12C.6A - ELIGIBILITY FOR STATE PUBLIC FUNDS -- PROCEDURES.
12C.6A ELIGIBILITY FOR STATE PUBLIC FUNDS --
PROCEDURES.
1. Public funds of the state shall not be deposited in a
financial institution which does not demonstrate a commitment to
serve the needs of the local community in which it is chartered to do
business, including the needs of neighborhoods, rural areas, and
small businesses in communities served by the financial institution.
These needs include credit services as well as deposit services.
2. In addition to establishing a minimum interest rate for public
funds pursuant to section 12C.6, the committee composed of the
superintendent of banking, the superintendent of credit unions, the
auditor of state or a designee, and the treasurer of state shall
develop a list of financial institutions eligible to accept state
public funds. The committee shall require that a financial
institution seeking to qualify for the list shall annually provide
the committee a written statement that the financial institution has
complied with the requirements of this chapter and has a commitment
to community reinvestment consistent with the safe and sound
operation of a financial institution, unless the financial
institution has received a rating of satisfactory or higher pursuant
to the federal Community Reinvestment Act, 12 U.S.C. § 2901 et seq.,
and such rating is certified to the committee by the superintendent
of banking. To qualify for the list, a financial institution must
demonstrate a continuing commitment to meet the credit needs of the
local community in which it is chartered.
3. The committee may require a financial institution to provide
public notice inviting the public to submit comments to the financial
institution regarding its community lending activities. Each
financial institution shall maintain a file open to public inspection
which contains public comments received on its community investment
activities, and the financial institution's response to those
comments. The committee shall adopt procedures for both of the
following:
a. To receive information relating to a financial
institution's commitment to community reinvestment.
b. To receive challenges from any person to a financial
institution's continued eligibility to receive public funds.
4. At least once a year the committee shall review any challenges
that have been filed pursuant to subsection 3. The committee may
hold a public hearing to consider the challenge. In considering a
challenge, the committee shall review documents filed with federal
regulatory authorities pursuant to the Community Reinvestment Act, 12
U.S.C. § 2901 et seq., and regulations adopted pursuant to the Act,
as amended to January 1, 1990. In addition, consistent with the
confidentiality of financial institution records the committee shall
consider other factors including, but not limited to, the following:
a. Activities conducted to determine the credit needs of the
community.
b. Marketing and special credit-related programs to make
citizens in the community aware of the credit services offered.
c. A description of how services actually provided satisfied
the needs described under paragraph "a".
d. Practices intended to discourage application for home
mortgages, small business loans, small farm loans, community
development loans, and, if consumer lending constitutes a substantial
majority of a financial institution's business, consumer loans.
e. Geographic distribution of credit extensions, credit
applications and credit denials.
f. Evidence of prohibited discriminatory or other illegal
credit practices.
g. Participation in local community and rural development and
redevelopment projects, and in state and federal business and
economic development programs, including investment in an Iowa
agricultural industry finance corporation formed under the Iowa
agricultural industry finance Act pursuant to chapter 15E.
h. Origination or purchase of residential mortgage loans,
housing rehabilitation loans, home improvement loans and business or
farm loans within the community.
i. Ability to meet various community credit needs based on
financial condition, size, legal impediments, and local economic
conditions.
5. a. A person who believes a bank has failed to meet its
community reinvestment responsibility may file a complaint with the
committee detailing the basis for that belief.
b. If any committee member, in the member's discretion, finds
that the complaint has merit, the member may order the bank alleged
to have failed to meet its community reinvestment responsibility to
attend and participate in a meeting with the complainant. The
committee member may specify who, at minimum, shall represent the
bank at the meeting. At the meeting, or at any other time, the bank
may, but is not required to, enter into an agreement with a
complainant to correct alleged failings.
c. A majority of the committee may order a bank against which
a complaint has been filed pursuant to this subsection, to disclose
such additional information relating to community reinvestment as
required by the order of the majority of the committee.
d. This subsection does not preempt any other remedies
available under statutory or common law available to the committee,
the superintendent of banking, or aggrieved persons to cure
violations of this section or chapter 524, or rules adopted pursuant
to this section or chapter 524. The committee may conduct a public
hearing as provided in subsection 4 based upon the same complaint.
An order finding merit in a complaint and ordering a meeting is not
an election of remedies. Section History: Recent Form
84 Acts, ch 1230, § 11
C85, § 453.6A
90 Acts, ch 1002, § 1
C93, §12C.6A
96 Acts, ch 1021, §2, 3; 99 Acts, ch 53, §1; 99 Acts, ch 117, §5,
15; 2000 Acts, ch 1154, §1; 2002 Acts, ch 1096, §4, 5, 17
Referred to in § 12B.10, 12C.6, 524.223