Public Act 90-0665 of the 90th General Assembly
Public Act 90-0665
SB1528 Enrolled LRB9009866JSmg
AN ACT concerning financial regulation, amending named
Acts.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Bank Examiners' Education
Foundation Act is amended by changing Section 6 as follows:
(20 ILCS 3210/6) (from Ch. 17, par. 406)
Sec. 6. The Board shall have the power:
(1) To promulgate reasonable rules for the purpose of
administering the provisions of this Act.
(2) To issue orders for the purpose of administering the
provisions of this Act and any rule promulgated in accordance
with this Act.
(3) To require the Commissioner to furnish the Board
space for meetings to be held by the Board as well as to
require the Commissioner to provide the technical assistance
and clerical and professional support as the Board may
require.
(4) To adopt its own bylaws with respect to board
meetings and procedures. The bylaws shall provide that:
(A) A majority of the whole Board constitutes a
quorum.
(B) A majority of the quorum shall constitute
effective action except that a vote of a majority of the
whole Board shall be necessary for the approval of rules
and regulations proposed for adoption by the Commissioner
under paragraph (1) of this Section and shall be
necessary for recommendations made to the Commissioner
with regard to proposed amendments to this Act or to the
administrative practices hereunder.
(C) The Board shall meet at least once in each
calendar year and upon the call of the Commissioner or a
majority of the Board quarter. The Commissioner or a
majority of the Board may call such special or additional
meetings as may be deemed he or they deem necessary or
desirable.
(5) To authorize the transfer of funds from the Illinois
Bank Examiners' Education Fund to the Bank and Trust Company
Fund. Any amount so transferred shall be retransferred to
the Illinois Bank Examiners' Education Fund from the Bank and
Trust Company Fund within a period not to exceed 3 years.
(6) To maintain and direct the investments of the
Illinois Bank Examiners' Education Fund as provided in the
Illinois Banking Act and to issue an annual report to the
Governor, the General Assembly and all State-chartered banks
on the activities of the Foundation during the preceding year
which shall include, but is not limited to, detailing the
monies generated and deposited into the Illinois Bank
Examiners' Education Fund by the special education fee,
voluntary contributions, and income from investments and the
expenditures from the Fund.
(Source: P.A. 86-1449; 87-1038.)
Section 10. The Illinois Banking Act is amended by
changing Sections 5, 9, 10, 13, 21.1, 24, 48, and 48.1 as
follows:
(205 ILCS 5/5) (from Ch. 17, par. 311)
Sec. 5. General corporate powers. A bank organized
under this Act or subject hereto shall be a body corporate
and politic and shall, without specific mention thereof in
the charter, have all the powers conferred by this Act and
the following additional general corporate powers:
(1) To sue and be sued, complain, and defend in its
corporate name.
(2) To have a corporate seal, which may be altered at
pleasure, and to use the same by causing it or a facsimile
thereof to be impressed or affixed or in any manner
reproduced, provided that the affixing of a corporate seal to
an instrument shall not give the instrument additional force
or effect, or change the construction thereof, and the use of
a corporate seal is not mandatory.
(3) To make, alter, amend, and repeal bylaws, not
inconsistent with its charter or with law, for the
administration of the affairs of the bank.
(4) To elect or appoint and remove officers and agents
of the bank and define their duties and fix their
compensation.
(5) To adopt and operate reasonable bonus plans,
profit-sharing plans, stock-bonus plans, stock-option plans,
pension plans and similar incentive plans for its directors,
officers and employees.
(5.1) To manage, operate and administer a fund for the
investment of funds by a public agency or agencies, including
any unit of local government or school district, or any
person. The fund for a public agency shall invest in the
same type of investments and be subject to the same
limitations provided for the investment of public funds. The
fund for public agencies shall maintain a separate ledger
showing the amount of investment for each public agency in
the fund. "Public funds" and "public agency" as used in this
Section shall have the meanings ascribed to them in Section 1
of the Public Funds Investment Act.
(6) To make reasonable donations for the public welfare
or for charitable, scientific, religious or educational
purposes.
(7) To borrow or incur an obligation; and to pledge its
assets:
(a) to secure its borrowings, its lease of personal
or real property or its other nondeposit obligations;
(b) to enable it to act as agent for the sale of
obligations of the United States;
(c) to secure deposits of public money of the
United States, whenever required by the laws of the
United States, including without being limited to,
revenues and funds the deposit of which is subject to the
control or regulation of the United States or any of its
officers, agents, or employees and Postal Savings funds;
(d) to secure deposits of public money of any state
or of any political corporation or subdivision thereof
including, without being limited to, revenues and funds
the deposit of which is subject to the control or
regulation of any state or of any political corporation
or subdivisions thereof or of any of their officers,
agents, or employees;
(e) to secure deposits of money whenever required
by the National Bankruptcy Act;
(f) (blank); and
(g) to secure trust funds commingled with the
bank's funds, whether deposited by the bank or an
affiliate of the bank, pursuant to Section 2-8 of the
Corporate Fiduciary Act.
(8) To own, possess, and carry as assets all or part of
the real estate necessary in or with which to do its banking
business, either directly or indirectly through the ownership
of all or part of the capital stock, shares or interests in
any corporation, association, trust engaged in holding any
part or parts or all of the bank premises, engaged in such
business and in conducting a safe deposit business in the
premises or part of them, or engaged in any activity that the
bank is permitted to conduct in a subsidiary pursuant to
paragraph (12) of this Section 5.
(9) To own, possess, and carry as assets other real
estate to which it may obtain title in the collection of its
debts or that was formerly used as a part of the bank
premises, but title to any real estate except as herein
permitted shall not be retained by the bank, either directly
or by or through a subsidiary, as permitted by subsection
(12) of this Section for a total period of more than 10 years
after acquiring title, either directly or indirectly.
(10) To do any act, including the acquisition of stock,
necessary to obtain insurance of its deposits, or part
thereof, and any act necessary to obtain a guaranty, in whole
or in part, of any of its loans or investments by the United
States or any agency thereof, and any act necessary to sell
or otherwise dispose of any of its loans or investments to
the United States or any agency thereof, and to acquire and
hold membership in the Federal Reserve System.
(11) Notwithstanding any other provisions of this Act or
any other law, to do any act and to own, possess, and carry
as assets property of the character, including stock, that is
at the time authorized or permitted to national banks by an
Act of Congress, but subject always to the same limitations
and restrictions as are applicable to national banks by the
pertinent federal law and subject to applicable provisions of
the Financial Institutions Insurance Sales Law.
(12) To own, possess, and carry as assets stock of one
or more corporations that is, or are, engaged in one or more
of the following businesses:
(a) holding title to and administering assets
acquired as a result of the collection or liquidating of
loans, investments, or discounts; or
(b) holding title to and administering personal
property acquired by the bank, directly or indirectly
through a subsidiary, for the purpose of leasing to
others, provided the lease or leases and the investment
of the bank, directly or through a subsidiary, in that
personal property otherwise comply with Section 35.1 of
this Act; or
(c) carrying on or administering any of the
activities excepting the receipt of deposits or the
payment of checks or other orders for the payment of
money in which a bank may engage in carrying on its
general banking business; provided, however, that nothing
contained in this paragraph (c) shall be deemed to permit
a bank organized under this Act or subject hereto to do,
either directly or indirectly through any subsidiary, any
act, including the making of any loan or investment, or
to own, possess, or carry as assets any property that if
done by or owned, possessed, or carried by the State bank
would be in violation of or prohibited by any provision
of this Act.
