SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Ensuring Diversity in Community Banking Act’’. 
(b) TABLE OF CONTENTS.—The table of contents for 
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 in-
stitution. 
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. 
Sec. 15. Discretionary surplus funds. 
Sec. 16. Determination of Budgetary Effects. 
SEC. 2. SENSE OF CONGRESS ON FUNDING THE LOAN-LOSS 
RESERVE FUND FOR SMALL DOLLAR LOANS. 
The sense of Congress is the following: 
(1) The Community Development Financial In-
stitutions Fund (the ‘‘CDFI Fund’’) is an agency of 
the Department of the Treasury, and was estab-
lished by the Riegle Community Development and 
Regulatory Improvement Act of 1994. The mission 
of the CDFI Fund is ‘‘to expand economic oppor-
tunity for underserved people and communities by 
supporting the growth and capacity of a national
network of community development lenders, inves-
tors, and financial service providers’’. A community 
development financial institution (a ‘‘CDFI’’) is a 
specialized financial institution serving low-income 
communities and a Community Development Entity 
(a ‘‘CDE’’) is a domestic corporation or partnership 
that is an intermediary vehicle for the provision of 
loans, investments, or financial counseling in low-in-
come communities. The CDFI Fund certifies CDFIs 
and CDEs. Becoming a certified CDFI or CDE al-
lows organizations to participate in various CDFI 
Fund programs as follows: 
(A) The Bank Enterprise Award Program, 
which provides FDIC-insured depository institu-
tions awards for a demonstrated increase in 
lending and investments in distressed commu-
nities and CDFIs. 
(B) The CDFI Program, which provides 
Financial and Technical Assistance awards to 
CDFIs to reinvest in the CDFI, and to build 
the capacity of the CDFI, including financing 
product development and loan loss reserves. 
(C) The Native American CDFI Assistance 
Program, which provides CDFIs and spon-
soring entities Financial and Technical Assist-
ance awards to increase lending and grow the 
number of CDFIs owned by Native Americans 
to help build capacity of such CDFIs. 
(D) The New Market Tax Credit Program, 
which provides tax credits for making equity in-
vestments in CDEs that stimulate capital in-
vestments in low-income communities. 
(E) The Capital Magnet Fund, which pro-
vides awards to CDFIs and nonprofit affordable 
housing organizations to finance affordable 
housing solutions and related economic develop-
ment activities. 
(F) The Bond Guarantee Program, a 
source of long-term, patient capital for CDFIs 
to expand lending and investment capacity for 
community and economic development purposes. 
(2) The Department of the Treasury is author-
ized to create multi-year grant programs designed to 
encourage low-to-moderate income individuals to es-
tablish accounts at federally insured banks, and to 
improve low-to-moderate income individuals’ access 
to such accounts on reasonable terms. 
(3) Under this authority, grants to participants 
in CDFI Fund programs may be used for loan-loss 
reserves and to establish small-dollar loan programs
by subsidizing related losses. These grants also allow 
for the providing recipients with the financial coun-
seling and education necessary to conduct trans-
actions and manage their accounts. These loans pro-
vide low-cost alternatives to payday loans and other 
nontraditional forms of financing that often impose 
excessive interest rates and fees on borrowers, and 
lead millions of Americans to fall into debt traps. 
Small-dollar loans can only be made pursuant to 
terms, conditions, and practices that are reasonable 
for the individual consumer obtaining the loan. 
(4) Program participation is restricted to eligi-
ble institutions, which are limited to organizations 
listed in section 501(c)(3) of the Internal Revenue 
Code and exempt from tax under 501(a) of such 
Code, federally insured depository institutions, com-
munity development financial institutions and State, 
local, or Tribal government entities. 
(5) Since its founding, the CDFI Fund has 
awarded over $3,300,000,000 to CDFIs and CDEs, 
allocated $54,000,000,000 in tax credits, and 
$1,510,000,000 in bond guarantees. According to 
the CDFI Fund, some programs attract as much as 
$10 in private capital for every $1 invested by the 
CDFI Fund. The Administration and the Congress
should prioritize appropriation of funds for the loan 
loss reserve fund and technical assistance programs 
administered by the Community Development Finan-
cial Institution Fund. 
