‘‘(A) in the case of a microenterprise loan
by a regulated financial institution to a
microenterprise, the regulated financial institu-
tion; and
‘‘(B) in the case of a microenterprise loan
by 
a 
microenterprise 
intermediary 
to 
a
microenterprise, 
the 
microenterprise 
inter-
mediary.’’.
(b) CLERICAL AMENDMENT.—Section 804 of the
Community Reinvestment Act of 1977 (12 U.S.C. 2903)
is amended by inserting before subsection (a) (as so des-
ignated by subsection (a)(1) of this section) the following
new heading:
‘‘SEC. 804. ASSESSMENT OF RECORD OF MEETING COMMU-
NITY CREDIT NEEDS.’’.
SEC. 5. TREATMENT OF MICROENTERPRISE LOANS OF SAV-
INGS ASSOCIATIONS AS QUALIFIED THRIFT
INVESTMENTS.
(a) IN GENERAL.—Section 10(m)(4)(C)(ii) of the
Home Owners’ Loan Act (12 U.S.C. 1467a(m)(4)(C)(ii))
is amended by adding at the end the following new
subclause:
‘‘(VII) The aggregate amount of
microenterprise loans held by the sav-
ings association.’’.
(b) MICROENTERPRISE LOAN DEFINED.—Section
10(m)(4) of the Home Owners’ Loan Act (12 U.S.C.
1467a(m)(4)) is amended by adding at the end the follow-
ing new subparagraph:
‘‘(D) MICROENTERPRISE LOAN.—For pur-
poses 
of 
this 
paragraph, 
the 
term
‘microenterprise loan’—
‘‘(i) means a loan—
‘‘(I) to a commercial enterprise
with 5 or fewer employees, 1 or more
of whom own the enterprise;
‘‘(II) in amounts not less than
$100 and not more than $10,000; and
‘‘(III) the interest rate on which
is comparable to the interest rate
charged on secured commercial loans
offered by the savings association to
the association’s most preferred com-
mercial customers;
‘‘(IV) which is not secured by
collateral or is secured by collateral
the value of which, as a percentage of
the amount of the loan, is substan-
tially less than the percentage gen-
erally required by the institution for
commercial loans; and
‘‘(V) the terms of which may per-
mit the deferral of principal or inter-
est payments otherwise due under
such terms;
‘‘(ii) 
includes 
a 
loan 
to 
a
microenterprise intermediary the proceeds
of which will be used by the intermediary
for making loans described in clause (i);
and
‘‘(iii) does not include—
‘‘(I) 
any 
loan 
to 
a 
micro-
enterprise which does not meet the re-
quirements of paragraph (8); or
‘‘(II) any loan to a micro-
enterprise intermediary which does
not agree to use the proceeds of the
loan to make microenterprise loans in
accordance with the requirements of
paragraph (8).’’.
(c) CRITERIA FOR MICROENTERPRISE LOANS.—Sec-
tion 10(m) of the Home Owners’ Loan Act (12 U.S.C.
1467a(m)) is amended by adding at the end the following
new paragraph:
‘‘(8) 
CRITERIA
FOR
MICROENTERPRISE
LOANS.—
‘‘(A) IN
GENERAL.—A microenterprise
loan meets the requirements of this paragraph
only if the savings association makes the
microenterprise loan, or the microenterprise
intermediary which receives a loan from the as-
sociation, agrees to use the proceeds of the loan
to make microenterprise loans in accordance
with the following criteria:
‘‘(i) In considering any loan to a
microenterprise, the lender takes into ac-
count—
‘‘(I) the creditworthiness of any
person 
who 
controls 
the
microenterprise in lieu of the credit-
worthiness of the enterprise;
‘‘(II) 
in 
the 
case 
of 
a
microenterprise which is a startup
business, whether the microenterprise
is soundly conceived; and
‘‘(III) 
the 
need 
of 
the
microenterprise for expansion capital.
‘‘(ii) The lender accepts as collateral
for the loan a security interest in any per-
sonal property of any person who controls
the microenterprise which consists of
consumer or household goods.