The provisions of this subsection (12) shall not apply to
and shall not be deemed to limit the powers of a State bank
with respect to the ownership, possession, and carrying of
stock that a State bank is permitted to own, possess, or
carry under this Act.
Any bank intending to establish a subsidiary under this
subsection (12) shall give written notice to the Commissioner
60 days prior to the subsidiary's commencing of business or,
as the case may be, prior to acquiring stock in a corporation
that has already commenced business. After receiving the
notice, the Commissioner may waive or reduce the balance of
the 60 day notice period. The Commissioner may specify the
form of the notice and may promulgate rules and regulations
to administer this subsection (12).
(13) To accept for payment at a future date not
exceeding one year from the date of acceptance, drafts drawn
upon it by its customers; and to issue, advise, or confirm
letters of credit authorizing the holders thereof to draw
drafts upon it or its correspondents.
(14) To own and lease personal property acquired by the
bank at the request of a prospective lessee and upon the
agreement of that person to lease the personal property
provided that the lease, the agreement with respect thereto,
and the amount of the investment of the bank in the property
comply with Section 35.1 of this Act.
(15) (a) To establish and maintain, in addition to the
main banking premises, branches offering any banking services
permitted at the main banking premises of a State bank.
(b) To establish and maintain, after May 31, 1997,
branches in another state that may conduct any activity in
that state that is authorized or permitted for any bank that
has a banking charter issued by that state, subject to the
same limitations and restrictions that are applicable to
banks chartered by that state.
(16) (Blank).
(17) To establish and maintain terminals, as authorized
by the Electronic Fund Transfer Act.
(18) To establish and maintain temporary service booths
at any International Fair held in this State which is
approved by the United States Department of Commerce, for the
duration of the international fair for the sole purpose of
providing a convenient place for foreign trade customers at
the fair to exchange their home countries' currency into
United States currency or the converse. This power shall not
be construed as establishing a new place or change of
location for the bank providing the service booth.
(19) To indemnify its officers, directors, employees,
and agents, as authorized for corporations under Section 8.75
of the Business Corporation Act of 1983.
(20) To own, possess, and carry as assets stock of, or
be or become a member of, any corporation, mutual company,
association, trust, or other entity formed exclusively for
the purpose of providing directors' and officers' liability
and bankers' blanket bond insurance or reinsurance to and for
the benefit of the stockholders, members, or beneficiaries,
or their assets or businesses, or their officers, directors,
employees, or agents, and not to or for the benefit of any
other person or entity or the public generally.
(21) To make debt or equity investments in corporations
or projects, whether for profit or not for profit, designed
to promote the development of the community and its welfare,
provided that the aggregate investment in all of these
corporations and in all of these projects does not exceed 10%
of the unimpaired capital and unimpaired surplus of the bank
and provided that this limitation shall not apply to
creditworthy loans by the bank to those corporations or
projects. Upon written application to the Commissioner, a
bank may make an investment that would, when aggregated with
all other such investments, exceed 10% of the unimpaired
capital and unimpaired surplus of the bank. The Commissioner
may approve the investment if he is of the opinion and finds
that the proposed investment will not have a material adverse
effect on the safety and soundness of the bank.
(22) To own, possess, and carry as assets the stock of a
corporation engaged in the ownership or operation of a travel
agency or to operate a travel agency as a part of its
business, provided that the bank either owned, possessed, and
carried as assets the stock of such a corporation or operated
a travel agency as part of its business before July 1, 1991.
(23) With respect to affiliate facilities:
(a) to conduct at affiliate facilities any of the
following transactions for and on behalf of another
commonly owned bank, if so authorized by the other bank:
receiving deposits; cashing and issuing checks, drafts,
and money orders; changing money; and receiving payments
on existing indebtedness; and
(b) to authorize a commonly owned bank to conduct
for and on behalf of it any of the transactions listed in
this paragraph (23) at one or more affiliate facilities.
Any bank intending to conduct or to authorize a commonly
owned bank to conduct at an affiliate facility any of the
transactions specified in this paragraph (23) shall give
written notice to the Commissioner at least 30 days before
any such transaction is conducted at the affiliate facility.
(24) To act as the agent for any fire, life, or other
insurance company authorized by the State of Illinois, by
soliciting and selling insurance and collecting premiums on
policies issued by such company; and to may receive for
services so rendered such fees or commissions as may be
agreed upon between the said bank and the insurance company
for which it may act as agent; provided, however, that no
such bank shall in any case assume or guarantee the payment
of any premium on insurance policies issued through its
agency by its principal; and provided further, that the bank
shall not guarantee the truth of any statement made by an
assured in filing his application for insurance.
(25) Notwithstanding any other provisions of this Act or
any other law, to offer any product or service that is at the
time authorized or permitted to any insured savings
association by applicable law, provided that powers conferred
only by this subsection (25):
(a) shall always be subject to the same limitations
and restrictions that are applicable to the insured
savings association for the product or service by such
applicable law;
(b) shall be subject to applicable provisions of
the Financial Institutions Insurance Sales Law;
(c) shall not include the right to own or conduct a
real estate brokerage business for which a license would
be required under the laws of this State; and
(d) shall not be construed to include the
establishment or maintenance of a branch, nor shall they
be construed to limit the establishment or maintenance of
a branch pursuant to subsection (11).
(Source: P.A. 89-208, eff. 9-29-95; 89-310, eff. 1-1-96;
89-364, eff. 8-18-95; 89-626, eff. 8-9-96; 90-41, eff.
10-1-97; 90-301, eff. 8-1-97; revised 10-22-97.)
(205 ILCS 5/9) (from Ch. 17, par. 316)
Sec. 9. Contents of application. The application for a
permit to organize shall be in a form specified by the
Commissioner and shall be filed with the Commissioner signed
by each of the applicants and shall be acknowledged before
some officer authorized by law to acknowledge deeds. It shall
state:
(1) The name, residence, business or occupation and
address of each applicant, and a statement of the proposed
management;
(2) The name for the proposed bank;
(3) The location of the proposed bank;
(4) The amount of capital and, surplus and reserve for
operating expenses for the proposed bank;
(5) The number of shares of capital stock, the number of
shares and classes of preferred stock, if any, the par value
of the capital stock and preferred stock, and the amount for
which each share of capital stock and preferred stock is to
be sold;
(6) A statement of the financial worth of each of the
applicants;
(7) (Blank);
(8) Such other relevant information as the Commissioner
may require.
(Source: P.A. 90-301, eff. 8-1-97.)
(205 ILCS 5/10) (from Ch. 17, par. 317)
Sec. 10. Permit to organize. Upon the filing of an
application for a permit to organize, the Commissioner shall
investigate the truth of the statements therein and shall
consider the proposed bank's capital structure, its future
earnings prospects, the general character, experience, and
qualifications of its proposed management, its proposed plan
of operation, and the convenience and needs of the area
sought to be served and notwithstanding the provisions of
Section 7 of this Act, the Commissioner shall not approve the
application and issue a permit to organize unless he shall be
of the opinion and finds:
(1) That the proposed capital at least meets the minimum
requirements of this Act determined by the Commissioner
pursuant to Section 7 of this Act including additional
capital necessitated by the circumstances of the proposed
bank including its size, scope of operations and market in
which it proposes to operate;
(2) That the future earnings prospects are favorable;
(3) That the general character, experience, and
qualifications of its proposed management and its proposed
plan of operation are is such as to assure reasonable promise
of successful, safe and sound operation;
(4) That the name of the proposed bank is not the same
as or deceptively similar to the name of any other bank then
operating in this State; and
(5) That the convenience and needs of the area sought to
be served by the proposed bank will be promoted.
