DEPOSITORY 

14 INSTITUTIONS. 

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

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

17 program to be known as the ‘Minority Bank Deposit 

18 Program’ to expand the use of minority depository 

19 institutions. 

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

21 Treasury, acting through the Fiscal Service, shall— 

22 ‘‘(A) on application by a depository institu23 tion or credit union, certify whether such depos24 itory institution or credit union is a minority 

25 depository institution; 


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1 ‘‘(B) maintain and publish a list of all de2 pository institutions and credit unions that have 

3 been certified pursuant to subparagraph (A); 

4 and 

5 ‘‘(C) periodically distribute the list de6 scribed in subparagraph (B) to— 

7 ‘‘(i) all Federal departments and 

8 agencies; 

9 ‘‘(ii) interested State and local govern10 ments; and 

11 ‘‘(iii) interested private sector compa12 nies. 

13 ‘‘(3) INCLUSION OF CERTAIN ENTITIES ON

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

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

16 current certification from the Secretary of the 

17 Treasury stating that such depository institution or 

18 credit union is a minority depository institution shall 

19 be included on the list described under paragraph 

20 (2)(B). 

21 ‘‘(b) EXPANDED USE AMONG FEDERAL DEPART22 MENTS AND AGENCIES.— 

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

24 the establishment of the program described in sub25 section (a), the head of each Federal department or 


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1 agency shall develop and implement standards and 

2 procedures to prioritize, to the maximum extent pos3 sible as permitted by law and consistent with prin4 ciples of sound financial management, the use of mi5 nority depository institutions to hold the deposits of 

6 each such department or agency. 

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

8 years after the establishment of the program de9 scribed in subsection (a), and annually thereafter, 

10 the head of each Federal department or agency shall 

11 submit to Congress a report on the actions taken to 

12 increase the use of minority depository institutions 

13 to hold the deposits of each such department or 

14 agency. 

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

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

17 has the meaning given the term ‘insured credit 

18 union’ in section 101 of the Federal Credit Union 

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

20 ‘‘(2) DEPOSITORY INSTITUTION.—The term ‘de21 pository institution’ has the meaning given in section 

22 3 of the Federal Deposit Insurance Act (12 U.S.C. 

23 1813). 

24 ‘‘(3) MINORITY DEPOSITORY INSTITUTION.— 

25 The term ‘minority depository institution’ has the 


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1 meaning given that term under section 308 of this 

2 Act.’’. 

3 (b) CONFORMING AMENDMENTS.—The following pro4 visions are amended by striking ‘‘1204(c)(3)’’ and insert5 ing ‘‘1204(c)’’: 

6 (1) Section 808(b)(3) of the Community Rein7 vestment Act of 1977 (12 U.S.C. 2907(b)(3)). 

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

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

10 (3) Section 704B(h)(4) of the Equal Credit Op11 portunity Act (15 U.S.C. 1691c–2(h)(4)). 

12 SEC. 9. DIVERSITY REPORT AND BEST PRACTICES. 

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

14 submit to Congress an annual report on diversity includ15 ing the following: 

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

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

18 examiners of each covered regulator, disaggregated 

19 by length of time served as an examiner. 

20 (2) The status of any examiners of covered reg21 ulators, based on voluntary self-identification, as a 

22 veteran. 

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

24 date on which the report required under this section 

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


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1 to promote racial, ethnic, and gender diversity 

2 among examiners of the covered regulator. 

3 (4) Whether any special training is developed 

4 and provided for examiners related specifically to 

5 working with depository institutions and credit 

6 unions that serve communities that are predomi7 nantly minorities, low income, or rural, and the key 

8 focus of such training. 

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

10 Women Inclusion of a covered regulator shall develop, pro11 vide to the head of the covered regulator, and make pub12 licly available best practices— 

13 (1) for increasing the diversity of candidates 

14 applying for examiner positions, including through 

15 outreach efforts to recruit diverse candidate to apply 

16 for entry-level examiner positions; and 

17 (2) for retaining and providing fair consider18 ation for promotions within the examiner staff for 

19 purposes of achieving diversity among examiners. 

