Apparently, the lending practices of Mountain Valley Community Bank have pleased the U.S. Treasury Department.

The financial institution recently received notice that the federal government would invest $3.4 million in the bank as a part of the treasury’s Capital Purchase Plan.

"This would increase our lending power to our company because the investment would increase our capital," said Marc Greene, president and CEO of Mountain Valley’s holding company.

Mountain Valley Community Bank, which opened in 2004, is based in Cleveland and has branches in Gainesville and Jefferson.

According to the Treasury Department, the purpose of the program is to "encourage U.S. financial institutions to build capital to increase the flow of financing to U.S. businesses and consumers and to support the U.S. economy."

"This is a time when economies at all levels — local, state, regional and national — urgently need supportive, quality oriented, well-run banks," Greene said.

"Our bank exceeds the regulatory requirements to be a well-capitalized bank. This investment into our company will only strengthen our capital position."

The program is part of the Troubled Asset Relief Program passed by the U.S. Congress last year to stimulate the nation’s slumping financial markets.

Before being approved for the investment, Mountain Valley had to meet several standards, including "ensuring that incentive compensation for senior executives does not encourage and unnecessary and excessive risks that threaten the value of the financial institution."

Prior to accepting the federal funds, the bank’s board of directors has to approve the measure. According to Greene, it has up to six months to reach a decision.

Should the bank accept the investment, the institution would also have to adopt the "treasury department’s standards for executive compensation and corporate governance, for the period during which the treasury holds equity issued under this program."

In general, those standards apply to the chief executive and financial officers, plus the other three highest compensated executives.