(a) The Arkansas Development Finance Authority shall establish procedures under which financial institutions participating in the Arkansas Capital Access Program for Small Business or the Arkansas Credit Reserve Program may submit claims for reimbursement for losses incurred as a result of qualified loan defaults.
(b) Costs for which a financial institution may be reimbursed from its loss reserve account include qualified loan principal, accrued interest on the principal, actual and necessary costs of seeking recovery of the principal amount and accrued interest on the principal, and any other related costs.
(c)
(1) A financial institution may seek reimbursement of qualified loan losses before the liquidation of collateral from defaulted qualified loans.
(2) The financial institution shall repay its loss reserve account for any moneys received as reimbursement under this section if the financial institution recovers moneys from the borrower or from the liquidation of collateral for the defaulted qualified loan.
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