12 U.S.C. § 4703a — Capital investments for neighborhoods

Page 1730 TITLE 12—BANKS AND BANKING § 4703a 1 So in original. The period probably should be a semicolon. and the Fund shall be within the Department of the Treasury.’’ Similar provisions were contained in the following prior appropriations act: Pub. L. 104–19, title I, July 27, 1995, 109 Stat. 237. § 4703a. Capital investments for neighborhoods disproportionately impacted by the COVID–19 pandemic (a) Definitions In this section— (1) the term ‘‘bank holding company’’ has the meaning given the term in section 1841 of this title; (2) the term ‘‘eligible institution’’ means any low- and moderate-income community fi- nancial institution that is eligible to partici- pate in the Program; (3) the term ‘‘Emergency Capital Investment Fund’’ means the Emergency Capital Invest- ment Fund established under subsection (b); (4) the term ‘‘low- and moderate-income community financial institution’’ means any financial institution that is— (A)(i) a community development financial institution; or (ii) a minority depository institution; and (B)(i) an insured depository institution that is not controlled by a bank holding company or savings and loan holding com- pany that is also an eligible institution; (ii) a bank holding company; (iii) a savings and loan holding company; or (iv) a federally insured credit union; (5) the term ‘‘minority’’ means any Black American, Native American, Hispanic Amer- ican, Asian American, Native Alaskan, Native Hawaiian, or Pacific Islander; (6) the term ‘‘minority depository institu- tion’’ means an entity that is— (A) a minority depository institution, as defined in section 308 of the Financial Insti- tutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1463 note); or (B) considered to be a minority depository institution by— (i) the appropriate Federal banking agency; or (ii) the National Credit Union Adminis- tration, in the case of an insured credit union; or (C) listed in the Federal Deposit Insurance Corporation’s Minority Depository Institu- tions List published for the Third Quarter 2020.1 (7) the term ‘‘Program’’ means the Emer- gency Capital Investment Program established under subsection (b); (8) the term ‘‘savings and loan holding com- pany’’ has the meaning given the term under section 1467a(a) of this title; and (9) the ‘‘Secretary’’ means the Secretary of the Treasury. (b) Establishment (1) Fund established There is established in the Treasury of the United States a fund to be known as the ‘‘Emergency Capital Investment Fund’’, which shall be administered by the Secretary. (2) Program authorized The Secretary is authorized to establish an emergency program known as the ‘‘Emergency Capital Investment Program’’ to support the efforts of low- and moderate-income commu- nity financial institutions to, among other things, provide loans, grants, and forbearance for small businesses, minority-owned busi- nesses, and consumers, especially in low-in- come and underserved communities, including persistent poverty counties, that may be dis- proportionately impacted by the economic ef- fects of the COVID–19 pandemic, by providing direct and indirect capital investments in low- and moderate-income community financial in- stitutions consistent with this section. (c) Purchases (1) In general Subject to paragraph (2), the Emergency Capital Investment Fund shall be available to the Secretary, without further appropriation or fiscal year limitation, for the costs of pur- chases (including commitments to purchase), and modifications of such purchases, of pre- ferred stock and other financial instruments from eligible institutions on such terms and conditions as are determined by the Secretary in accordance with this section. (2) Purchase limit The aggregate amount of purchases pursuant to paragraph (1) may not exceed $9,000,000,000. (d) Application (1) Acceptance The Secretary shall begin accepting applica- tions for capital investments under the Pro- gram not later than the end of the 30-day pe- riod beginning on December 27, 2020. (2) Consultation with regulators For each eligible institution that applies to receive a capital investment under the Pro- gram, the Secretary shall consult with the ap- propriate Federal banking agency or the Na- tional Credit Union Administration, as appli- cable, to determine whether the eligible insti- tution may receive such capital investment. (3) Eligibility (A) In general Only low- and moderate-income commu- nity financial institutions shall be eligible to participate in the Program. (B) Additional criteria The Secretary may establish additional criteria for participation by an institution in the Program, as the Secretary may deter- mine appropriate in furtherance of the goals of the Program. (4) Requirement to provide an emergency in- vestment lending plan for communities that may be disproportionately impacted by the economic effects of the COVID–19 pandemic (A) In general At the time that an applicant submits an application to the Secretary for a capital in- Page 1731 TITLE 12—BANKS AND BANKING § 4703a 2 So in original. Probably should be followed by ‘‘and’’. vestment under the Program, the applicant shall provide the Secretary, along with the appropriate Federal banking agency or the National Credit Union Administration, as applicable, an investment and lending plan