SEC. 3. DEFINITIONS. 
In this Act: 
(1) COMMUNITY DEVELOPMENT FINANCIAL IN-
STITUTION.—The term ‘‘community development fi-
nancial institution’’ has the meaning given under 
section 103 of the Riegle Community Development 
and Regulatory Improvement Act of 1994 (12 
U.S.C. 4702). 
(2) MINORITY DEPOSITORY INSTITUTION.—The 
term ‘‘minority depository institution’’ has the 
meaning given under section 308 of the Financial 
Institutions Reform, Recovery, and Enforcement Act 
of 1989 (12 U.S.C. 1463 note), as amended by this 
Act. 
SEC. 4. INCLUSION OF WOMEN’S BANKS IN THE DEFINITION 
OF MINORITY DEPOSITORY INSTITUTION. 
Section 308(b)(1) of the Financial Institutions Re-
form, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
1463 note) is amended— 
(1) by redesignating subparagraphs (A), (B), 
and (C) as clauses (i), (ii), and (iii), respectively;
(2) by striking ‘‘means any’’ and inserting the 
following: ‘‘means— 
‘‘(A) any’’; and 
(3) in clause (iii) (as so redesignated), by strik-
ing the period at the end and inserting ‘‘; or’’; and 
(4) by inserting at the end the following new 
subparagraph: 
‘‘(B) any bank described in clause (i), (ii), 
or (iii) of section 19(b)(1)(A) of the Federal 
Reserve Act— 
‘‘(i) more than 50 percent of the out-
standing shares of which are held by 1 or 
more women; and 
‘‘(ii) the majority of the directors on 
the board of directors of which are 
women.’’. 
SEC. 5. ESTABLISHMENT OF IMPACT BANK DESIGNATION. 
(a) IN GENERAL.—Each Federal banking agency 
shall establish a program under which a depository institu-
tion with total consolidated assets of less than 
$10,000,000,000 may elect to be designated as an impact 
bank if the total dollar value of the loans extended by such 
depository institution to low-income borrowers is greater 
than or equal to 50 percent of the assets of such bank.
(b) NOTIFICATION OF ELIGIBILITY.—Based on data 
obtained through examinations of depository institutions, 
the appropriate Federal banking agency shall notify a de-
pository institution if the institution is eligible to be des-
ignated as an impact bank. 
(c) APPLICATION.—Regardless of whether or not it 
has received a notice of eligibility under subsection (b), 
a depository institution may submit an application to the 
appropriate Federal banking agency— 
(1) requesting to be designated as an impact 
bank; and 
(2) demonstrating that the depository institu-
tion meets the applicable qualifications. 
(d) LIMITATION ON ADDITIONAL DATA REQUIRE-
MENTS.—The Federal banking agencies may only impose 
additional data collection requirements on a depository in-
stitution under this section if such data is— 
(1) necessary to process an application sub-
mitted by the depository institution to be designated 
an impact bank; or 
(2) with respect to a depository institution that 
is designated as an impact bank, necessary to ensure 
the depository institution’s ongoing qualifications to 
maintain such designation.
(e) REMOVAL OF DESIGNATION.—If the appropriate 
Federal banking agency determines that a depository in-
stitution designated as an impact bank no longer meets 
the criteria for such designation, the appropriate Federal 
banking agency shall rescind the designation and notify 
the depository institution of such rescission. 
(f) 
RECONSIDERATION
OF
DESIGNATION; 
AP-
PEALS.—Under such procedures as the Federal banking 
agencies may establish, a depository institution may— 
(1) submit to the appropriate Federal banking 
agency a request to reconsider a determination that 
such depository institution no longer meets the cri-
teria for the designation; or 
(2) file an appeal of such determination. 
