§ 28-6.1-7-11 — Equity investments in community development corporations and community based economic development; limits; exceptions to limits; exposure to liability

Indiana § 28-6.1-7-11

• Jurisdiction: Indiana
• Art. 6.1: SAVINGS BANKS
• Ch. 7: Powers of a Savings Bank Subject to the Rules of the

Text

(a) As used in this section, "community
based economic development" refers to activities that seek to address
economic causes of poverty within specific geographic areas,
revitalizing the economic and social base of low income communities
through activities that include:
(1) affordable housing development;
(2) small business and micro-enterprise support;
(3) commercial, industrial, and retail revitalization, retention, and
expansion;
(4) capacity development and technical assistance support for
community development corporations;
(5) employment and training efforts;
(6) human resource development; and
(7) social service enterprises.
(b) As used in this section, "community development corporation"
means a private, nonprofit corporation:
(1) whose board of directors is comprised primarily of community
representatives and business, civic, and community leaders; and
(2) whose principal purpose includes the provision of:
(A) housing;
(B) community based economic development projects; and
(C) social services;
that primarily benefit low income individuals and communities.
(c) As used in this section, "capital and surplus" has the meaning set
forth in IC 28-1-1-3(10).
(d) Subject to the limitations of this section, other laws, and any
regulation, rule, policy, or guidance adopted by the department
concerning investments in community based economic development,
a savings bank may invest directly or indirectly in equity investments
in a corporation, a limited partnership, a limited liability company, or
another entity organized as:
(1) a community development corporation;
(2) an entity formed primarily to support community based
economic development;
(3) an entity qualifying for the new markets tax credits under 26
U.S.C. 45D; or
(4) an entity approved by the director as being formed for a
predominantly civic, community, or public purpose and that:
(A) primarily benefits low and moderate income individuals;
(B) primarily benefits low and moderate income areas;
(C) primarily benefits areas targeted for redevelopment by a
government entity; or
(D) is a qualified investment under 12 CFR 25.23 for purposes
of the Community Reinvestment Act of 1977 (12 U.S.C. 2901
et seq.).
(e) Except as provided in subsection (f), the aggregate of all equity
investments by a savings bank under subsection (d) may not exceed:
(1) five percent (5%) of the capital and surplus of the savings
bank without the prior written approval of the director; and
(2) fifteen percent (15%) of the capital and surplus of the savings
bank under any circumstances.
(f) In determining whether to permit the aggregate of all equity
investments by a savings bank under subsection (d) to exceed five
percent (5%) of the capital and surplus of the savings bank under
subsection (e)(1), the director shall consider whether:
(1) the aggregate of all equity investments under subsection (d)
will pose a significant risk to the affected deposit insurance fund;
and
(2) the savings bank is adequately capitalized.
(g) A savings bank shall not make any investment under this section
if the investment would expose the savings bank to unlimited liability.

Legislative History

As added by P.L.42-1993, SEC.72. Amended by P.L.136-1994, SEC.5; P.L.2-1995, SEC.114; P.L.27-2012, SEC.85.