SB2634sam001 93RD GENERAL ASSEMBLY

Sen. Terry Link

Filed: 2/26/2004

09300SB2634sam001 LRB093 18195 SAS 47807 a

AMENDMENT TO SENATE BILL 2634

AMENDMENT NO. ______. Amend Senate Bill 2634 by replacing everything after the enacting clause with the following:

"Section 5. The Corporate Fiduciary Act is amended by adding Section 9-7 as follows:

(205 ILCS 620/9-7 new)

Sec. 9-7. Investments and participation by affiliates.

(a) Any bank or trust company acting in its fiduciary capacity may purchase services or products, including, but not limited to, life insurance, equity derivatives, or securities underwritten or otherwise distributed by an affiliate of such bank or trust company or its affiliate directly from such affiliate or from a syndicate or selling group which includes the bank, trust company, or its affiliate, provided that the purchase is otherwise prudent and not prohibited by the instrument governing the fiduciary relationship. The provisions of this Section shall apply to such purchases of services or products made at the time of the initial offering thereof or at any time thereafter.

(b) The compensation for the services or products may be in addition to the compensation to which the bank, trust company, or its affiliate is otherwise entitled as fiduciary.

(c) Any bank or trust company acting in its fiduciary capacity may effect such purchases of services or products with or through its affiliate, provided that the fees paid to its affiliate and the terms and conditions of such purchases are reasonable and the transaction is not prohibited by the instrument governing the fiduciary relationship.

(d) A bank or a trust company shall disclose at least annually any purchase authorized by this Section that was made by the bank or trust company during the reporting period. The disclosure shall be given, in writing or electronically, to all persons entitled to receive statements of account activity, and shall include any capacities in which the bank or trust company or an affiliate acts for the issuer of the securities or the provider of the products or services and the fact that the bank, trust company or an affiliate may have an interest in the products or services.

(e) Notwithstanding the applicable provisions of Illinois law, including Section 2 of this Act, the provisions of this Section apply to any bank or trust company doing banking or trust business in this State, including, without limiting the generality of the foregoing, any national bank, national trust company, or any of its affiliates even if its principal place of business is not in this State.

Section 99. Effective date. This Act takes effect January 1, 2005.".