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90_SB1636
755 ILCS 5/21-2 from Ch. 110 1/2, par. 21-2
755 ILCS 5/21-2.04 from Ch. 110 1/2, par. 21-2.04
755 ILCS 5/21-2.05 from Ch. 110 1/2, par. 21-2.05
755 ILCS 5/21-2.07 from Ch. 110 1/2, par. 21-2.07
755 ILCS 5/21-2.08 from Ch. 110 1/2, par. 21-2.08
755 ILCS 5/21-2.11 from Ch. 110 1/2, par. 21-2.11
755 ILCS 5/21-2.12 from Ch. 110 1/2, par. 21-2.12
755 ILCS 5/21-2.13 from Ch. 110 1/2, par. 21-2.13
755 ILCS 5/21-2.09 rep.
755 ILCS 5/21-2.13a rep.
Amends the Probate Act of 1975 concerning the investment
of a ward's estate. Changes investments standards for
insured accounts, municipal bonds, notes secured by real
estate, corporate obligations and refunding obligations, life
insurance policies, stock, common trust funds, and open-end
investment companies. Effective immediately.
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1 AN ACT concerning investments of ward's estates.
2 Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4 Section 5. The Probate Act of 1975 is amended by
5 changing Sections 21-2, 21-2.04, 21-2.05, 21-2.07, 21-2.08,
6 21-2.11, 21-2.12, and 21-2.13 as follows:
7 (755 ILCS 5/21-2) (from Ch. 110 1/2, par. 21-2)
8 Sec. 21-2. Investments; Ward's Estate.)
9 (a) It is the duty of the representative to invest the
10 ward's money. A representative is chargeable with interest
11 at a rate equal to the rate on 90-day United States Treasury
12 Bills upon any money that the representative which he
13 wrongfully or negligently allows to remain in his hands
14 uninvested after it might have been invested. Reasonable
15 sums of money retained uninvested by the representative in
16 order to pay for the current or imminent expenses of the ward
17 shall not be considered wrongfully or negligently uninvested.
18 (b) Upon receiving the approval of the court, a
19 representative may hold any investments, or any increase
20 thereof, received by the representative him at the time of
21 the representative's his appointment or acquired by the ward,
22 although the investment is not otherwise authorized under
23 this Act, and the court has power to direct the
24 representative in connection therewith.
25 (c) A representative may invest only in the types of
26 property specified in Sections 21-2.01 through 21-2.15.
27 (Source: P.A. 84-494.)
28 (755 ILCS 5/21-2.04) (from Ch. 110 1/2, par. 21-2.04)
29 Sec. 21-2.04. Insured accounts, deposits, and
30 certificates. Withdrawable capital accounts, deposits,
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1 investment certificates or certificates of deposit of state
2 and federal savings and loan associations but, unless
3 otherwise authorized by a court of competent jurisdiction,
4 only to the extent that the accounts, deposits or
5 certificates are insured by the United States or any of its
6 agencies Federal Savings and Loan Insurance Corporation, and
7 share accounts in federal and state credit unions if the
8 credit unions are insured by the National Credit Union
9 Administration. Amounts invested in a savings and loan
10 association in excess of the amount insured by the United
11 States or any of its agencies Federal Savings and Loan
12 Insurance Corporation shall be secured by a surety bond taken
13 from a surety authorized to transact business in this State
14 in such sum, under such conditions, and with such security
15 sufficient to save the estate from loss.
16 (Source: P.A. 81-0391; 81-0403; 81-1509.)
17 (755 ILCS 5/21-2.05) (from Ch. 110 1/2, par. 21-2.05)
18 Sec. 21-2.05. Municipal bonds. Instruments providing for
19 the payment of money executed by or on behalf of any state of
20 the United States or the District of Columbia or any
21 governmental entity organized by or under the laws of any
22 state of the United States or the District of Columbia, to
23 carry out a public governmental or proprietary function,
24 acting through its corporate authorities, or that any
25 governmental entity has assumed or agreed to pay and that, at
26 the time of investment, have been given one of the top 4
27 rating grades by a nationally recognized rating service. The
28 direct obligations of any state, county, city, town, village,
29 school district, municipality and any political subdivision
30 of any of them, located in any state of the United States or
31 the District of Columbia, if the total direct obligations of
32 that state, county, city, town, village, school district,
33 municipality or political subdivision does not exceed 5 per
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1 cent of the assessed valuation of property for taxation at
2 the time of the investment, but no investment may be made in
3 obligations of any state, county, city, town, village, school
4 district, municipality or political subdivision which has
5 defaulted in a payment of principal or interest on any of its
6 bonded debt during the period of 5 years prior to the making
7 of the investment.
8 (Source: P.A. 79-328.)
9 (755 ILCS 5/21-2.07) (from Ch. 110 1/2, par. 21-2.07)
10 Sec. 21-2.07. Notes secured by real estate. All of the
11 notes secured by a first mortgage or trust deed upon improved
12 or income producing real estate situated in this State and
13 not exceeding two-thirds 1/2 of the value thereof at the time
14 of the investment.