(Source: P.A. 86-368.)
(205 ILCS 5/13) (from Ch. 17, par. 320)
Sec. 13. Issuance of charter.
(a) When the directors have organized as provided in
Section 12 of this Act, and the capital stock and the
preferred stock, if any, together with a surplus of not less
than 50% of the capital, has been all fully paid in and a
record of the same filed with the Commissioner, the
Commissioner or some competent person of the Commissioner's
appointment shall make a thorough examination into the
affairs of the proposed bank, and if satisfied (i) that all
the requirements of this Act have been complied with, (ii)
and that no intervening circumstance has occurred to change
the Commissioner's findings made pursuant to Section 10 of
this Act, and (iii) that the prior involvement by any
stockholder who will own a sufficient amount of stock to have
control, as defined in Section 18 of this Act, of the
proposed bank with any other financial institution, whether
as stockholder, director, officer, or customer, was conducted
in a safe and sound manner, upon payment into the
Commissioner's office of the reasonable expenses of the
examination, as determined by the Commissioner, the
Commissioner shall issue a charter authorizing the bank to
commence business as authorized in this Act. All charters
issued by the Commissioner or any predecessor agency which
chartered State banks, including any charter outstanding as
of September 1, 1989, shall be perpetual. For the 2 years
after the Commissioner has issued a charter to a bank, the
bank shall request and obtain from the Commissioner prior
written approval before it may change senior management
personnel or directors.
The original charter, duly certified by the Commissioner,
or a certified copy shall be evidence in all courts and
places of the existence and authority of the bank to do
business. Upon the issuance of the charter by the
Commissioner, the bank shall be deemed fully organized and
may proceed to do business. The Commissioner may, in the
Commissioner's discretion, withhold the issuing of the
charter when the Commissioner has reason to believe that the
bank is organized for any purpose other than that
contemplated by this Act or that a commission or fee has been
paid in connection with the sale of the stock of the bank.
The Commissioner shall revoke the charter and order
liquidation in the event that the bank does not commence a
general banking business within one year from the date of the
issuance of the charter, unless a request has been submitted,
in writing, to the Commissioner for an extension and the
request has been approved. After commencing a general
banking business, a bank, upon written notice to the
Commissioner, may change its name.
(b) (1) The Commissioner may also issue a charter to a
bank that is owned exclusively by other depository
institutions or depository institution holding companies and
is organized to engage exclusively in providing services to
or for other depository institutions, their holding
companies, and the officers, directors, and employees of such
institutions and companies, and in providing correspondent
banking services at the request of other depository
institutions or their holding companies (also referred to as
a "bankers' bank").
(2) A bank chartered pursuant to paragraph (1) shall,
except as otherwise specifically determined by the
Commissioner, be vested with the same rights and privileges
and subject to the same duties, restrictions, penalties, and
liabilities now or hereafter imposed under this Act.
(c) A bank chartered under this Act after November 1,
1985, and an out-of-state bank that merges with a State bank
and establishes or maintains a branch in this State after May
31, 1997, shall obtain from and, at all times while it
accepts or retains deposits, maintain with the Federal
Deposit Insurance Corporation, or such other instrumentality
of or corporation chartered by the United States, deposit
insurance as authorized under federal law.
(d) (i) A bank that has a banking charter issued by the
Commissioner under this Act may, pursuant to a written
purchase and assumption agreement, transfer substantially all
of its assets to another State bank or national bank in
consideration, in whole or in part, for the transferee banks'
assumption of any part or all of its liabilities. Such a
transfer shall in no way be deemed to impair the charter of
the transferor bank or cause the transferor bank to forfeit
any of its rights, powers, interests, franchises, or
privileges as a State bank, nor shall any voluntary reduction
in the transferor bank's activities resulting from the
transfer have any such effect; provided, however, that a
State bank that transfers substantially all of its assets
pursuant to this subsection (d) and following the transfer
does not accept deposits and make loans, shall not have any
rights, powers, interests, franchises, or privileges under
subsection (15) of Section 5 of this Act until the bank has
resumed accepting deposits and making loans.
(ii) The fact that a State bank does not resume
accepting deposits and making loans for a period of 24 months
commencing on September 11, 1989 or on a date of the transfer
of substantially all of a State bank's assets, whichever is
later, or such longer period as the Commissioner may allow in
writing, may be the basis for a finding by the Commissioner
under Section 51 of this Act that the bank is unable to
continue operations.
(iii) The authority provided by subdivision (i) of this
subsection (d) shall terminate on May 31, 1997, and no bank
that has transferred substantially all of its assets pursuant
to this subsection (d) shall continue in existence after May
31, 1997.
(Source: P.A. 89-208, eff. 9-29-95; 89-567, eff. 7-26-96;
89-603, eff. 8-2-96; 90-14, eff. 7-1-97; 90-301, eff.
8-1-97.)
(205 ILCS 5/21.1)
Sec. 21.1. Application for certificate of authority.
(a) On or after June 1, 1997, an out-of-state bank may,
in order to procure a certificate of authority to merge with
a State bank after executing, shall execute and filing file
in duplicate not less than 60 days before the proposed
effective date of the merger an application therefor with the
Commissioner and after shall also filing with the
Commissioner file a copy of its charter, articles of
association or articles of incorporation, and all amendments
thereto, duly authenticated by the proper officer of the
state wherein it is chartered or incorporated and the last
quarterly statement of condition filed by the out-of-state
bank with the appropriate federal banking regulator. The
Commissioner shall specify the form of the application which
shall set forth, to the extent applicable, the same
information required in an application by a foreign
corporation pursuant to Section 13.15 of the Business
Corporation Act of 1983. Subject to Sections 21.2 and 21.3 of
this Act, receipt by the Commissioner of a copy of an
application filed with and approved by the out-of-state
bank's chartering authority authorizing the out-of-state bank
to merge with a State bank shall satisfy the filing
requirements of this subsection (a).
When the provisions of this Section have been complied
with, the Commissioner shall issue a certificate of authority
to merge. If the merger is not consummated within one year,
the Commissioner may cancel the certificate of authority.
(b) An out-of-state bank that is the resulting bank in a
merger with a State bank may, after the merger, establish and
maintain a branch or branches in Illinois at the locations
where the State bank had its main office and branches
immediately before the merger.
(c) An out-of-state bank that establishes and maintains
a branch or branches in Illinois pursuant to subsection (b)
of this Section may, after the merger, establish and maintain
additional branches in this State to the same extent as a
State bank.
(d) A branch of an out-of-state bank may not conduct any
activity that is not authorized for a State bank.
(e) An out-of-state bank shall provide written notice to
the Commissioner of its intent to establish an additional
branch or branches in this State within 30 days after
approval of the appropriate federal banking agency to
establish the branch or branches. The notice form shall be
specified by the Commissioner and may include any of the
information required for a similar notice by a State bank.
Receipt by the Commissioner of notice of the out-of-state
bank's intent to establish such additional branch or branches
in this State from the out-of-state bank's chartering
authority shall satisfy the requirements of this subsection
(e).
