CA AB2581

Creates a Banking Development District Program within the Department of Financial Institutions to encourage banks to establish branches or develop new services in underserved communities lacking adequate banking access.

Requires local agencies and banks to jointly apply to the department for designation of underserved communities as banking development districts, with applications demonstrating unmet banking needs and the bank's plan to serve low-income consumers.

Authorizes the department to provide state incentives to participating banks, including access to interest-bearing public time deposits, and allows local agencies to offer additional incentives such as deposits, real estate assistance, tax breaks, and workforce training.

Directs the department to adopt regulations for the program and establish a performance review process posted online to evaluate whether banks are meeting their goals and improving financial services in underserved communities.

Requires the department to inform the State Treasurer about the program, allowing the Treasurer to consider banking development districts when administering the Time Deposit Program.