Our bank funds loans through a State bond program that targets households earning 80% median income or less. I initially thought these would be considered community development loans, but they are HMDA reportable. Would these "loans" qualify as community development investments? I want credit for them somewhere!

Can't move them out of HMDA, but you will get additional consideration as a program directed to low to mod borrowers. It will get consideration under the lending test, but not the investment test. Ain't CRA grand ?

You said your bank funds loans through a state bond program targeting LMI households. Do you fund the actual loans? Or do you buy the bonds that fund the loans? If you buy the bonds, that would probably be a qualified investment as long as the bonds benefitted your assessment area or a broader area that includes your assessment area.

Anyway, if you provide us with some clarification on just how the program works, we can give you more specific advice. AR.

The Bank originates the loan and the State invests in them. I don't think I will be able to include the dollars for these loans in my community development loan total because they are HMDA reportable. But I do think I will be able to receive some credit for the program during my next CRA exam (hopefully).

Sounds like it's not an investment, but you still will receive credit for the program on your PE. This is a special program targeted to LMI people. It falls under the unique/innovative/flexible portion of the lending test.

While the grand number is not qualified in either CD Lending or CD Investments, don't disdain the value they provide on the lending test overall. You can't excell in the exam if what you're doing is routine and generally provided by all lenders out there. The road to Outstanding not only relies on total bucks in CD categories, but also on the value you bring through the use of special programs that are unique/flexible or innovative. Highlight those features of this program, and quantify the value the program has brought to your AA (ie 200 loans to LMI individuals with total bucks loaned at $3.4MM) and you'll get plenty of credit for the program.