(Source: P.A. 89-208, eff. 9-29-95.)
(205 ILCS 5/24) (from Ch. 17, par. 331)
Sec. 24. Effective date of merger; filing. The executed
merger agreement together with copies of the resolutions of
the stockholders of each merging bank or insured savings
association approving it, certified by the bank's or insured
savings association's president or vice-president or the
cashier, shall be filed with the Commissioner. A merger that
is to result in a State bank shall, unless a later date is
specified in the agreement, become effective when the
Commissioner has approved the agreement and issued a
certificate of merger to the continuing bank. The charters of
the merging banks or insured savings association, other than
the continuing bank, shall thereupon automatically terminate.
If, after May 31, 1997, the merger will result in an
out-of-state bank, the charter of a merging State bank shall
terminate upon notice to the Commissioner that the merger is
effective. The certificate of merger shall specify the name
of each merging bank or insured savings association and the
name of the continuing bank, and the amendments to the
charter of the continuing bank provided for by the merger
agreement. The certificate shall be conclusive evidence of
the merger and of the correctness of all proceedings therefor
in all courts and places, and the certificate shall be
recorded.
(Source: P.A. 89-208, eff. 9-29-95.)
(205 ILCS 5/48) (from Ch. 17, par. 359)
Sec. 48. Commissioner's powers; duties. The Commissioner
shall have the powers and authority, and is charged with the
duties and responsibilities designated in this Act, and a
State bank shall not be subject to any other visitorial power
other than as authorized by this Act, except those vested in
the courts, or upon prior consultation with the Commissioner,
a foreign bank regulator with an appropriate supervisory
interest in the parent or affiliate of a state bank. In the
performance of the Commissioner's duties:
(1) The Commissioner shall call for statements from all
State banks as provided in Section 47 at least one time
during each calendar quarter.
(2) (a) The Commissioner, as often as the Commissioner
shall deem necessary or proper, and no less frequently than
18 months following the preceding examination, shall appoint
a suitable person or persons to make an examination of the
affairs of every State bank, except that for every eligible
State bank, as defined by regulation, the Commissioner in
lieu of the examination may accept on an alternating basis
the examination made by the eligible State bank's appropriate
federal banking agency pursuant to Section 111 of the Federal
Deposit Insurance Corporation Improvement Act of 1991,
provided the appropriate federal banking agency has made such
an examination. A person so appointed shall not be a
stockholder or officer or employee of any bank which that
person may be directed to examine, and shall have powers to
make a thorough examination into all the affairs of the bank
and in so doing to examine any of the officers or agents or
employees thereof on oath and shall make a full and detailed
report of the condition of the bank to the Commissioner. In
making the examination the examiners shall include an
examination of the affairs of all the affiliates of the bank,
as defined in subsection (b) of Section 35.2 of this Act, as
shall be necessary to disclose fully the conditions of the
affiliates, the relations between the bank and the affiliates
and the effect of those relations upon the affairs of the
bank, and in connection therewith shall have power to examine
any of the officers, directors, agents, or employees of the
affiliates on oath. After May 31, 1997, the Commissioner may
enter into cooperative agreements with state regulatory
authorities of other states to provide for examination of
State bank branches in those states, and the Commissioner may
accept reports of examinations of State bank branches from
those state regulatory authorities. These cooperative
agreements may set forth the manner in which the other state
regulatory authorities may be compensated for examinations
prepared for and submitted to the Commissioner.
(b) After May 31, 1997, the Commissioner is authorized
to examine, as often as the Commissioner shall deem necessary
or proper, branches of out-of-state banks. The Commissioner
may establish and may assess fees to be paid to the
Commissioner for examinations under this subsection (b). The
fees shall be borne by the out-of-state bank, unless the fees
are borne by the state regulatory authority that chartered
the out-of-state bank, as determined by a cooperative
agreement between the Commissioner and the state regulatory
authority that chartered the out-of-state bank.
(2.5) Whenever any State bank, any subsidiary or
affiliate of a State bank, or after May 31, 1997, any branch
of an out-of-state bank causes to be performed, by contract
or otherwise, any bank services for itself, whether on or off
its premises:
(a) that performance shall be subject to
examination by the Commissioner to the same extent as if
services were being performed by the bank or, after May
31, 1997, branch of the out-of-state bank itself on its
own premises; and
(b) the bank or, after May 31, 1997, branch of the
out-of-state bank shall notify the Commissioner of the
existence of a service relationship. The notification
shall be submitted with the first statement of condition
(as required by Section 47 of this Act) due after the
making of the service contract or the performance of the
service, whichever occurs first. The Commissioner shall
be notified of each subsequent contract in the same
manner.
For purposes of this subsection (2.5), the term "bank
services" means services such as sorting and posting of
checks and deposits, computation and posting of interest and
other credits and charges, preparation and mailing of checks,
statements, notices, and similar items, or any other
clerical, bookkeeping, accounting, statistical, or similar
functions performed for a State bank, including but not
limited to electronic data processing related to those bank
services.
(3) The expense of administering this Act, including the
expense of the examinations of State banks as provided in
this Act, shall to the extent of the amounts resulting from
the fees provided for in paragraphs (a), (a-2), and (b) of
this subsection (3) be assessed against and borne by the
State banks:
(a) Each bank shall pay to the Commissioner a Call
Report Fee which shall be paid in quarterly installments
equal to one-fourth of the sum of the annual fixed fee of
$800, plus a variable fee based on the assets shown on
the quarterly statement of condition delivered to the
Commissioner in accordance with Section 47 for the
preceding quarter according to the following schedule:
16¢ per $1,000 of the first $5,000,000 of total assets,
15¢ per $1,000 of the next $20,000,000 of total assets,
13¢ per $1,000 of the next $75,000,000 of total assets,
9¢ per $1,000 of the next $400,000,000 of total assets,
7¢ per $1,000 of the next $500,000,000 of total assets,
and 5¢ per $1,000 of all assets in excess of
$1,000,000,000, of the State bank. The Call Report Fee
shall be calculated by the Commissioner and billed to the
banks for remittance at the time of the quarterly
statements of condition provided for in Section 47. The
Commissioner may require payment of the fees provided in
this Section by an electronic transfer of funds or an
automatic debit of an account of each of the State banks.
In case more than one examination of any bank is deemed
by the Commissioner to be necessary in any examination
frequency cycle specified in subsection 2(a) of this
Section, and is performed at his direction, the
Commissioner may assess a reasonable additional fee to
recover the cost of the additional examination. In lieu
of the method and amounts set forth in this paragraph (a)
for the calculation of the Call Report Fee, the
Commissioner may specify by rule that the Call Report
Fees provided by this Section may be assessed
semiannually or some other period and may provide in the
rule the formula to be used for calculating and assessing
the periodic Call Report Fees to be paid by State banks.
(a-1) If in the opinion of the Commissioner an
emergency exists or appears likely, the Commissioner may
assign an examiner or examiners to monitor the affairs of
a State bank with whatever frequency he deems
appropriate, including but not limited to a daily basis.
The reasonable and necessary expenses of the Commissioner
during the period of the monitoring shall be borne by the
subject bank. The Commissioner shall furnish the State
bank a statement of time and expenses if requested to do
so within 30 days of the conclusion of the monitoring
period.