that— (i) demonstrates that not less than 30 percent of the lending of the applicant over the past 2 fiscal years was made di- rectly to low- and moderate income bor- rowers, to borrowers that create direct benefits for low- and moderate-income populations, to other targeted populations as defined by the Fund, or any combina- tion thereof, as measured by the total number and dollar amount of loans; (ii) describes how the business strategy and operating goals of the applicant will address community development needs in communities that may be disproportion- ately impacted by the economic effects of COVID–19, which includes the needs of small businesses, consumers, nonprofit or- ganizations, community development, and other projects providing direct benefits to low- and moderate-income communities, low-income individuals, and minorities within the minority, rural, and urban low- income and underserved areas served by the applicant; (iii) includes a plan to provide commu- nity outreach and communication, where appropriate; 2 (iv) includes details on how the applicant plans to expand or maintain significant lending or investment activity in low- or moderate-income minority communities, especially those that may be dispropor- tionately impacted by COVID–19 to his- torically disadvantaged borrowers, and to minorities that have significant unmet capital or financial services needs. (B) Documentation In the case of an applicant that is certified as a community development financial insti- tution as of December 27, 2020, for purposes of subparagraph (A)(i), the Secretary may rely on documentation submitted by the ap- plicant to the Fund as part of certification compliance reporting. (5) Incentives to increase lending and provide affordable credit (A) Issuance and purchase of preferred stock An eligible institution that the Secretary approves for participation in the Program may issue to the Secretary, and the Sec- retary may purchase from such institution, preferred stock that— (i) provides that the preferred stock will— (I) be repaid not later than the end of the 10-year period beginning on the date of the capital investment under the Pro- gram; or (II) at the end of such 10-year period, be subject to such additional terms as the Secretary shall prescribe, which shall include a requirement that the stock shall carry the highest dividend or interest rate payable; and (ii) provides that the term and condition described under clause (i) shall not apply if the application of that term and condition would adversely affect the capital treat- ment of the stock under current or suc- cessor applicable capital provisions com- pared to a capital instrument with iden- tical terms other than the term and condi- tion described under clause (i). (B) Alternative financial instruments If the Secretary determines that an insti- tution cannot feasibly issue preferred stock as provided under subparagraph (A), such in- stitution may issue to the Secretary, and the Secretary may purchase from such insti- tution, a subordinated debt instrument whose terms are, to the extent possible, con- sistent with requirements under the Pro- gram applicable to the terms of preferred stock issued by institutions participating in the Program, with such adjustments as the Secretary determines appropriate, including by taking into account the tax treatment of payments made with respect to securities issued by such eligible institution. (6) Requirements on preferred stock and other financial instrument Any financial instrument issued to the Sec- retary by a low- and moderate-income commu- nity financial institution under the Program shall provide the following: (A) No dividends, interest or other similar required payments shall have a rate exceed- ing 2 percent per annum for the first 10 years. (B) The annual required payment rate of dividends, interest, or other similar pay- ments of a low- and moderate-income com- munity financial institution shall be ad- justed downward as follows, based on lending by the institution during the most recent annual period compared to lending by the in- stitution during the annual period ending on September 30, 2020: (i) No dividends, interest, or other simi- lar payments shall be due within the first 24-month period after the capital invest- ment by the Secretary. (ii) If the amount of lending by the insti- tution within minority, rural, and urban low-income and underserved communities and to low- and moderate-income bor- rowers has increased in amount between 200 percent and 400 percent of the amount of the capital investment, the annual pay- ment rate shall not exceed 1.25 percent per annum. (iii) If the amount of lending by the in- stitution within minority, rural, and urban low-income and underserved com- munities and to low- and moderate-income borrowers has increased by more than 400 percent of the capital investment, the an- nual payment rate shall not exceed 0.5 per- cent per annum. Page 1732 TITLE 12—BANKS AND BANKING § 4703a (7) Contingency of payments based on certain financial criteria (A) Deferral Any annual payments under this section shall be deferred in any quarter or payment period if any of the following is true: (i) The low- and moderate-income com- munity institution fails to meet the Tier 1 capital ratio or similar ratio as deter- mined by the Secretary. (ii) The low- and