§3908 Foreign loan evaluations

Summary

Banks must prepare a written economic feasibility evaluation before making any loan, lease, guarantee, or other credit that by itself or together with other credit is more than $20,000,000 to finance a project outside the United States or its territories whose main goal is mining, primary metal or mineral processing, fabrication, or metal-making (semi or finished). A senior official of the bank, or the lead bank if more than one bank is involved, must approve the evaluation in writing before the credit is granted. The evaluation must look at profit potential, effects on world markets, competitive strengths and weaknesses over the project’s life, the project’s likely impact on the host country’s long-term economic development, and whether the project’s revenues alone (not counting any government subsidy as defined in international agreements) can reasonably repay the credit. Federal banking examiners will review these evaluations when they inspect banks. The enforcement powers in sections 1818 and 3909 of the law (except 3909(d)) apply here. No one can bring a private lawsuit based on this rule.