(a-2) On and after January 1, 1990, the reasonable
and necessary expenses of the Commissioner during
examination of the performance of electronic data
processing services under subsection (2.5) shall be borne
by the banks for which the services are provided. An
amount, based upon a fee structure prescribed by the
Commissioner, shall be paid by the banks or, after May
31, 1997, branches of out-of-state banks receiving the
electronic data processing services along with the Call
Report Fee assessed under paragraph (a) of this
subsection (3).
(a-3) After May 31, 1997, the reasonable and
necessary expenses of the Commissioner during examination
of the performance of electronic data processing services
under subsection (2.5) at or on behalf of branches of
out-of-state banks shall be borne by the out-of-state
banks, unless those expenses are borne by the state
regulatory authorities that chartered the out-of-state
banks, as determined by cooperative agreements between
the Commissioner and the state regulatory authorities
that chartered the out-of-state banks.
(b) "Fiscal year" for purposes of this Section 48
is defined as a period beginning July 1 of any year and
ending June 30 of the next year. The Commissioner shall
receive for each fiscal year, commencing with the fiscal
year ending June 30, 1987, a contingent fee equal to the
lesser of the aggregate of the fees paid by all State
banks under paragraph (a) of subsection (3) for that
year, or the amount, if any, whereby the aggregate of the
administration expenses, as defined in paragraph (c), for
that fiscal year exceeds the sum of the aggregate of the
fees payable by all State banks for that year under
paragraph (a) of subsection (3), plus all other amounts
collected by the Commissioner for that year under any
other provision of this Act, plus the aggregate of all
fees collected for that year by the Commissioner under
the Corporate Fiduciary Act, excluding the receivership
fees provided for in Section 5-10 of the Corporate
Fiduciary Act, and the Foreign Banking Office Act. The
aggregate amount of the contingent fee thus arrived at
for any fiscal year shall be apportioned amongst,
assessed upon, and paid by the State banks and foreign
banking corporations, respectively, in the same
proportion that the fee of each under paragraph (a) of
subsection (3), respectively, for that year bears to the
aggregate for that year of the fees collected under
paragraph (a) of subsection (3). The aggregate amount of
the contingent fee, and the portion thereof to be
assessed upon each State bank and foreign banking
corporation, respectively, shall be determined by the
Commissioner and shall be paid by each, respectively,
within 120 days of the close of the period for which the
contingent fee is computed and is payable, and the
Commissioner shall give 20 days advance notice of the
amount of the contingent fee payable by the State bank
and of the date fixed by the Commissioner for payment of
the fee.
(c) The "administration expenses" for any fiscal
year shall mean the ordinary and contingent expenses for
that year incident to making the examinations provided
for by, and for otherwise administering, this Act, the
Corporate Fiduciary Act, excluding the expenses paid from
the Corporate Fiduciary Receivership account in the Bank
and Trust Company Fund, the Foreign Banking Office Act,
the Electronic Fund Transfer Act, and the Illinois Bank
Examiners' Education Foundation Act, including all
salaries and other compensation paid for personal
services rendered for the State by officers or employees
of the State, including the Commissioner and the Deputy
Commissioners, all expenditures for telephone and
telegraph charges, postage and postal charges, office
stationery, supplies and services, and office furniture
and equipment, including typewriters and copying and
duplicating machines and filing equipment, surety bond
premiums, and travel expenses of those officers and
employees, employees, expenditures or charges for the
acquisition, enlargement or improvement of, or for the
use of, any office space, building, or structure, or
expenditures for the maintenance thereof or for
furnishing heat, light, or power with respect thereto,
all to the extent that those expenditures are directly
incidental to such examinations or administration. The
Commissioner shall not be required by paragraphs (c) or
(d-1) of this subsection (3) to maintain in any fiscal
year's budget appropriated reserves for accrued vacation
and accrued sick leave that is required to be paid to
employees of the Commissioner upon termination of their
service with the Commissioner in an amount that is more
than is reasonably anticipated to be necessary for any
anticipated turnover in employees, whether due to normal
attrition or due to layoffs, terminations, or
resignations.
(d) The aggregate of all fees collected by the
Commissioner under this Act, the Corporate Fiduciary Act,
or the Foreign Banking Office Act on and after July 1,
1979, shall be paid promptly after receipt of the same,
accompanied by a detailed statement thereof, into the
State treasury and shall be set apart in a special fund
to be known as the "Bank and Trust Company Fund", except
as provided in paragraph (c) of subsection (11) of this
Section. The amount from time to time deposited into the
Bank and Trust Company Fund shall be used to offset the
ordinary administrative expenses of the Commissioner of
Banks and Real Estate as defined in this Section. Nothing
in this amendatory Act of 1979 shall prevent continuing
the practice of paying expenses involving salaries,
retirement, social security, and State-paid insurance
premiums of State officers by appropriations from the
General Revenue Fund. However, the General Revenue Fund
shall be reimbursed for those payments made on and after
July 1, 1979, by an annual transfer of funds from the
Bank and Trust Company Fund.
(d-1) Adequate funds shall be available in the Bank
and Trust Company Fund to permit the timely payment of
administration expenses. In each fiscal year the total
administration expenses shall be deducted from the total
fees collected by the Commissioner and the remainder
transferred into the Cash Flow Reserve Account, unless
the balance of the Cash Flow Reserve Account prior to the
transfer equals or exceeds one-fourth of the total
initial appropriations from the Bank and Trust Company
Fund for the subsequent year, in which case the remainder
shall be credited to State banks and foreign banking
corporations and applied against their fees for the
subsequent year. The amount credited to each State bank
and foreign banking corporation shall be in the same
proportion as the Call Report Fees paid by each for the
year bear to the total Call Report Fees collected for the
year. If, after a transfer to the Cash Flow Reserve
Account is made or if no remainder is available for
transfer, the balance of the Cash Flow Reserve Account is
less than one-fourth of the total initial appropriations
for the subsequent year and the amount transferred is
less than 5% of the total Call Report Fees for the year,
additional amounts needed to make the transfer equal to
5% of the total Call Report Fees for the year shall be
apportioned amongst, assessed upon, and paid by the State
banks and foreign banking corporations in the same
proportion that the Call Report Fees of each,
respectively, for the year bear to the total Call Report
Fees collected for the year. The additional amounts
assessed shall be transferred into the Cash Flow Reserve
Account. For purposes of this paragraph (d-1), the
calculation of the fees collected by the Commissioner
shall exclude the receivership fees provided for in
Section 5-10 of the Corporate Fiduciary Act.
(e) The Commissioner may upon request certify to
any public record in his keeping and shall have authority
to levy a reasonable charge for issuing certifications of
any public record in his keeping.
(f) In addition to fees authorized elsewhere in
this Act, the Commissioner may, in connection with a
review, approval, or provision of a service, levy a
reasonable charge to recover the cost of the review,
approval, or service.
(4) Nothing contained in this Act shall be construed to
limit the obligation relative to examinations and reports of
any State bank, deposits in which are to any extent insured
by the United States or any agency thereof, nor to limit in
any way the powers of the Commissioner with reference to
examinations and reports of that bank.
