Answer:
Unfortunately, there is no magic formula to let banks know if the amount of community development loans is sufficient or if the loans will even qualify to be considered a community development loan. However, in the winter of 2009, the FDIC issued guidance that the banks can follow to assist them in meeting their community development needs. The following is an excerpt from the guidance:
- Can bank management explain and validate how the loan or investment supports community development initiatives, including affordable housing, small business development, or community facilities and services that address the needs of LMI individuals?
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