(g) RULEMAKING.—Not later than 1 year after the 
date of the enactment of this Act, the Federal banking 
agencies shall jointly issue rules to carry out the require-
ments of this section, including by providing a definition 
of a low-income borrower. 
(h) REPORTS.—Each Federal banking agency shall 
submit an annual report to the Congress containing a de-
scription of actions taken to carry out this section. 
(i) FEDERAL DEPOSIT INSURANCE ACT DEFINI-
TIONS.—In this section, the terms ‘‘depository institu-
tion’’, ‘‘appropriate Federal banking agency’’, and ‘‘Fed-
eral banking agency’’ have the meanings given such terms, 
respectively, in section 3 of the Federal Deposit Insurance 
Act (12 U.S.C. 1813). 
SEC. 6. MINORITY DEPOSITORIES ADVISORY COMMITTEES. 
(a) ESTABLISHMENT.—Each covered regulator shall 
establish an advisory committee to be called the ‘‘Minority 
Depositories Advisory Committee’’. 
(b) DUTIES.—Each Minority Depositories Advisory 
Committee shall provide advice to the respective covered 
regulator on meeting the goals established by section 308 
of the Financial Institutions Reform, Recovery, and En-
forcement Act of 1989 (12 U.S.C. 1463 note) to preserve 
the present number of covered minority institutions, pre-
serve the minority character of minority-owned institu-
tions in cases involving mergers or acquisitions, provide 
technical assistance, and encourage the creation of new 
covered minority institutions. The scope of the work of 
each such Minority Depositories Advisory Committee shall 
include an assessment of the current condition of covered 
minority institutions, what regulatory changes or other 
steps the respective agencies may be able to take to fulfill 
the requirements of such section 308, and other issues of 
concern to covered minority institutions. 
(c) MEMBERSHIP.—
(1) IN GENERAL.—Each Minority Depositories 
Advisory Committee shall consist of no more than 
10 members, who— 
(A) shall serve for one two-year term; 
(B) shall serve as a representative of a de-
pository institution or an insured credit union 
with respect to which the respective covered 
regulator is the covered regulator of such de-
pository institution or insured credit union; and 
(C) shall not receive pay by reason of their 
service on the advisory committee, but may re-
ceive travel or transportation expenses in ac-
cordance with section 5703 of title 5, United 
States Code. 
(2) DIVERSITY.—To the extent practicable, 
each covered regulator shall ensure that the mem-
bers of the Minority Depositories Advisory Com-
mittee of such agency reflect the diversity of covered 
minority institutions. 
(d) MEETINGS.— 
(1) IN GENERAL.—Each Minority Depositories 
Advisory Committee shall meet not less frequently 
than twice each year. 
(2) NOTICE AND INVITATIONS.—Each Minority 
Depositories Advisory Committee shall—
(A) notify the Committee on Financial 
Services of the House of Representatives and 
the Committee on Banking, Housing, and 
Urban Affairs of the Senate in advance of each 
meeting of the Minority Depositories Advisory 
Committee; and 
(B) invite the attendance at each meeting 
of the Minority Depositories Advisory Com-
mittee of— 
(i) one member of the majority party 
and one member of the minority party of 
the Committee on Financial Services of the 
House of Representatives and the Com-
mittee on Banking, Housing, and Urban 
Affairs of the Senate; and 
(ii) one member of the majority party 
and one member of the minority party of 
any relevant subcommittees of such com-
mittees. 
(e) NO TERMINATION OF ADVISORY COMMITTEES.— 
The termination requirements under section 14 of the 
Federal Advisory Committee Act (5 U.S.C. app.) shall not 
apply to a Minority Depositories Advisory Committee es-
tablished pursuant to this section. 
(f) DEFINITIONS.—In this section:
(1) COVERED REGULATOR.—The term ‘‘covered 
regulator’’ means the Comptroller of the Currency, 
the Board of Governors of the Federal Reserve Sys-
tem, the Federal Deposit Insurance Corporation, 
and the National Credit Union Administration. 