(5) The nature and condition of the assets in or
investment of any bonus, pension, or profit sharing plan for
officers or employees of every State bank or, after May 31,
1997, branch of an out-of-state bank shall be deemed to be
included in the affairs of that State bank or branch of an
out-of-state bank subject to examination by the Commissioner
under the provisions of subsection (2) of this Section, and
if the Commissioner shall find from an examination that the
condition of or operation of the investments or assets of the
plan is unlawful, fraudulent, or unsafe, or that any trustee
has abused his trust, the Commissioner shall, if the
situation so found by the Commissioner shall not be corrected
to his satisfaction within 60 days after the Commissioner has
given notice to the board of directors of the State bank or
out-of-state bank of his findings, report the facts to the
Attorney General who shall thereupon institute proceedings
against the State bank or out-of-state bank, the board of
directors thereof, or the trustees under such plan as the
nature of the case may require.
(6) The Commissioner shall have the power:
(a) To promulgate reasonable rules for the purpose
of administering the provisions of this Act.
(b) To issue orders for the purpose of
administering the provisions of this Act and any rule
promulgated in accordance with this Act.
(c) To appoint hearing officers to execute any of
the powers granted to the Commissioner under this Section
for the purpose of administering this Act and any rule
promulgated in accordance with this Act.
(d) To subpoena witnesses, to compel their
attendance, to administer an oath, to examine any person
under oath, and to require the production of any relevant
books, papers, accounts, and documents in the course of
and pursuant to any investigation being conducted, or any
action being taken, by the Commissioner in respect of any
matter relating to the duties imposed upon, or the powers
vested in, the Commissioner under the provisions of this
Act or any rule promulgated in accordance with this Act.
(e) To conduct hearings.
(7) Whenever, in the opinion of the Commissioner, any
director, officer, employee, or agent of a State bank or,
after May 31, 1997, of any branch of an out-of-state bank
shall have violated any law, rule, or order relating to that
bank or shall have engaged in an unsafe or unsound practice
in conducting the business of that bank or shall have
violated any law or engaged or participated in any unsafe or
unsound practice in connection with any financial institution
or other business entity such that the character and fitness
of the director, officer, employee, or agent does not assure
reasonable promise of safe and sound operation of the State
bank, the Commissioner may issue an order of removal. If, in
the opinion of the Commissioner, any former director,
officer, employee, or agent of a State bank, prior to the
termination of his or her service with that bank, violated
any law, rule, or order relating to that State bank or
engaged in an unsafe or unsound practice in conducting the
business of that bank or violated any law or engaged or
participated in any unsafe or unsound practice in connection
with any financial institution or other business entity such
that the character and fitness of the director, officer,
employee, or agent would not have assured reasonable promise
of safe and sound operation of the State bank prior to the
termination of his or her service with that bank, the
Commissioner may issue an order prohibiting that person from
further service with a bank as a director, officer, employee,
or agent. An order issued pursuant to this subsection shall
be served upon the director, officer, employee, or agent. A
copy of the order shall be sent to each director of the bank
affected by registered mail. The person affected by the
action may request a hearing before the State Banking Board
within 10 days after receipt of the order of removal. The
hearing shall be held by the Board within 30 days after the
request has been received by the Board. The Board shall make
a determination approving, modifying, or disapproving the
order of the Commissioner as its final administrative
decision. If a hearing is held by the Board, the Board shall
make its determination within 60 days from the conclusion of
the hearing. Any person affected by a decision of the Board
under this subsection (7) of Section 48 of this Act may have
the decision reviewed only under and in accordance with the
Administrative Review Law and the rules adopted pursuant
thereto. A copy of the order shall also be served upon the
bank of which he is a director, officer, employee, or agent,
whereupon he shall cease to be a director, officer, employee,
or agent of that bank. The Commissioner may institute a
civil action against the director, officer, or agent of the
State bank or, after May 31, 1997, of the branch of the
out-of-state bank against whom any order provided for by this
subsection (7) of this Section 48 has been issued, and
against the State bank or, after May 31, 1997, out-of-state
bank, to enforce compliance with or to enjoin any violation
of the terms of the order. Any person who has been the
subject of an order of removal or an order of prohibition
issued by the Commissioner under this subsection or Section
5-6 of the Corporate Fiduciary Act may not thereafter serve
as director, officer, employee, or agent of any State bank or
of any branch of any out-of-state bank, or of any corporate
fiduciary, as defined in Section 1-5.05 of the Corporate
Fiduciary Act, or of any other entity that is subject to
licensure or regulation by the Commissioner or the Office of
Banks and Real Estate unless the Commissioner has granted
prior approval in writing.
(8) The Commissioner may impose civil penalties of up to
$10,000 against any person for each violation of any
provision of this Act, any rule promulgated in accordance
with this Act, any order of the Commissioner, or any other
action which in the Commissioner's discretion is an unsafe or
unsound banking practice.
(9) The Commissioner may impose civil penalties of up to
$100 against any person for the first failure to comply with
reporting requirements set forth in the report of examination
of the bank and up to $200 for the second and subsequent
failures to comply with those reporting requirements.
(10) All final administrative decisions of the
Commissioner hereunder shall be subject to judicial review
pursuant to the provisions of the Administrative Review Law.
For matters involving administrative review, venue shall be
in either Sangamon County or Cook County.
(11) The endowment fund for the Illinois Bank Examiners'
Education Foundation shall be administered as follows:
(a) (Blank).
(b) The Foundation is empowered to receive
voluntary contributions, gifts, grants, bequests, and
donations on behalf of the Illinois Bank Examiners'
Education Foundation from national banks and other
persons for the purpose of funding the endowment of the
Illinois Bank Examiners' Education Foundation.
(c) The aggregate of all special educational fees
collected by the Commissioner and property received by
the Commissioner on behalf of the Illinois Bank
Examiners' Education Foundation under this subsection
(11) on or after June 30, 1986, shall be either (i)
promptly paid after receipt of the same, accompanied by a
detailed statement thereof, into the State Treasury and
shall be set apart in a special fund to be known as "The
Illinois Bank Examiners' Education Fund" to be invested
by either the Treasurer of the State of Illinois in the
Public Treasurers' Investment Pool or in any other
investment he is authorized to make or by the Illinois
State Board of Investment as the board of trustees of the
Illinois Bank Examiners' Education Foundation may direct
or (ii) deposited into an account maintained in a
commercial bank or corporate fiduciary in the name of the
Illinois Bank Examiners' Education Foundation pursuant to
the order and direction of the Board of Trustees of the
Illinois Bank Examiners' Education Foundation.
(12) (Blank).
(Source: P.A. 89-208, eff. 9-29-95; 89-317, eff. 8-11-95;
89-508, eff. 7-3-96; 89-567, eff. 7-26-96; 89-626, eff.
8-9-96; 90-14, eff. 7-1-97; 90-301, eff. 8-1-97.)
(205 ILCS 5/48.1) (from Ch. 17, par. 360)
Sec. 48.1. Customer financial records; confidentiality.
(a) For the purpose of this Section, the term "financial
records" means any original, any copy, or any summary of (1)
a document granting signature authority over a deposit or
account, (2) a statement, ledger card or other record on any
deposit or account, which shows each transaction in or with
respect to that account, (3) a check, draft or money order
drawn on a bank or issued and payable by a bank, or (4) any
other item containing information pertaining to any
relationship established in the ordinary course of a bank's
business between a bank and its customer.
(b) This Section does not prohibit:
(1) The preparation, examination, handling or
maintenance of any financial records by any officer,
employee or agent of a bank having custody of the
records, or the examination of the records by a certified
public accountant engaged by the bank to perform an
independent audit.
