Sec. 14. (a) As used in this section, “community based economic development” refers to activities that seek to address economic development through affordable housing development or the rehabilitation of qualified rehabilitated buildings or certified historic structures, or that seeks 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) small business and micro-enterprise support;

(2) commercial, industrial, and retail revitalization, retention, and expansion;

(3) capacity development and technical assistance support for community development corporations;

(4) employment and training efforts;

(5) human resource development; and

(6) 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) As used in this section, “community and economic development entity” has the meaning set forth in 12 C.F.R. § 24.2(c).

     (e) As used in this section, “community development project” has the meaning set forth in 12 C.F.R. § 24.2(d).

     (f) As used in this section, “public welfare investment” means any investment permitted by 12 C.F.R. § 24.3.

     (g) 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, any bank or trust company 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;

(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 C.F.R. § 25.23 for purposes of the Community Reinvestment Act of 1977 (12 U.S.C. § 2901 et seq.); or

(5) an entity making qualified rehabilitation expenditures with respect to a qualified rehabilitated building or certified historic structure, as such terms are defined in section 47 of the Internal Revenue Code of 1986 or a similar state historic tax credit program, as provided for in Section 619(d)(1)(E) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C. § 1851(d)(1)(E)).

     (h) Subject to any regulation, rule, policy, or guidance adopted by the department, any bank or trust company may invest directly or indirectly in any:

(1) community and economic development entity;

(2) community development project; or

(3) other public welfare investment;

as long as the investment is in compliance with 12 CFR 24.

     (i) Except as provided in subsection (j), the aggregate of all equity investments by a bank or trust company under subsections (g) and (h) may not exceed:

(1) five percent (5%) of the capital and surplus of the bank or trust company without the prior written approval of the director; and

(2) fifteen percent (15%) of the capital and surplus of the bank or trust company under any circumstances.

     (j) In determining whether to permit the aggregate of all equity investments by a bank or trust company under subsections (g) and (h) to exceed five percent (5%) of the capital and surplus of the bank or trust company under subsection (i)(1), the director shall consider whether:

(1) the aggregate of all equity investments under subsections (g) and (h) will pose a significant risk to the affected deposit insurance fund; and

(2) the bank or trust company is adequately capitalized.

     (k) A bank or trust company shall not make any investment under this section if the investment would expose the bank or trust company to unlimited liability.

As added by P.L.27-2012, SEC.52. Amended by P.L.73-2016, SEC.19; P.L.31-2022, SEC.2; P.L.11-2023, SEC.90.