(2) COVERED
MINORITY
INSTITUTION.—The 
term ‘‘covered minority institution’’ means a minor-
ity depository institution (as defined in section 
308(b) of the Financial Institutions Reform, Recov-
ery, and Enforcement Act of 1989 (12 U.S.C. 1463 
note)). 
(3) DEPOSITORY INSTITUTION.—The term ‘‘de-
pository institution’’ has the meaning given under 
section 3 of the Federal Deposit Insurance Act (12 
U.S.C. 1813). 
(4) INSURED CREDIT UNION.—The term ‘‘in-
sured credit union’’ has the meaning given in section 
101 of the Federal Credit Union Act (12 U.S.C. 
1752). 
(g) TECHNICAL AMENDMENT.—Section 308(b) of the 
Financial Institutions Reform, Recovery, and Enforce-
ment Act of 1989 (12 U.S.C. 1463 note) is amended by 
adding at the end the following new paragraph: 
‘‘(3) DEPOSITORY INSTITUTION.—The term ‘de-
pository institution’ means an ‘insured depository in-
stitution’ (as defined in section 3 of the Federal De-
posit Insurance Act (12 U.S.C. 1813)) and an in-
sured credit union (as defined in section 101 of the 
Federal Credit Union Act (12 U.S.C. 1752)).’’. 
SEC. 7. FEDERAL DEPOSITS IN MINORITY DEPOSITORY IN-
STITUTIONS. 
(a) IN GENERAL.—Section 308 of the Financial In-
stitutions Reform, Recovery, and Enforcement Act of 
1989 (12 U.S.C. 1463 note) is amended— 
(1) by adding at the end the following new sub-
section: 
‘‘(d) FEDERAL DEPOSITS.—The Secretary of the 
Treasury shall ensure that deposits made by Federal agen-
cies in minority depository institutions and impact banks 
are collateralized or insured, as determined by the Sec-
retary. Such deposits shall include reciprocal deposits as 
defined in section 337.6(e)(2)(v) of title 12, Code of Fed-
eral Regulations (as in effect on March 6, 2019).’’; and 
(2) in subsection (b), as amended by section 
6(g), by adding at the end the following new para-
graph: 
‘‘(4) IMPACT BANK.—The term ‘impact bank’ 
means a depository institution designated by the ap-
propriate Federal banking agency pursuant to sec-
tion 5 of the Ensuring Diversity in Community 
Banking Act.’’. 
(b) TECHNICAL AMENDMENTS.—Section 308 of the 
Financial Institutions Reform, Recovery, and Enforce-
ment Act of 1989 (12 U.S.C. 1463 note) is amended— 
(1) in the matter preceding paragraph (1), by 
striking ‘‘section—’’ and inserting ‘‘section:’’; and 
(2) in the paragraph heading for paragraph (1), 
by striking ‘‘FINANCIAL’’ and inserting ‘‘DEPOSI-
TORY’’. 
SEC. 8. MINORITY BANK DEPOSIT PROGRAM. 
(a) IN GENERAL.—Section 1204 of the Financial In-
stitutions Reform, Recovery, and Enforcement Act of 
1989 (12 U.S.C. 1811 note) is amended to read as follows: 
‘‘SEC. 1204. EXPANSION OF USE OF MINORITY DEPOSITORY 
INSTITUTIONS. 
‘‘(a) MINORITY BANK DEPOSIT PROGRAM.— 
‘‘(1) ESTABLISHMENT.—There is established a 
program to be known as the ‘Minority Bank Deposit 
Program’ to expand the use of minority depository 
institutions. 
‘‘(2) ADMINISTRATION.—The Secretary of the 
Treasury, acting through the Fiscal Service, shall— 
‘‘(A) on application by a depository institu-
tion or credit union, certify whether such depos-
itory institution or credit union is a minority 
depository institution; 
‘‘(B) maintain and publish a list of all de-
pository institutions and credit unions that have 
been certified pursuant to subparagraph (A); 
and 
‘‘(C) periodically distribute the list de-
scribed in subparagraph (B) to— 
‘‘(i) all Federal departments and 
agencies; 
‘‘(ii) interested State and local govern-
ments; and 
‘‘(iii) interested private sector compa-
nies. 