15 (Source: P.A. 79-328.)
16 (755 ILCS 5/21-2.08) (from Ch. 110 1/2, par. 21-2.08)
17 Sec. 21-2.08. Corporate obligations. Obligations of any
18 company incorporated under the laws of the United States or
19 of any state of the United States or the District of Columbia
20 that, at the time of investment, have been given one of the
21 top 4 rating grades by a nationally recognized rating service
22 which are or have been a part of an issue of not less than
23 $3,000,000.
24 (Source: P.A. 79-328.)
25 (755 ILCS 5/21-2.11) (from Ch. 110 1/2, par. 21-2.11)
26 Sec. 21-2.11. Life, endowment, or annuity policies.
27 Life, endowment, or annuity policies upon the life of the
28 ward, or on the life of any person in whose life the ward has
29 an insurable interest, if the ward is the beneficiary, when
30 the policies of insurance are issued by companies,
31 associations or fraternal organizations that, at the time of
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1 investment, have been given one of the top 4 rating grades by
2 a nationally recognized rating service licensed to engage in
3 the business of insurance in this State. The order may
4 authorize the payment of annual premiums without further
5 application to the court.
6 (Source: P.A. 79-328.)
7 (755 ILCS 5/21-2.12) (from Ch. 110 1/2, par. 21-2.12)
8 Sec. 21-2.12. Stock. Preferred and common Shares of any
9 corporation organized with a market capitalization of over
10 $200,000,000 if under the laws of the United States or any
11 state thereof or of the District of Columbia if:
12 (a) in the case of preferred shares, the issuing
13 corporation has earned a net profit in 8 of the preceding 10
14 fiscal years as reflected in its statements and during each
15 of the preceding 10 fiscal years has paid dividends in the
16 specified amounts upon all of its preferred shares, if any,
17 outstanding during such year and has no dividend arrearages
18 on its preferred shares outstanding at the date of purchase;
19 (b) in the case of common shares, the issuing
20 corporation has earned a net profit in 8 of the preceding 10
21 fiscal years as reflected in its statements and during each
22 of the preceding 10 years has paid dividends in the specified
23 amounts upon all its preferred shares, if any, outstanding
24 during such year and in each of at least 8 of the preceding
25 10 fiscal years, including the preceding 5 fiscal years, has
26 paid dividends in some amount upon all its common shares, if
27 any, outstanding during such years;
28 (c) in the case of any shares, except shares of an
29 investment company or investment trust, the shares are fully
30 listed and registered on upon an exchange registered with the
31 Securities and Exchange Commission as a national securities
32 exchange or an electronic securities quotation system
33 regulated by the Securities and Exchange Commission.
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1 If a corporation has acquired a substantial part of its
2 property within 10 years immediately preceding the investment
3 by consolidation or merger or by the purchase of a
4 substantial part of the property of any other corporation,
5 the earnings of the predecessor or constituent corporations
6 shall be consolidated for the purpose of ascertaining whether
7 the requirements of this Section have been satisfied.
8 As used in this Section, "corporation" includes an
9 open-end or closed-end management type investment company or
10 investment trust which is registered with, and regulated by,
11 the Securities and Exchange Commission, which has no
12 preferred shares, bonds, loans or any other outstanding
13 securities having preference or priority as to assets or
14 earnings over its common shares, and which has net assets of
15 not less than $10,000,000 at the date of purchase, and
16 "common shares" includes shares, units or certificates of
17 beneficial interest or trust participation certificates
18 issued by an investment company or investment trust.
19 No investment in preferred or common shares of a
20 corporation may be made under this Section that which, at the
21 time such investment is made, would cause the market value of
22 all stock held in the ward's estate preferred and common
23 shares to exceed two-thirds 1/2 of the market value of the
24 estate then held by the representative.
25 (Source: P.A. 79-328.)
26 (755 ILCS 5/21-2.13) (from Ch. 110 1/2, par. 21-2.13)
27 Sec. 21-2.13. Common trust funds. Interests in one or
28 more common trust funds, as defined in and from time to time
29 established, maintained and administered pursuant to the
30 Common Trust Fund Act, the Investments of which are not
31 restricted to the investments otherwise authorized for
32 representatives by Sections 21-2.01 through 21-2.12 and
33 21-2.14 of this Act, provided that the investment in such
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1 common trust fund meets the standard of the prudent investor
2 person rule for the investment of trust funds.
3 (Source: P.A. 84-494.)
4 (755 ILCS 5/21-2.09 rep.)
5 (755 ILCS 5/21-2.13a rep.)
6 Section 10. The Probate Act of 1975 is amended by
7 repealing Sections 21-2.09 and 21-2.13a.
8 Section 99. Effective date. This Act takes effect upon
9 becoming law.