‘‘(iii) The lender does not require col-
lateral or a secured interest for more than
50 percent of the face amount of the loan.
‘‘(iv) The loans are made in amounts
not less than $100 and not more than
$10,000 to persons who would not other-
wise qualify for a commercial loan.
‘‘(v) The lender provides technical as-
sistance, training, and counseling in busi-
ness practices, such as accounting, market-
ing, management, financial practices, and
general business practices and sales, to the
microenterprise in connection with the loan
and closely monitors the microenterprise,
including the enterprise’s loan repayment
performance.
‘‘(B) LENDER DEFINED.—For purposes of
subparagraph (A), the term ‘lender’ means—
‘‘(i) in the case of a microenterprise
loan by a savings association to a
microenterprise, the savings association;
and
‘‘(ii) in the case of a microenterprise
loan by a microenterprise intermediary to
a 
microenterprise, 
the 
microenterprise
intermediary.’’.
SEC. 6. USE OF CDBG ASSISTANCE FOR ADMINISTRATIVE
COSTS 
OF 
ENTITIES 
ASSISTING
MICROENTERPRISES.
Section 105(a)(23) of the Housing and Community
Development Act of 1974 (42 U.S.C. 5305(a)(23)) is
amended by adding at the end the following flush material:
‘‘assistance provided to such entities under this
paragraph may be used for reasonable administra-
tive and operating costs of such entities related to
facilitating economic development through activities
under subparagraphs (A) through (C);’’.
SEC. 7. ESTABLISHMENT OF MICROENTERPRISE DIVISION
IN EACH FEDERAL BANKING AGENCY.
(a) IN GENERAL.—Each Federal banking agency (as
defined in section 3(z) of the Federal Deposit Insurance
Act) shall establish a division to be known as the
‘‘Microenterprise Technical and Operations Office’’ to pro-
mote microenterprises by offering technical assistance,
training, outreach, and other support to groups and indi-
viduals 
engaged 
in, 
or 
desiring 
to 
establish, 
a
microenterprise or an institution which offers credit or fi-
nancial services to microenterprises.
(b) DUTIES OF MICROENTERPRISE DIVISION.—The
Microenterprise Technical and Operations Office of each
Federal banking agency shall—
(1) facilitate the creation and financing of
microenterprises by—
(A) collecting information relating to
microenterprises, including the ownership char-
acteristics of microenterprises and the perform-
ance of microenterprises by industry;
(B) providing such information without
charge to interested persons; and
(C) generally serving as a clearinghouse
for information relating to microenterprises;
and
(2) monitor and provide assistance to the
microenterprise divisions established pursuant to
section 34 of the Federal Deposit Insurance Act.
(c) MICROENTERPRISE DEFINED.—As used in this
section, the term ‘‘microenterprise’’ means any commer-
cial enterprise with 5 or fewer employees, 1 or more of
whom own the enterprise.
SEC. 8. STUDY.
(a) AVAILABILITY
OF CREDIT
FOR SMALL BUSI-
NESSES
WHICH
ARE
LARGER
THAN
MICROENTERPRISES.—The Financial Institutions Exam-
ination Council shall conduct a study before the end of
the 2-year period beginning on the date of the enactment
of this Act, based on the agency’s experience in admin-
istering the microenterprise loan provisions of this Act,
and the amendments made by this Act, on the best means
to make credit available for small businesses which—
(1) do not qualify for microenterprise loans or
need credit in larger amounts than is available
through microenterprise loans; and
(2) need credit in smaller amounts than is gen-
erally available from financial institutions or the
Small Business Administration.
(b) RECOMMENDATIONS AND REPORT.—The Finan-
cial Institutions Examination Council shall submit a re-
port to the Congress before the end of the 2-year period
referred to in subsection (a) containing the findings and
conclusions of the agency in connection with the study
conducted pursuant to subsection (a) and such rec-
ommendations for legislative and administrative action as
the agency may determine to be appropriate.
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