(2) The examination of any financial records by, or
the furnishing of financial records by a bank to, any
officer, employee or agent of (i) the Commissioner of
Banks and Real Estate, (ii) after May 31, 1997, a state
regulatory authority authorized to examine a branch of a
State bank located in another state, (iii) the
Comptroller of the Currency, (iv) the Federal Reserve
Board, or (v) the Federal Deposit Insurance Corporation
for use solely in the exercise of his duties as an
officer, employee, or agent.
(3) The publication of data furnished from
financial records relating to customers where the data
cannot be identified to any particular customer or
account.
(4) The making of reports or returns required under
Chapter 61 of the Internal Revenue Code of 1986.
(5) Furnishing information concerning the dishonor
of any negotiable instrument permitted to be disclosed
under the Uniform Commercial Code.
(6) The exchange in the regular course of business
of credit information between a bank and other banks or
financial institutions or commercial enterprises,
directly or through a consumer reporting agency.
(7) The furnishing of information to the
appropriate law enforcement authorities where the bank
reasonably believes it has been the victim of a crime.
(8) The furnishing of information under the Uniform
Disposition of Unclaimed Property Act.
(9) The furnishing of information under the
Illinois Income Tax Act and the Illinois Estate and
Generation-Skipping Transfer Tax Act.
(10) The furnishing of information under the
federal Currency and Foreign Transactions Reporting Act
Title 31, United States Code, Section 1051 et seq.
(11) The furnishing of information under any other
statute that by its terms or by regulations promulgated
thereunder requires the disclosure of financial records
other than by subpoena, summons, warrant, or court order.
(12) The furnishing of information about the
existence of an account of a person to a judgment
creditor of that person who has made a written request
for that information.
(13) The exchange in the regular course of business
of information between commonly owned banks in connection
with a transaction authorized under paragraph (23) of
Section 5 and conducted at an affiliate facility.
(14) The furnishing of information in accordance
with the federal Personal Responsibility and Work
Opportunity Reconciliation Act of 1996. Any bank governed
by this Act shall enter into an agreement for data
exchanges with a State agency provided the State agency
pays to the bank a reasonable fee not to exceed its
actual cost incurred. A bank providing information in
accordance with this item shall not be liable to any
account holder or other person for any disclosure of
information to a State agency, for encumbering or
surrendering any assets held by the bank in response to a
lien or order to withhold and deliver issued by a State
agency, or for any other action taken pursuant to this
item, including individual or mechanical errors, provided
the action does not constitute gross negligence or
willful misconduct. A bank shall have no obligation to
hold, encumber, or surrender assets until it has been
served with a subpoena, summons, warrant, court or
administrative order, lien, or levy.
(15) The exchange in the regular course of business
of information between a bank and any commonly owned
affiliate of the bank, subject to the provisions of the
Financial Institutions Insurance Sales Law.
(c) A bank may not disclose to any person, except to the
customer or his duly authorized agent, any financial records
relating to that customer of that bank unless:
(1) the customer has authorized disclosure to the
person;
(2) the financial records are disclosed in response
to a lawful subpoena, summons, warrant or court order
which meets the requirements of subsection (d) of this
Section; or
(3) the bank is attempting to collect an obligation
owed to the bank and the bank complies with the
provisions of Section 2I of the Consumer Fraud and
Deceptive Business Practices Act.
(d) A bank shall disclose financial records under
paragraph (2) of subsection (c) of this Section under a
lawful subpoena, summons, warrant, or court order only after
the bank mails a copy of the subpoena, summons, warrant, or
court order to the person establishing the relationship with
the bank, if living, and, otherwise his personal
representative, if known, at his last known address by first
class mail, postage prepaid, unless the bank is specifically
prohibited from notifying the person by order of court or by
applicable State or federal law. A bank shall not mail a
copy of a subpoena to any person pursuant to this subsection
if the subpoena was issued by a grand jury under the
Statewide Grand Jury Act.
(e) Any officer or employee of a bank who knowingly and
willfully furnishes financial records in violation of this
Section is guilty of a business offense and, upon conviction,
shall be fined not more than $1,000.
(f) Any person who knowingly and willfully induces or
attempts to induce any officer or employee of a bank to
disclose financial records in violation of this Section is
guilty of a business offense and, upon conviction, shall be
fined not more than $1,000.
(g) A bank shall be reimbursed for costs that are
reasonably necessary and that have been directly incurred in
searching for, reproducing, or transporting books, papers,
records, or other data of a customer required or requested to
be produced pursuant to a lawful subpoena, summons, warrant,
or court order. The Commissioner shall determine the rates
and conditions under which payment may be made.
(Source: P.A. 89-208, eff. 9-29-95; 89-364, eff. 8-18-95;
89-508, eff. 7-3-96; 89-626, eff. 8-9-96; 90-18, eff.
7-1-97.)
Section 15. The Savings Bank Act is amended by changing
Sections 1006, 1008, 6001, 6003, and 6013 as follows:
(205 ILCS 205/1006) (from Ch. 17, par. 7301-6)
Sec. 1006. Parity.
(a) Subject to the regulation of the Commissioner and in
addition to the powers granted by this Act, each savings
bank operating under this Act shall possess those powers
granted by regulation promulgated under the Federal Deposit
Insurance Act for state savings banks.
(b) A savings bank may establish branches or offices at
which savings or investments are regularly received or loans
approved as follows:
(1) to the extent branch powers and offices are
granted to State banks under the Illinois Banking Act;
(2) within the geographic area defined in Article 2
of this Act and subject to the provisions of Article 2 of
this Act;
(3) within the same geographic areas or states as
those states from which a holding company is permitted to
acquire an Illinois savings bank or an Illinois savings
bank holding company;
(4) to the same extent that holding companies and
savings and loan associations headquartered outside the
State of Illinois are allowed to operate in Illinois by
virtue of Articles 1A and 2B of the Illinois Savings and
Loan Act of 1985;
(5) as the result of mergers, consolidations, or
bulk sales of facilities in the case of relocations.
(c) The Commissioner may adopt regulations that provide
for the establishment of branches as defined by the
Commissioner.
(d) Notwithstanding any other provision of this Act, a
savings bank that purchases or assumes all or any part of the
assets or liabilities of a bank, savings bank, or savings and
loan association or merges or consolidates with a bank,
savings bank, or savings and loan association may retain and
maintain the main premises or branches of the former bank,
savings bank, or savings and loan association as branches of
the purchasing, merging, or consolidating savings bank,
provided it assumes the deposit liabilities of the bank,
savings bank, or savings and loan association maintained at
the main premises or branches.
(e) A savings bank has any power reasonably incident,
convenient, or useful to the accomplishment of the express
powers conferred upon the savings bank by this Act.
(Source: P.A. 89-74, eff. 6-30-95; 90-301, eff. 8-1-97.)
(205 ILCS 205/1008) (from Ch. 17, par. 7301-8)
Sec. 1008. General corporate powers.
(a) A savings bank operating under this Act shall be a
body corporate and politic and shall have all of the specific
powers conferred by this Act and in addition thereto, the
following general powers:
(1) To sue and be sued, complain, and defend in its
corporate name and to have a common seal, which it may
alter or renew at pleasure.
(2) To obtain and maintain insurance by a deposit
insurance corporation as defined in this Act.
(3) To act as a fiscal agent for the United States,
the State of Illinois or any department, branch, arm, or
agency of the State or any unit of local government or
school district in the State, when duly designated for
that purpose, and as agent to perform reasonable
functions as may be required of it.
