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§ 1834b. —  Community development organizations.



[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
  January 24, 2002 and December 19, 2002]
[CITE: 12USC1834b]

 
                       TITLE 12--BANKS AND BANKING
 
            CHAPTER 16--FEDERAL DEPOSIT INSURANCE CORPORATION
 
Sec. 1834b. Community development organizations


(a) Community development organizations described

    For purposes of this subtitle, any insured depository institution, 
or a qualified portion thereof, shall be treated as meeting the 
community development organization requirements of this section if--
        (1) the institution--
            (A) is a community development bank, or controls any 
        community development bank, which meets the requirements of 
        subsection (b) of this section;
            (B) controls any community development corporation, or 
        maintains any community development unit within the institution, 
        which meets the requirements of subsection (c) of this section;
            (C) invests in accounts in any community development credit 
        union designated as a low-income credit union, subject to 
        restrictions established for such credit unions by the National 
        Credit Union Administration Board; or
            (D) invests in a community development organization jointly 
        controlled by two or more institutions;

        (2) except in the case of an institution which is a community 
    development bank, the amount of the capital invested, in the form of 
    debt or equity, by the institution in the community development 
    organization referred to in paragraph (1) (or, in the case of any 
    community development unit, the amount which the institution 
    irrevocably makes available to such unit for the purposes described 
    in paragraph (3)) is not less than the greater of--
            (A) \1/2\ of 1 percent of the capital, as defined by 
        generally accepted accounting principles, of the institution; or
            (B) the sum of the amounts invested in such community 
        development organization; and

        (3) the community development organization provides loans for 
    residential mortgages, home improvement, and community development 
    and other financial services, other than financing for the purchase 
    of automobiles or extension of credit under any open-end credit plan 
    (as defined in section 1602(i) of title 15), to low- and moderate-
    income persons, nonprofit organizations, and small businesses 
    located in qualified distressed communities in a manner consistent 
    with the intent of this subtitle.

(b) Community development bank requirements

    A community development bank meets the requirements of this 
subsection if--
        (1) the community development bank has a 15-member advisory 
    board designated as the ``Community Investment Board'' and 
    consisting entirely of community leaders who--
            (A) shall be appointed initially by the board of directors 
        of the community development bank and thereafter by the 
        Community Investment Board from nominations received from the 
        community; and
            (B) are appointed for a single term of 2 years, except that, 
        of the initial members appointed to the Community Investment 
        Board, \1/3\ shall be appointed for a term of 8 months, \1/3\ 
        shall be appointed for a term of 16 months, and \1/3\ shall be 
        appointed for a term of 24 months, as designated by the board of 
        directors of the community development bank at the time of the 
        appointment;

        (2) \1/3\ of the members of the community development bank's 
    board of directors are appointed from among individuals nominated by 
    the Community Investment Board; and
        (3) the bylaws of the community development bank require that 
    the board of directors of the bank meet with the Community 
    Investment Board at least once every 3 months.

(c) Community development corporation requirements

    Any community development corporation, or community development unit 
within any insured depository institution meets the requirements of this 
subsection if the corporation or unit provides the same or greater, as 
determined by the appropriate Federal banking agency, community 
participation in the activities of such corporation or unit as would be 
provided by a Community Investment Board under subsection (b) of this 
section if such corporation or unit were a community development bank.

(d) Adequate dispersal requirement

    The appropriate Federal banking agency may approve the establishment 
of a community development organization under this subtitle only upon 
finding that the distressed community is not adequately served by an 
existing community development organization.

(e) Definitions

    For purposes of this section--

                   (1) Community development bank

        The term ``community development bank'' means any depository 
    institution (as defined in section 1813(c)(1) of this title).

               (2) Community development organization

        The term ``community development organization'' means any 
    community development bank, community development corporation, 
    community development unit within any insured depository 
    institution, or community development credit union.

                (3) Low- and moderate-income persons

        The term ``low- and moderate-income persons'' has the meaning 
    given such term in section 5302(a)(20) of title 42.

             (4) Nonprofit organization; small business

        The terms ``nonprofit organization'' and ``small business'' have 
    the meanings given to such terms by regulations which the 
    appropriate Federal banking agency shall prescribe for purposes of 
    this section.

                 (5) Qualified distressed community

        The term ``qualified distressed community'' has the meaning 
    given to such term in section 1834a(b) of this title.

(Pub. L. 102-242, title II, Sec. 234, Dec. 19, 1991, 105 Stat. 2315.)

                       References in Text

    This subtitle, referred to in subsecs. (a) and (d), is subtitle C 
(Secs. 231-234) of title II of Pub. L. 102-242, Dec. 19, 1991, 105 Stat. 
2308, known as the Bank Enterprise Act of 1991, which enacted this 
section and sections 1834 and 1834a of this title, amended section 1817 
of this title, and enacted provisions set out as a note under section 
1811 of this title. For complete classification of subtitle C to the 
Code, see section 231 of Pub. L. 102-242, set out as a Short Title of 
1991 Amendment note under section 1811 of this title and Tables.

                          Codification

    Section was enacted as part of the Bank Enterprise Act of 1991, and 
also as part of the Foreign Bank Supervision Enhancement Act of 1991 and 
as part of the Federal Deposit Insurance Corporation Improvement Act of 
1991, and not as part of the Federal Deposit Insurance Act which 
comprises this chapter.

                  Section Referred to in Other Sections

    This section is referred to in sections 1834a, 4713 of this title.



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