Interagency Q&A .12(v) – 1: Are loans to nonprofit organizations considered small business loans or are they considered community development loans?

Compliance > Regulation BB - CRA
Q:  § __.12(v) – 1: Are loans to nonprofit organizations considered small business loans or are they considered community development loans?
 
A:  To be considered a small business loan, a loan must meet the definition of “loans to small businesses” in the instructions in the Call Report.  In general, a loan to a nonprofit organization, for business or farm purposes, where the loan is secured by nonfarm nonresidential property and the original amount of the loan is $1 million or less, if a business loan, or $500,000 or less, if a farm loan, would be reported in the Call Report as a small business or small farm loan.  If a loan to a nonprofit organization is reportable as a small business or small farm loan, it cannot also be considered as a community development loan, except by a wholesale or limited purpose institution.  Loans to nonprofit organizations that are not small business or small farm loans for Call Report purposes may be considered as community development loans if they meet the regulatory definition of “community development.”
 
 
 
This Interagency Q&A, and others, was released in July 2016.  The 2016 Q&As consolidates and supersedes all previously published “Interagency Questions and Answers Regarding Community Reinvestment,” and were noted as being effective immediately.  They may be found here:  http://www.ffiec.gov/cra/qnadoc.htm
 

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