Expanding Opportunity for Minority Depository Institutions Act
Floor Speech
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Ms. WATERS. Madam Speaker, I move to suspend the rules and pass the bill (H.R. 5315) to amend the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 to establish a Financial Agent Mentor- Protege Program within the Department of the Treasury, and for other purposes, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows: H.R. 5315
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE.
This Act may be cited as the ``Expanding Opportunity for Minority Depository Institutions Act'' or the ``Expanding Opportunity for MDIs Act''. SEC. 2. ESTABLISHMENT OF FINANCIAL AGENT MENTOR-PROTEGE PROGRAM.
(a) In General.--Section 308 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1463 note) is amended by adding at the end the following new subsection:
``(d) Financial Agent Mentor-Protege Program.--
``(1) In general.--The Secretary of the Treasury shall establish a program to be known as the `Financial Agent Mentor-Protege Program' (in this subsection referred to as the `Program') under which a financial agent designated by the Secretary or a large financial institution may serve as a mentor, under guidance or regulations prescribed by the Secretary, to a small financial institution to allow such small financial institution--
``(A) to be prepared to perform as a financial agent; or
``(B) to improve capacity to provide services to the customers of the small financial institution.
``(2) Outreach.--The Secretary shall hold outreach events to promote the participation of financial agents, large financial institutions, and small financial institutions in the Program at least once a year.
``(3) Exclusion.--The Secretary shall issue guidance or regulations to establish a process under which a financial agent, large financial institution, or small financial institution may be excluded from participation in the Program.
``(4) Report.--The Office of Minority and Women Inclusion of the Department of the Treasury shall include in the report submitted to Congress under section 342(e) of the Dodd-Frank Wall Street Reform and Consumer Protection Act information pertaining to the Program, including--
``(A) the number of financial agents, large financial institutions, and small financial institutions participating in such Program; and
``(B) the number of outreach events described in paragraph (2) held during the year covered by such report.
``(5) Definitions.--In this subsection:
``(A) Financial agent.--The term `financial agent' means any national banking association designated by the Secretary of the Treasury to be employed as a financial agent of the Government.
``(B) Large financial institution.--The term `large financial institution' means any entity regulated by the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, or the National Credit Union Administration that has total consolidated assets greater than or equal to $50,000,000,000.
``(C) Small financial institution.--The term `small financial institution' means--
``(i) any entity regulated by the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, or the National Credit Union Administration that has total consolidated assets lesser than or equal to $2,000,000,000; or
``(ii) a minority depository institution.''.
(b) Effective Date.--This Act and the amendments made by this Act shall take effect 90 days after the date of the enactment of this Act.
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Ms. WATERS. Madam Speaker, I yield myself such time as I may consume.
I rise in support of H.R. 5315, the Expanding Opportunity for Minority Depository Institutions Act, which is sponsored by Representative Joyce Beatty of Ohio, who chairs our Diversity and Inclusion Subcommittee. The bill is cosponsored by Representatives Gregory Meeks, Al Green, Emanuel Cleaver, David Scott, and Denny Heck.
This bill would codify the Department of the Treasury's Mentor- Protege Program, which is designed to encourage large banks to partner with smaller banks and minority depository institutions in enhancing their capabilities.
These partnerships can be critical for MDIs, in particular, to have access to the capital and investments they need to better serve their communities. The Subcommittee on Consumer Protection and Financial Institutions, led by Chairman Meeks, held two hearings on the importance of minority depository institutions in October and November of 2019.
We learned that MDIs face several challenges, including the ability to raise capital despite overall strong financial performance and challenges experienced as a result of serving communities that are often the first and the hardest hit in economic down cycles. This decline is contributing to growing banking deserts in minority communities.
We discussed the decline of MDIs and how alarming the numbers are. Since the financial crisis, we have seen the numbers of MDI banks decline from 215 to 148; and today, we only have 18 Black-owned banks in this country. It is clear regulators have failed to fulfill their statutory obligations to preserve and promote MDIs and that Congress must act.
In addition to Representative Beatty's bill, Representative Meeks has drafted a complementary bill, that is, H.R. 5322, the Ensuring Diversity in Community Banking Act, that will take additional steps to help MDIs. We hope this bill will move to the House floor very soon.
We must do what we can to ensure all current MDIs and, hopefully, future MDIs have access to the investments and partnerships they need to thrive while serving the communities that need them the most. Encouraging more partnerships, as H.R. 5315 would provide for, is one important step we can take to ensure MDIs have the support and, eventually, the capital they need to continue their good work of serving their communities.
Madam Speaker, I urge all Members to support this legislation, and I reserve the balance of my time.
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Ms. WATERS. Madam Speaker, I yield such time as she may consume to the gentlewoman from Ohio (Mrs. Beatty), the chair of the Subcommittee on Diversity and Inclusion and the sponsor of this legislation.
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Ms. WATERS. Madam Speaker, I yield myself the balance of my time to close.
Madam Speaker, we have a crisis with MDIs, and Congress must take action. H.R. 5315 codifies the Department of the Treasury's mentor- protege program which is designed to encourage large firms to assist these small financial institutions, including MDIs, in enhancing their capability. The program has fostered the establishment of long-term business relationships between large banks and MDIs that can be critical for MDIs to have access to the kind of capital they need to better serve their communities.
Madam Speaker, the Financial Services Committee approved the bill by a vote of 57-0, and the full House should also unanimously support this important legislation.
I urge Members to support H.R. 5315, I urge my colleagues to join me in supporting this important piece of legislation, and I yield back the balance of my time.
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