; and (B) at the election of the depository institution, shall, until April 1, 2022, for the purpose of calculating reserves and capital, and for any other accounting purpose, allow a depository institution to treat such loan in the same manner as the loan was (or would have been) treated on December 31, 2019. (2) Limitation (A) In general Paragraph (1) shall not apply to a depository institution if the appropriate Federal banking agency determines that— (i) the depository institution was not well capitalized as of December 31, 2019; (ii) applying paragraph (1) to the depository institution would pose a direct risk to the Deposit Insurance Fund or the National Credit Union Share Insurance Fund; or (iii) there is reasonable cause to believe that the depository institution or an institution-affiliated party is violating, or is about to violate, a Federal statute or rule. (B) Cease and desist letter requirement Before the appropriate Federal banking agency may make a determination under clause (ii) or (iii) of subparagraph (A), the appropriate Federal banking agency shall issue a cease and desist order to the depository institution and comply with the process required under section 8(b) of the Federal Deposit Insurance Act ( 12 U.S.C. 1818 ) with respect to a cease and desist order. . (d) Balance sheet treatment of loans Section 4013 of the CARES Act ( 15 U.S.C. 9051 ), as amended by subsection (c), is further amended by adding at the end the following: (f) Balance sheet treatment of loans For purposes of a financial institution’s balance sheet, the financial institution shall place all loans for which an election has been made under subsection (b) into a separate account. .