An entrepreneur is looking to federal immigration law to help some weak community banks to revitalize communities. The woman looked long and hard for an area to apply her concept. She looked at areas in Florida and on the West Coast, but later decided to try her concept close to the nation’s capitol to test out her idea.
This blog has reported a number of stories regarding the EB-5 visa program under federal immigration law. Foreign investors can gain a pathway to permanent residency under the EB-5 visa program by investing at least $1 million in a business that creates jobs in the United States.
In some situations, the investment can be a $500,000 deal if the business is located in a regional development zone, officially called a “regional center.” Florida currently has 20 recognized regional centers for the purposes of the EB-5 visa program.
The entrepreneur came up with the idea that EB-5 investors could be a good source of capital to revitalize distressed community banks. Federal regulators say that the EB-5 program has never been tapped before for investment in community banks. The entrepreneur chose the area around the nation’s capitol city to test out her new idea. She reportedly has lined up five foreign investors to help recapitalize a distressed community bank in an effort to benefit the community and create American jobs.
She believes that the EB-5 program can be a source of revenue that will exponentially benefit the community by increasing available cash for lending to revitalize other areas of the economy. The recapitalization will allow the community banks to make loans for housing, as well as other small businesses to help “achieve the goal of reinvestment and generation of jobs on an even larger scale.”
The EB-5 program has been around since 1990 and limited to 10,000 visa applications each year. In fiscal 2011, immigration officials issued 3,500 EB-5 visas, according to the State Department. U.S. Citizenship and Immigration Services says that the EB-5 program has created roughly 43,28o jobs in the United States in its history and is responsible for generating $2.2 billion in investments in the American economy.
Source: Washington Post, “Visa program could help bank recapitalize,” Danielle Douglas, Feb. 26, 2012