20 (c) COVERED REGULATOR DEFINED.—In this sec21 tion, the term ‘‘covered regulator’’ means the Comptroller 

22 of the Currency, the Board of Governors of the Federal 

23 Reserve System, the Federal Deposit Insurance Corpora24 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) or a mi18 nority depository institution (as defined in sec19 tion 308(b) of the Financial Institutions Re20 form, Recovery, and Enforcement Act of 1989), 

21 of an individual to vote 30 percent or more of 

22 any class of voting securities of such an impact 

23 bank or a minority depository institution.’’. 

24 (b) RULEMAKING.—The Federal banking agencies 

25 (as defined in section 3 of the Federal Deposit Insurance 

26 Act (12 U.S.C. 1813)) shall jointly issue rules for de novo 


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1 minority depository institutions and de novo impact banks 

2 (as designated pursuant to section 5) to allow 3 years to 

3 meet the capital requirements otherwise applicable to mi4 nority depository institutions and impact banks. 

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

6 of the enactment of this Act, the Federal banking agencies 

7 shall jointly submit to Congress a report on— 

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

9 de novo minority depository institutions during the 

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

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

12 novo minority depository institutions and de novo 

13 impact banks; and 

14 (3) regulatory and legislative considerations to 

15 promote the establishment of de novo minority de16 pository institutions and de novo impact banks. 

17 SEC. 11. REPORT ON COVERED MENTOR-PROTEGE PRO18 GRAMS. 

19 (a) REPORT.—Not later than 6 months after the date 

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

21 Secretary of the Treasury shall submit to Congress a re22 port on participants in a covered mentor-protege program, 

23 including— 

24 (1) an analysis of outcomes of such program; 


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1 (2) the number of minority depository institu2 tions that are eligible to participate in such program 

3 but do not have large financial institution mentors; 

4 and 

5 (3) recommendations for how to match such mi6 nority depository institutions with large financial in7 stitution mentors. 

8 (b) DEFINITIONS.—In this section: 

9 (1) COVERED MENTOR-PROTEGE PROGRAM.— 

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

11 a mentor-protege program established by the Sec12 retary of the Treasury pursuant to section 45 of the 

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

14 (2) LARGE FINANCIAL INSTITUTION.—The term 

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

16 (A) regulated by the Comptroller of the 

17 Currency, the Board of Governors of the Fed18 eral Reserve System, the Federal Deposit In19 surance Corporation, or the National Credit 

20 Union Administration; and 

21 (B) that has total consolidated assets 

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


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1 SEC. 12. CUSTODIAL DEPOSIT PROGRAM FOR COVERED MI2 NORITY DEPOSITORY INSTITUTIONS AND IM3 PACT BANKS. 

4 (a) IN GENERAL.—Not later than one year after the 

5 date of the enactment of this Act, the Secretary of the 

6 Treasury shall issue rules establishing a custodial deposit 

7 program under which a covered bank may receive deposits 

8 from a qualifying account. 

9 (b) REQUIREMENTS.—In issuing rules under sub10 section (a), the Secretary of the Treasury shall— 

11 (1) consult with the Federal banking agencies; 

12 (2) ensure each covered bank participating in 

13 the program established under this section— 

14 (A) has appropriate policies relating to 

15 management of assets, including measures to 

16 ensure the safety and soundness of each such 

17 covered bank; and 

18 (B) is compliant with applicable law; and 

19 (3) ensure, to the extent practicable that the 

20 rules do not conflict with goals described in section 

21 308(a) of the Financial Institutions Reform, Recov22 ery, and Enforcement Act of 1989 (12 U.S.C. 1463 

23 note). 

24 (c) LIMITATIONS.— 

25 (1) DEPOSITS.—With respect to the funds of an 

26 individual qualifying account, an entity may not deVerDate Sep 11 2014 04:32 Feb 27, 2024 Jkt 049200 PO 00000 Frm 00023 Fmt 6652 Sfmt 6201 E:\BILLS\H7420.IH H7420

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1 posit an amount greater than the insured amount in 

2 a single covered bank. 

3 (2) TOTAL DEPOSITS.—The total amount of 

4 funds deposited in a covered bank under the custo5 dial deposit program described under this section 

6 may not exceed the lesser of— 

7 (A) 10 percent of the average amount of 

8 deposits held by such covered bank in the pre9 vious quarter; or 

10 (B) $100,000,000 (as adjusted for infla11 tion). 

12 (d) REPORT.—Each quarter, the Secretary of the 

13 Treasury shall submit to Congress a report on the imple14 mentation of the program established under this section 

15 including information identifying participating covered 

16 banks and the total amount of deposits received by covered 

17 banks under the program. 