moderate-income com- munity financial institution fails to achieve positive net income for the quar- ter or payment period. (iii) The low- and moderate-income com- munity financial institution determines that the payment would be detrimental to the financial health of the institution and the Chief Executive Officer and Chief Fi- nancial Officer of the institution provide written notice, in a form reasonably satis- factory to the Secretary, of such deter- mination and the basis thereof. (B) Testing during next payment period Any annual payment that is deferred under this section shall— (i) be tested against the metrics de- scribed in subparagraph (A) at the begin- ning of the next payment period; and (ii) continue to be deferred until the metrics described in that subparagraph are no longer applicable. (8) Requirements in connection with failure to satisfy program goals Any financial instrument issued to the Sec- retary by a low- and moderate-income commu- nity financial institution under the Program may include such additional terms and condi- tions as the Secretary determines may be ap- propriate to provide the holders with rights in the event that such institution fails to satisfy applicable requirements under the Program or to protect the interests of the Federal Govern- ment. (e) Restrictions (1) In general Each low- and moderate-income community financial institution may only issue financial instruments or senior preferred stock under this subsection with an aggregate principal amount (or comparable amount) that is— (A) not more than $250,000,000; and (B)(i) not more than 7.5 percent of total as- sets for an institution with assets of more than $2,000,000,000; (ii) not more than 15 percent of total as- sets for an institution with assets of not less than $500,000,000 and not more than $2,000,000,000; and (iii) not more than 22.5 percent of total as- sets for an institution with assets of less than $500,000,000. (2) Set-asides Of the amounts made available under sub- section (c)(2), not less than $4,000,000,000 shall be made available for eligible institutions with total assets of not more than $2,000,000,000 that timely apply to receive a capital investment under the Program, of which not less than $2,000,000,000 shall be made available for eligible institutions with total assets of less than $500,000,000 that timely apply to receive a capital investment under the Program. (3) Holding of instruments Holding any instrument of a low- and mod- erate-income community financial institution described in paragraph (1) shall not give the Secretary or any successor that owns the in- strument any rights over the management of the institution in the ordinary course of busi- ness. (4) Sale of interest (A) In general With respect to a capital investment made into a low- and moderate-income community financial institution under this section, the Secretary— (i) prior to any sale of such capital in- vestment to a third party, shall provide the low- and moderate-income community financial institution a right of first refusal to buy back the investment under terms that do not exceed a value as determined by an independent third party; (ii) shall not sell more than 25 percent of the outstanding equity interests of any in- stitution to a single third party without the consent of such institution, which may not be unreasonably withheld; and (iii) with the permission of the institu- tion, may transfer or sell the interest of the Secretary in the capital investment for no consideration or for a de minimis amount to a mission aligned nonprofit af- filiate of an applicant that is an insured community development financial institu- tion. (B) Calculation of ownership for minority de- pository institutions The calculation and determination of own- ership thresholds for a depository institu- tion to qualify as a minority depository in- stitution shall exclude any dilutive effect of equity investments by the Federal Govern- ment, including under the Program or through the Fund. (5) Repayment incentives The Secretary may establish repayment in- centives that will apply to capital investments under the Program in a manner that the Sec- retary determines to be consistent with the purposes of the Program. (f) Treatment of capital investments The Secretary shall seek to establish the terms of preferred stock issued under the Pro- gram to enable such preferred stock to receive Tier 1 capital treatment. (g) Outreach to minority communities The Secretary shall require low- and mod- erate-income community financial institutions receiving capital investments under the Pro- gram to provide community outreach and com- munication, where appropriate, describing the Page 1733 TITLE 12—BANKS AND BANKING § 4703a availability and application process of receiving loans made possible by the Program through or- ganizations, trade associations, and individuals that represent or work within or are members of minority communities. (h) Restrictions (1) In general Not later than the end of the 30-day period beginning on December 27, 2020, the Secretary shall issue rules setting restrictions on execu- tive compensation, share buybacks, and divi- dend payments for recipients of capital invest- ments under the Program. (2) Conflicts of interest (A) Definitions In this paragraph: (i) Controlling interest The term ‘‘controlling interest’’ means owning, controlling, or holding not less than 20 percent, by vote or value, of the outstanding amount of any class of equity interest in an entity. (ii) Covered entity The term ‘‘covered entity’’ means an en- tity in which a covered individual directly or indirectly holds a controlling interest. For the purpose of determining whether an entity is a covered entity, the securities owned, controlled, or held by 2 or more in- dividuals who are related as described in clause (iii)(II) shall be aggregated. (iii) Covered individual The term ‘‘covered individual’’ means— (I) the President, the Vice President, the head of an Executive department, or a Member of Congress; and (II) the spouse, child, son-in-law, or daughter-in-law, as determined under ap- plicable common law, of an individual described in subclause (i). (iv) Executive department The term ‘‘Executive department’’ has the meaning given the term in section 101 of title 5. (v) Member of Congress The term ‘‘member of Congress’’ means a member of the Senate or House of Rep- resentatives, a Delegate to the House of Representatives, and the Resident Com- missioner from Puerto Rico. (vi) Equity interest The term ‘‘equity interest’’ means— (I) a share in an entity, without regard to whether the share is— (aa) transferable; or (bb) classified as stock or anything similar; (II) a capital or profit interest in a lim- ited liability company or partnership; or (III) a warrant or right, other than a right to convert, to purchase, sell, or subscribe to a share or interest described in subclause (I) or (II), respectively. (B) Prohibition Notwithstanding any other provision of this section, no covered entity may be eligi- ble for any investment made under the Pro- gram. (C) Requirement The principal executive officer and the principal financial officer, or individuals performing similar functions, of an entity seeking to receive an investment made under the Program shall, before that invest- ment is approved, certify to the Secretary and the appropriate Federal banking agency or the National Credit Union Administra- tion, as applicable, that the entity is eligible to receive the investment, including that the entity is not a covered entity. (i) Ineligibility of certain institutions An institution shall be ineligible to partici- pate in the Program if such institution is des- ignated in Troubled Condition by the appro- priate Federal banking agency or the National Credit Union Administration, as applicable, or is subject to a formal enforcement action with its primary Federal regulator that addresses unsafe or unsound lending practices. (j) Termination of investment authority (1) In general The authority to make new capital invest- ments in low- and moderate-income commu- nity financial institutions, including commit- ments to purchase preferred stock or other in- struments, provided under the Program shall terminate on the date that is 6 months after the date on which the national emergency concerning the novel coronavirus disease (COVID–19) outbreak declared by the Presi- dent on March 13, 2020 under the National Emergencies Act (50 U.S.C. 1601 et seq.) termi- nates. (2) Rule of construction Nothing in this subsection may be construed to limit any other authority of the Secretary not described in paragraph (1). (k) Collection of data Notwithstanding the Equal Credit Opportunity Act (15 U.S.C. 1691 et seq.)— (1) any low- and moderate-income commu- nity financial institution may collect data de- scribed in section 701(a)(1) of that Act (15 U.S.C. 1691(a)(1)) from borrowers and appli- cants for credit for the sole purpose and exclu- sive use of monitoring compliance under the plan required under subsection (d)(4); and (2) a low- and moderate-income community financial institution that collects the data de- scribed in paragraph (1) shall not be subject to adverse action related to that collection by the Bureau of Consumer Financial Protection or any other Federal agency. (l) Deposit of funds All funds received by the Secretary in connec- tion with purchases made pursuant this section, including interest payments, dividend pay- ments, and proceeds from the sale of any finan- cial instrument, shall be deposited into the Fund and used to provide financial and technical assistance pursuant to section 4707 of this title, except that subsection (e) of that section shall be waived. Page 1734 TITLE 12—BANKS AND BANKING § 4703a (m) Direct appropriation There is appropriated, out of amounts in the Treasury not otherwise appropriated, for fiscal year 2021, $9,000,000,000, to remain available until expended and to be deposited in the Emergency Capital Investment Fund, to carry out this sec- tion. (n) Administrative expenses Funds appropriated pursuant to subsection (m) may be used for administrative expenses, includ- ing the costs of modifying such investments, and reasonable costs of administering the Pro- gram of making, holding, managing, and selling the capital investments. (o) Administrative provisions The Secretary may take such actions as the Secretary determines necessary to carry out the authorities in this section, including the fol- lowing: (1) The Secretary may use the services of any agency or instrumentality of the United States or component thereof on a reimburs- able basis, and any such agency or instrumen- tality or component thereof is