(b) A Recipient shall comply with performance goals that have been established or negotiated with the CDFI Fund and which are based upon the Comprehensive Business Plan submitted as part of the Recipient's application. Such performance goals may include measures that require a Recipient to:

1. (1) Be financially sound;
2. (2) Be managerially sound;
3. (3) Maintain appropriate internal controls; and/or

4. (4) Achieve specific lending, investment, and development service objectives.

   Performance goals for Insured CDFIs shall be determined in consultation with the Appropriate Federal Banking Agency, as applicable. Such goals shall be incorporated in, and enforced under, the Recipient's Assistance Agreement. Performance goals for State-Insured Credit Unions may be determined in consultation with the Appropriate State Agency, if deemed appropriate by the CDFI Fund.

(c) The Assistance Agreement shall provide that, in the event of fraud, mismanagement, noncompliance with the Act and the CDFI Fund's regulations, or noncompliance with the terms and conditions of the Assistance Agreement on the part of the Recipient (or the Community Partner, if applicable), the CDFI Fund, in its discretion, may:

1. (1) Require changes in the performance goals set forth in the Assistance Agreement;
2. (2) Require changes in the Recipient's Comprehensive Business Plan;
3. (3) Revoke approval of the Recipient's application;
4. (4) Reduce or terminate the Recipient's assistance;
5. (5) Require repayment of any assistance that has been distributed to the Recipient;
6. (6) Bar the Recipient from reapplying for any assistance from the CDFI Fund; or
7. (7) Take such other actions as the CDFI Fund deems appropriate.

(e) The CDFI Fund shall notify the Appropriate Federal Banking Agency before imposing any sanctions on an Insured CDFI or other institution that is examined by or subject to the reporting requirements of that agency. The CDFI Fund shall not impose a sanction described in paragraph (c) of this section if the Appropriate Federal Banking Agency, in writing, and to the satisfaction of the CDFI Fund, not later than 30 calendar days after receiving notice from the CDFI Fund:

1. (1) Objects to the proposed sanction;

2. (2) Determines that the sanction would:

   1. (i) Have a material adverse effect on the safety and soundness of the institution; or
   2. (ii) Impede or interfere with an enforcement action against that institution by that agency;
3. (3) Proposes a comparable alternative action; and

4. (4) Specifically explains:

   1. (i) The basis for the determination under paragraph (e)(2) of this section and, if appropriate, provides documentation to support the determination; and
   2. (ii) How the alternative action suggested pursuant to paragraph (e)(3) of this section would be as effective as the sanction proposed by the CDFI Fund in securing compliance and deterring future noncompliance.