18 (e) DEFINITIONS.—In this section: 

19 (1) COVERED BANK.—The term ‘‘covered bank’’ 

20 means— 

21 (A) a minority depository institution that 

22 is well capitalized, as defined by the appropriate 

23 Federal banking agency; or 

24 (B) a depository institution designated 

25 pursuant to section 5 of the Ensuring Diversity 


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1 in Community Banking Act that is well capital2 ized, as defined by the appropriate Federal 

3 banking agency. 

4 (2) INSURED AMOUNT.—The term ‘‘insured 

5 amount’’ means the amount that is the greater of— 

6 (A) the standard maximum deposit insur7 ance amount (as defined in section 11(a)(1)(E) 

8 of the Federal Deposit Insurance Act (12 

9 U.S.C. 1821(a)(1)(E))); or 

10 (B) such higher amount negotiated be11 tween the Secretary of the Treasury and the 

12 Federal Deposit Insurance Corporation under 

13 which the Corporation will insure all deposits of 

14 such higher amount. 

15 (3) FEDERAL BANKING AGENCIES.—The terms 

16 ‘‘appropriate Federal banking agency’’ and ‘‘Federal 

17 banking agencies’’ have the meaning given those 

18 terms, respectively, under section 3 of the Federal 

19 Deposit Insurance Act. 

20 (4) QUALIFYING ACCOUNT.—The term ‘‘quali21 fying account’’ means any account established in the 

22 Department of the Treasury that— 

23 (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 24- 

3 month period. 

4 SEC. 13. STREAMLINED COMMUNITY DEVELOPMENT FI5 NANCIAL INSTITUTION APPLICATIONS AND 

6 REPORTING. 

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

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

9 with respect to any person having assets under 

10 $3,000,000,000 that submits an application for deposit in11 surance with the Federal Deposit Insurance Corporation 

12 that could also become a community development financial 

13 institution, the Federal Deposit Insurance Corporation, in 

14 consultation with the Administrator of the Community 

15 Development Financial Institutions Fund, shall— 

16 (1) develop systems and procedures to record 

17 necessary information to allow the Administrator to 

18 conduct preliminary analysis for such person to also 

19 become a community development financial institu20 tion; and 

21 (2) develop procedures to streamline the appli22 cation and annual certification processes and to re23 duce costs for such person to become, and maintain 

24 certification as, a community development financial 

25 institution. 


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1 (b) IMPLEMENTATION REPORT.—Not later than 18 

2 months after the date of the enactment of this Act, the 

3 Federal Deposit Insurance Corporation shall submit to 

4 Congress a report describing the systems and procedures 

5 required under subsection (a). 

6 (c) ANNUAL REPORT.— 

7 (1) IN GENERAL.—Section 17(a)(1) of the Fed8 eral Deposit Insurance Act (12 U.S.C. 1827(a)(1)) 

9 is amended— 

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

11 ‘‘and’’ at the end; 

12 (B) by redesignating subparagraph (F) as 

13 subparagraph (G); and 

14 (C) by inserting after subparagraph (E) 

15 the following new subparagraph: 

16 ‘‘(F) applicants for deposit insurance that 

17 could also become a community development fi18 nancial institution (as defined in section 103 of 

19 the Riegle Community Development and Regu20 latory Improvement Act of 1994), a minority 

21 depository institution (as defined in section 308 

22 of the Financial Institutions Reform, Recovery, 

23 and Enforcement Act of 1989), or an impact 

24 bank (as designated pursuant to section 5 of 


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1 the Ensuring Diversity in Community Banking 

2 Act); and’’. 

3 (2) APPLICATION.—The amendment made by 

4 this subsection shall apply with respect to the first 

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

6 after the date of the enactment of this Act. 

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

8 CONCERNS. 

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

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

11 the Small Business Administration shall establish a task 

12 force to examine methods for improving relationships be13 tween the Small Business Administration and community 

14 development financial institutions, minority depository in15 stitutions, and impact banks (as designated pursuant to 

16 section 5) to increase the volume of loans provided by such 

17 institutions to small business concerns (as defined under 

18 section 3 of the Small Business Act (15 U.S.C. 632)). 

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

20 months after the establishment of the task force described 

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

22 Administration shall submit to Congress a report on the 

23 findings of such task force. 

Æ 


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