authorized to provide services as requested by the Secretary using all authorities vested in or delegated to that agency, instrumentality, or component. (2) The Secretary may enter into contracts, including contracts for services authorized by section 3109 of title 5. (3) The Secretary may designate any bank, savings association, trust company, security broker or dealer, asset manager, or invest- ment adviser as a financial agent of the Fed- eral Government and such institution shall perform all such reasonable duties related to this section as financial agent of the Federal Government as may be required. The Sec- retary shall have authority to amend existing agreements with financial agents to perform reasonable duties related to this section. (4) The Secretary may exercise any rights received in connection with any preferred stock or other financial instruments or assets purchased or acquired pursuant to the authori- ties granted under this section. (5) The Secretary may manage any assets purchased under this section, including reve- nues and portfolio risks therefrom. (6) The Secretary may sell, dispose of, trans- fer, exchange or enter into securities loans, re- purchase transactions, or other financial transactions in regard to, any preferred stock or other financial instrument or asset pur- chased or acquired under this section, upon terms and conditions and at a price deter- mined by the Secretary. (7) The Secretary may manage or prohibit conflicts of interest that may arise in connec- tion with the administration and execution of the authorities provided under this section. (8) The Secretary may establish and use ve- hicles to purchase, hold, and sell preferred stock or other financial instruments and issue obligations. (9) The Secretary may issue such regulations and other guidance as may be necessary or ap- propriate to define terms or carry out the au- thorities or purposes of this section. (10) The Secretary is authorized to use direct hiring authority to hire employees to admin- ister this section. (Pub. L. 103–325, title I, § 104A, as added Pub. L. 116–260, div. N, title V, § 522(a), Dec. 27, 2020, 134 Stat. 2079.) Editorial Notes REFERENCES IN TEXT Section 308 of the Financial Institutions Reform, Re- covery, and Enforcement Act of 1989, referred to in sub- sec. (a)(6)(A), is section 308 of Pub. L. 101–73, which is set out as a note under section 1463 of this title. The National Emergencies Act, referred to in subsec. (j)(1), is Pub. L. 94–412, Sept. 14, 1976, 90 Stat. 1255, which is classified principally to chapter 34 (§ 1601 et seq.) of Title 50, War and National Defense. For com- plete classification of this Act to the Code, see Short Title note set out under section 1601 of Title 50 and Ta- bles. The Equal Credit Opportunity Act, referred to in sub- sec. (k), is title VII of Pub. L. 90–321, as added by Pub. L. 93–495, title V, § 503, Oct. 28, 1974, 88 Stat. 1521, which is classified generally to subchapter IV (§ 1691 et seq.) of chapter 41 of this title. For complete classification of this Act to the Code, see Short Title note set out under section 1601 of this title and Tables. Statutory Notes and Related Subsidiaries PURPOSE Pub. L. 116–260, div. N, title V, § 520, Dec. 27, 2020, 134 Stat. 2079, provided that: ‘‘The purpose of this subtitle [subtitle B (§§ 520–524) of title V of div. N of Pub. L. 116–260, enacting this section and provisions set out as notes under this section] is to establish emergency pro- grams to revitalize and provide long-term financial products and service availability for, and provide in- vestments in, low- and moderate-income and minority communities that have disproportionately suffered from the impacts of the COVID–19 pandemic.’’ CONSIDERATIONS IN EXERCISING AUTHORITIES; REQUIREMENTS FOR CREDITORS Pub. L. 116–260, div. N, title V, § 521, Dec. 27, 2020, 134 Stat. 2079, provided that: ‘‘(a) IN GENERAL.—In exercising the authorities under this subtitle [subtitle B (§§ 520–524) of title V of div. N of Pub. L. 116–260, enacting this section and provisions set out as notes under this section] and the amend- ments made by this subtitle, the Secretary of the Treasury shall take into consideration increasing the availability of affordable credit for consumers, small businesses, and nonprofit organizations, including for projects supporting affordable housing, community- serving real estate, and other projects, that provide di- rect benefits to low- and moderate-income commu- nities, low-income and underserved individuals, and mi- norities, that have disproportionately suffered from the health and economic impacts of the COVID–19 pan- demic. ‘‘(b) REQUIREMENT FOR CREDITORS.—Any creditor par- ticipating in a program established under this subtitle or the amendments made by this subtitle shall fully comply with all applicable statutory and regulatory re- quirements relating to fair lending.’’ INSPECTOR GENERAL OVERSIGHT Pub. L. 116–260, div. N, title V, § 524, Dec. 27, 2020, 134 Stat. 2089, provided that: ‘‘(a) IN GENERAL.—The Inspector General of the De- partment of the Treasury shall conduct, supervise, and coordinate audits and investigations of any program es- tablished under this subtitle [subtitle B (§§ 520–524) of title V of div. N of Pub. L. 116–260, enacting this section and provisions set out as notes under this section] or the amendments made by this subtitle. Page 1735 TITLE 12—BANKS AND BANKING § 4705 ‘‘(b) REPORTING.