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91_HB0971
LRB9103305JSpr
1 AN ACT to amend the Illinois Banking Act by changing
2 Section 16.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Illinois Banking Act is amended by
6 changing Section 16 as follows:
7 (205 ILCS 5/16) (from Ch. 17, par. 323)
8 Sec. 16. Board of directors. The business and affairs of
9 a State bank shall be managed by its board of directors that
10 shall exercise its powers as follows:
11 (1) Directors shall be elected as provided in this Act.
12 Any omission to elect a director or directors shall not
13 impair any of the rights and privileges of the bank or of any
14 person in any way interested. The existing directors shall
15 hold office until their successors are elected and qualify.
16 (2) (a) Notwithstanding the provisions of any charter
17 heretofore or hereafter issued, the number of directors,
18 not fewer than 5 nor more than 25, may be fixed from time
19 to time by the stockholders at any meeting of the
20 stockholders called for the purpose of electing directors
21 or changing the number thereof by the affirmative vote of
22 at least two-thirds of the outstanding stock entitled to
23 vote at the meeting, and the number so fixed shall be the
24 board regardless of vacancies until the number of
25 directors is thereafter changed by similar action. At
26 least a majority of the directors must have resided in
27 the State of Illinois or within 100 miles of the main
28 banking premises for at least one year immediately
29 preceding their election and must be residents of the
30 State of Illinois or the territory within 100 miles of
31 the main banking premises during their continuance in
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1 office. Any director who becomes disqualified shall
2 forthwith resign his office.
3 (b) Notwithstanding the minimum number of directors
4 specified in paragraph (a) of this subsection, a State
5 bank that has been in existence for 10 years or more and
6 has less than $20,000,000 in assets, as of the December
7 31 immediately preceding the annual meeting of
8 shareholders at which directors are elected, may, subject
9 to the approval of the Commissioner, have a minimum of 3
10 directors; provided that if a State bank has fewer than 5
11 directors, at least one director shall not be an officer
12 or employee of the bank. The Commissioner shall annually
13 review the appropriateness of the grant of authority to
14 have a reduced minimum number of directors pursuant to
15 this paragraph (b).
16 (3) Except as otherwise provided in this paragraph (3),
17 directors shall hold office until the next annual meeting of
18 the stockholders succeeding their election or until their
19 successors are elected and qualify. If the board of directors
20 consists of 6 or more members, in lieu of electing the
21 membership of the whole board of directors annually, the
22 charter or by-laws of a State bank may provide that the
23 directors shall be divided into either 2 or 3 classes, each
24 class to be as nearly equal in number as is possible. The
25 term of office of directors of the first class shall expire
26 at the first annual meeting of the stockholders after their
27 election, that of the second class shall expire at the second
28 annual meeting after their election, and that of the third
29 class, if any, shall expire at the third annual meeting after
30 their election. At each annual meeting after classification,
31 the number of directors equal to the number of the class
32 whose terms expire at the time of the meeting shall be
33 elected to hold office until the second succeeding annual
34 meeting, if there be 2 classes, or until the third succeeding
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1 annual meeting, if there be 3 classes. Vacancies may be
2 filled by stockholders at a special meeting called for the
3 purpose.
4 If authorized by the bank's by-laws or an amendment
5 thereto, the directors of a State bank may properly fill a
6 vacancy or vacancies arising between shareholders' meetings,
7 but at no time may the number of directors selected to fill a
8 vacancy in this manner during any interim period between
9 shareholders' meetings exceed 33 1/3% of the total membership
10 of the board of directors.
11 (4) The board of directors shall hold regular meetings
12 at least once each month, provided that, upon prior written
13 approval by the Commissioner, the board of directors may hold
14 regular meetings less frequently than once each month but at
15 least once each calendar quarter. A special meeting of the
16 board of directors may be held as provided by the by-laws. A
17 special meeting of the board of directors may also be held
18 upon call by the Commissioner or a bank examiner appointed
19 under the provisions of this Act upon not less than 12 hours
20 notice of the meeting by personal service of the notice or by
21 mailing the notice to each of the directors at his residence
22 as shown by the books of the bank. A majority of the board
23 of directors shall constitute a quorum for the transaction of
24 business unless a greater number is required by the charter
25 or the by-laws. The act of the majority of the directors
26 present at a meeting at which a quorum is present shall be
27 the act of the board of directors unless the act of a greater
28 number is required by the charter or by the by-laws.
29 (5) A member of the board of directors shall be elected
30 president. The board of directors may appoint other officers,
31 as the by-laws may provide, and fix their salaries to carry
32 on the business of the bank. The board of directors may make
33 and amend by-laws (not inconsistent with this Act) for the
34 government of the bank and may, by the affirmative vote of a
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1 majority of the board of directors, establish reasonable
2 compensation of all directors for services to the corporation
3 as directors, officers, or otherwise. An officer, whether
4 elected or appointed by the board of directors or appointed
5 pursuant to the by-laws, may be removed by the board of
6 directors at any time.
7 (6) The board of directors shall cause suitable books
8 and records of all the bank's transactions to be kept.
9 (7) In discharging the duties of their respective
10 positions, the board of directors, committees of the board,
11 and individual directors may, in considering the best long
12 term and short term interests of the bank, consider the
13 effects of any action (including, without limitation, action
14 that may involve or relate to a merger or potential merger or
15 to a change or potential change in control of the bank) upon
16 employees, depositors, suppliers, and customers of the
17 corporation or its subsidiaries, communities in which the
18 main banking premises, branches, offices, or other
19 establishments of the bank or its subsidiaries are located,
20 and all pertinent factors.
21 (Source: P.A. 89-364, eff. 8-18-95; 90-301, eff. 8-1-97.)