We came across with a RLOC made to Minority-Owned Credit Union.

Based on the Q&A 12(h)-1:
"Financial intermediaries including Community Development Financial Institutions (CDFIs), New Markets Tax Credit-eligible Community Development entities, Community Development Corporations (CDCs), Minority- and women-owned financial institutions, community loan funds or pools, and low-income or community development credit unions that primarily lend or facilitate lending to promote community development"

I am not too sure if the Bank can claim CDL just because the borrower is a Minority-owned Financial Institutions? or the Bank can only do so when the Minority-owned Financial Institution primarily lend to promote community development?
Moreover, what kind of documentation is recommended to substaintiate this claim?

Please advise. Thank you very much.

The bank will have to show that the minority owned credit union is lending or facilitating lending to promote community development (as defined in the rules).

The bank will have to engage in a conversation with the CU as to use of the loan proceeds and how the CU facilitates community development..what loans do they make, etc.

You will need specific information from them showing types of loans made, etc. (underwriting criteria, locations) to back up information to prove to an examiner.

Kathleen,

Thank you so much~
The information provided is really helpful. I know what to do now. Thank you very much.