‘‘(3) INCLUSION
OF
CERTAIN
ENTITIES
ON 
LIST.—A depository institution or credit union that, 
on the date of the enactment of this section, has a 
current certification from the Secretary of the 
Treasury stating that such depository institution or 
credit union is a minority depository institution shall 
be included on the list described under paragraph 
(2)(B). 
‘‘(b) EXPANDED USE AMONG FEDERAL DEPART-
MENTS AND AGENCIES.—
‘‘(1) IN GENERAL.—Not later than 1 year after 
the establishment of the program described in sub-
section (a), the head of each Federal department or 
agency shall develop and implement standards and 
procedures to prioritize, to the maximum extent pos-
sible as permitted by law and consistent with prin-
ciples of sound financial management, the use of mi-
nority depository institutions to hold the deposits of 
each such department or agency. 
‘‘(2) REPORT TO CONGRESS.—Not later than 2 
years after the establishment of the program de-
scribed in subsection (a), and annually thereafter, 
the head of each Federal department or agency shall 
submit to Congress a report on the actions taken to 
increase the use of minority depository institutions 
to hold the deposits of each such department or 
agency. 
‘‘(c) DEFINITIONS.—For purposes of this section: 
‘‘(1) CREDIT UNION.—The term ‘credit union’ 
has the meaning given the term ‘insured credit 
union’ in section 101 of the Federal Credit Union 
Act (12 U.S.C. 1752). 
‘‘(2) DEPOSITORY INSTITUTION.—The term ‘de-
pository institution’ has the meaning given in section
3 of the Federal Deposit Insurance Act (12 U.S.C. 
1813). 
‘‘(3) MINORITY
DEPOSITORY
INSTITUTION.— 
The term ‘minority depository institution’ has the 
meaning given that term under section 308 of this 
Act.’’. 
(b) CONFORMING AMENDMENTS.—The following pro-
visions are amended by striking ‘‘1204(c)(3)’’ and insert-
ing ‘‘1204(c)’’: 
(1) Section 808(b)(3) of the Community Rein-
vestment Act of 1977 (12 U.S.C. 2907(b)(3)). 
(2) Section 40(g)(1)(B) of the Federal Deposit 
Insurance Act (12 U.S.C. 1831q(g)(1)(B)). 
(3) Section 704B(h)(4) of the Equal Credit Op-
portunity Act (15 U.S.C. 1691c–2(h)(4)). 
SEC. 9. DIVERSITY REPORT AND BEST PRACTICES. 
(a) ANNUAL REPORT.—Each covered regulator shall 
submit to Congress an annual report on diversity includ-
ing the following: 
(1) Data, based on voluntary self-identification, 
on the racial, ethnic, and gender composition of the 
examiners of each covered regulator, disaggregated 
by length of time served as an examiner.
(2) The status of any examiners of covered reg-
ulators, based on voluntary self-identification, as a 
veteran. 
(3) Whether any covered regulator, as of the 
date on which the report required under this section 
is submitted, has adopted a policy, plan, or strategy 
to promote racial, ethnic, and gender diversity 
among examiners of the covered regulator. 
(4) Whether any special training is developed 
and provided for examiners related specifically to 
working with depository institutions and credit 
unions that serve communities that are predomi-
nantly minorities, low income, or rural, and the key 
focus of such training. 
(b) BEST PRACTICES.—Each Office of Minority and 
Women Inclusion of a covered regulator shall develop, pro-
vide to the head of the covered regulator, and make pub-
licly available best practices— 
(1) for increasing the diversity of candidates 
applying for examiner positions, including through 
outreach efforts to recruit diverse candidate to apply 
for entry-level examiner positions; and 
(2) for retaining and providing fair consider-
ation for promotions within the examiner staff for 
purposes of achieving diversity among examiners.