We are an ISB and have received past credit for a loan made to a start up small business in a moderate income census tract. The loan is now being renewed but the tract is now considered middle income under the new changes. Do we no longer receive credit for the loan because of the tract income changes or is the loan still eligble because it is a renewal?

Thanks.

Was this credit as a small business loan or a community development loan?

Small business loans count regardless of location...the income class of the tracts is considered when they look at how you are servicing your assessment area (reaching all tract income classes).

If a loan is a community development loan, and it qualified under old tract income, it will continue to count in your total. New money will be under new rules unless tract income has nothing to do with the qualification.

If we have a small business loan that also qualifies for a community development loan, I know we cannot report it as a community development loan, but can we keep internal record of it and get consideration for it during an FDIC exam?

If you are an ISB you can pull it from small business and use as CD. For everyone else, you can point such loans out in an exam for "special notice" (brownie points).

This is exactly what I needed! Thank you so much!

Really? I have one that I was just about to pull a loan out of our CD bucket due to this very reason.

It's really just a business loan over 1MM but the company was in a moderate tract and employed about 100 people. So it helped to RS the area.

Should I still try to get credit?

Is it a renewal?

I would submit it. If I am thinking along the right track, you made it under the pretense that it was helping a stabilze a moderate income area. Why shouldn't you get credit for that? Like Kaybee said, if you add new money you would not get credit for those additional funds because you could no longer say that you were infusing money into a moderate income area.

I think I am overthinking these changes a little and making it harder on myself than I should...

Was the original loan included in an exam already? I would be inclined to still include regardless, writing up the history as the context.

Yes, we've received CD credit in a past exam.

My understanding is that an ongoing project would continue to be counted. I would expect a new loan or an increase to be treated differently unless you can somehow qualify it. Otherwise, a prior loan already counted is in the past and won't come up for discussion. It certainly won't be revoked retroactively.