—The Inspector General of the De- partment of the Treasury shall submit to the Com- mittee on Financial Services of the House of Rep- resentatives and the Committee on Banking, Housing, and Urban Affairs of the Senate and the Secretary of the Treasury not less frequently than 2 times per year a report relating to the oversight provided by the Office of the Inspector General, including any recommenda- tions for improvements to the programs described in subsection (a).’’ § 4704. Applications for assistance (a) Form and procedures An application for assistance under this sub- chapter shall be submitted in such form and in accordance with such procedures as the Fund shall establish. (b) Minimum requirements Except as provided in sections 4705 and 4712 of this title, the Fund shall require an applica- tion— (1) to establish that the applicant is, or will be, a community development financial insti- tution; (2) to include a comprehensive strategic plan for the organization that contains— (A) a business plan of not less than 5 years in duration that demonstrates that the ap- plicant will be properly managed and will have the capacity to operate as a commu- nity development financial institution that will not be dependent upon assistance from the Fund for continued viability; (B) an analysis of the needs of the invest- ment area or targeted population and a strategy for how the applicant will attempt to meet those needs; (C) a plan to coordinate use of assistance from the Fund with existing Federal, State, local, and tribal government assistance pro- grams, and private sector financial services; (D) an explanation of how the proposed ac- tivities of the applicant are consistent with existing economic, community, and housing development plans adopted by or applicable to an investment area or targeted popu- lation; and (E) a description of how the applicant will coordinate with community organizations and financial institutions which will provide equity investments, loans, secondary mar- kets, or other services to investment areas or targeted populations; (3) to include a detailed description of the applicant’s plans and likely sources of funds to match the amount of assistance requested from the Fund; (4) in the case of an applicant that has pre- viously received assistance under this sub- chapter, to demonstrate that the applicant— (A) has substantially met its performance goals and otherwise carried out its respon- sibilities under this subchapter and the as- sistance agreement; and (B) will expand its operations into a new investment area or serve a new targeted pop- ulation, offer more products or services, or increase the volume of its business; (5) in the case of an applicant with a prior history of serving investment areas or tar- geted populations, to demonstrate that the ap- plicant— (A) has a record of success in serving in- vestment areas or targeted populations; and (B) will expand its operations into a new investment area or to serve a new targeted population, offer more products or services, or increase the volume of its current busi- ness; and (6) to include such other information as the Fund deems appropriate. (c) Preapplication outreach program The Fund shall provide an outreach program to identify and provide information to potential applicants and may provide technical assistance to potential applicants, but shall not assist in the preparation of any application. (Pub. L. 103–325, title I, § 105, Sept. 23, 1994, 108 Stat. 2170.) § 4705. Community partnerships (a) Application An application for assistance may be filed jointly by a community development financial institution and a community partner to carry out a community partnership. (b) Application requirements The Fund shall require a community partner- ship application— (1) to meet the minimum requirements es- tablished for community development finan- cial institutions under section 4704(b) of this title, except that the criteria specified in para- graphs (1) and (2)(A) of section 4704(b) of this title shall not apply to the community part- ner; (2) to describe how each coapplicant will par- ticipate in carrying out the community part- nership and how the partnership will enhance activities serving the investment area or tar- geted population; and (3) to demonstrate that the community part- nership activities are consistent with the stra- tegic plan submitted by the community devel- opment financial institution coapplicant. (c) Selection criteria The Fund shall consider a community partner- ship application based on— (1) the community development financial in- stitution coapplicant— (A) meeting the minimum selection cri- teria described in section 4704 of this title; and (B) satisfying the selection criteria of sec- tion 4706 of this title; (2) the extent to which the community part- ner coapplicant will participate in carrying out the partnership; (3) the extent to which the community part- nership will enhance the likelihood of success of the community development financial insti- tution coapplicant’s strategic plan; and (4) the extent to which service to the invest- ment area or targeted population will be bet- ter performed by a partnership as opposed to the individual community development finan- cial institution coapplicant.