The bank has a line a credit to a non-profit organization that is reviewed and renewed annually. Typically, funds are used to bridge the gap in receipt of grants and governmental funding.

We have been counting this as a Community Development loan (CDL) annually, however the lender indicated that he was under the impression that we can report the renewal annually, for up to five years. I am not familiar with this caveat in the CRA and was wondering if anyone is familiar with the five year limitation.

Thank you in advance.

IMO you can report the annual renewal (which I would in the total $ and count) but the examiners will certainly see that it is a renewal to the same organization as they'll probably request a spreadsheet of individual CDLs prior to an exam. As far as any increment it wouldn't be in five year increments it would be your exam cycle (whatever that may be 2-3 years).

Report means to me 1) Included in annual submission and 2) presenting to examiners at exam time.

For simplification purposes - lets say we were examined every 7 years (wouldn't that be nice). The lender is saying that we can only submit and report this annually up to five years, so at exam time we would present the renewal 5 times not 7 times.

Where is he getting that?

News to me

so... if your exam cycle is three years, wouldn't you receive credit for all three years?

Seems as if the bank had a rogue examiner a few exams back and no one seem to question his guidance. Subsequently his interpretations were communicated to field Associates. Thanks.

There is no 5 year limitation. You are entitled to get credit each and every year the line is "renewed" or "refinanced" providing it meets the definition of "renewal" or "refinanced" as defined in CRA. This is the same treatment for small business and small farm loans or lines of credit.

It is OK to count a renewal each year even if there's no new money? Also, can we count a change in terms (i.e. rate adjustment) that takes place the next year after the initial origination?

Bump