(4) To become a member of or deal with any
corporation or agency of the United States or the State
of Illinois, to the extent that the agency assists in
furthering or facilitating its purposes or powers and to
that end to purchase stock or securities thereof or
deposit money therewith, and to comply with any other
conditions of membership or credit.
(5) To make donations in reasonable amounts for the
public welfare or for charitable, scientific, religious,
or educational purposes.
(6) To adopt and operate reasonable insurance,
bonus, profit sharing, and retirement plans for officers
and employees and for directors including, but not
limited to, advisory, honorary, and emeritus directors,
who are not officers or employees.
(7) To reject any application for membership; to
retire deposit accounts by enforced retirement as
provided in this Act and the bylaws; and to limit the
issuance of, or payments on, deposit accounts, subject,
however, to contractual obligations.
(8) To purchase stock in service corporations and
to invest in any form of indebtedness of any service
corporation as defined in this Act, subject to
regulations of the Commissioner.
(9) To purchase stock of a corporation whose
principal purpose is to operate a safe deposit company or
escrow service company.
(10) To exercise all the powers necessary to
qualify as a trustee or custodian under federal or State
law, provided that the authority to accept and execute
trusts is subject to the provisions of the Corporate
Fiduciary Act and to the supervision of those activities
by the Commissioner of Banks and Real Estate.
(11) (Blank).
(12) To establish, maintain, and operate terminals
as authorized by the Electronic Fund Transfer Act. The
establishment, maintenance, operation, and location of
those terminals shall be subject to the approval of the
Commissioner.
(13) Pledge its assets:
(A) to enable it to act as agent for the sale
of obligations of the United States;
(B) to secure deposits;
(C) to secure deposits of money whenever
required by the National Bankruptcy Act;
(D) to qualify under Section 2-9 of the
Corporate Fiduciary Act; and
(E) to secure trust funds commingled with the
savings bank's funds, whether deposited by the
savings bank or an affiliate of the savings bank, as
required under Section 2-8 of the Corporate
Fiduciary Act.
(14) To accept for payment at a future date not to
exceed one year from the date of acceptance, drafts drawn
upon it by its customers; and to issue, advise, or
confirm letters of credit authorizing holders thereof to
draw drafts upon it or its correspondents.
(15) Subject to the regulations of the
Commissioner, to own and lease personal property acquired
by the savings bank at the request of a prospective
lessee and, upon the agreement of that person, to lease
the personal property.
(16) To establish temporary service booths at any
International Fair in this State that is approved by the
United States Department of Commerce for the duration of
the international fair for the purpose of providing a
convenient place for foreign trade customers to exchange
their home countries' currency into United States
currency or the converse. To provide temporary periodic
service to persons residing in a bona fide nursing home,
senior citizens' retirement home, or long-term care
facility. These powers shall not be construed as
establishing a new place or change of location for the
savings bank providing the service booth.
(17) To indemnify its officers, directors,
employees, and agents, as authorized for corporations
under Section 8.75 of the Business Corporations Act of
1983.
(18) To provide data processing services to others
on a for-profit basis.
(19) To utilize any electronic technology to
provide customers with home banking services.
(20) Subject to the regulations of the
Commissioner, to enter into an agreement to act as a
surety.
(21) Subject to the regulations of the
Commissioner, to issue credit cards, extend credit
therewith, and otherwise engage in or participate in
credit card operations.
(22) To purchase for its own account shares of
stock of a bankers' bank, described in Section 13(b)(1)
of the Illinois Banking Act, on the same terms and
conditions as a bank may purchase such shares. In no
event shall the total amount of such stock held by a
savings bank in such bankers' bank exceed 10% of its
capital and surplus (including undivided profits) and in
no event shall a savings bank acquire more than 5% of any
class of voting securities of such bankers' bank.
(23) With respect to affiliate facilities:
(A) to conduct at affiliate facilities any of
the following transactions for and on behalf of any
affiliated depository institution, if so authorized
by the affiliate or affiliates: receiving deposits;
renewing deposits; cashing and issuing checks,
drafts, money orders, travelers checks, or similar
instruments; changing money; receiving payments on
existing indebtedness; and conducting ministerial
functions with respect to loan applications,
servicing loans, and providing loan account
information; and
(B) to authorize an affiliated depository
institution to conduct for and on behalf of it, any
of the transactions listed in this subsection at one
or more affiliate facilities.
A savings bank intending to conduct or to authorize
an affiliated depository institution to conduct at an
affiliate facility any of the transactions specified in
this subsection shall give written notice to the
Commissioner at least 30 days before any such transaction
is conducted at an affiliate facility. All conduct under
this subsection shall be on terms consistent with safe
and sound banking practices and applicable law.
(24) (23) Subject to Article XLIV of the Illinois
Insurance Code, to act as the agent for any fire, life,
or other insurance company authorized by the State of
Illinois, by soliciting and selling insurance and
collecting premiums on policies issued by such company;
and may receive for services so rendered such fees or
commissions as may be agreed upon between the said
savings bank and the insurance company for which it may
act as agent; provided, however, that no such savings
bank shall in any case assume or guarantee the payment of
any premium on insurance policies issued through its
agency by its principal; and provided further, that the
savings bank shall not guarantee the truth of any
statement made by an assured in filing his application
for insurance.
(25) (23) To become a member of the Federal Home
Loan Bank Board and to have the powers granted to a
savings association organized under the Illinois Savings
and Loan Act of 1985 or the laws of the United States,
subject to regulations of the Commissioner.
(26) To offer any product or service that is at the
time authorized or permitted to a bank by applicable law,
but subject always to the same limitations and
restrictions that are applicable to the bank for the
product or service by such applicable law and subject to
the applicable provisions of the Financial Institutions
Insurance Sales Law and rules of the Commissioner.
(b) If this Act or the regulations adopted under this
Act fail to provide specific guidance in matters of corporate
governance, the provisions of the Business Corporation Act of
1983 may be used.
(Source: P.A. 89-74, eff. 6-30-95; 89-310, eff. 1-1-96;
89-317, eff. 8-11-95; 89-355, eff. 8-17-95; 89-508, eff.
7-3-96; 89-603, eff. 8-2-96; 89-626, eff. 8-9-96; 90-14, eff.
7-1-97; 90-41, eff. 10-1-97; 90-270, eff. 7-30-97; 90-301,
eff. 8-1-97; revised 10-21-97.)
(205 ILCS 205/6001) (from Ch. 17, par. 7306-1)
Sec. 6001. General provisions.
(a) No savings bank shall make any loan or investment
authorized by this Article unless the savings bank first has
determined that the type, amount, purpose, and repayment
provisions of the loan or investment in relation to the
borrower's or issuer's resources and credit standing support
the reasonable belief that the loan or investment will be
financially sound and will be repaid according to its terms
and that the loan or investment is not otherwise unlawful.
(b) Each loan or investment that a savings bank makes or
purchases, whether wholly or in part, must be adequately
underwritten, reviewed periodically, and reserved against as
necessary in accordance with its payment performance, all in
accordance with the regulations and directives of the
Commissioner.
(c) Every appraisal or reappraisal of property that a
savings bank is required to make shall be made as follows:
(1) By an independent qualified appraiser,
designated by the board of directors, who is properly
licensed or and certified by the entity authorized to
govern his licensure or and certification and who meets
the requirements of the Appraisal Subcommittee and of the
Federal Act.
(2) In the case of an insured or guaranteed loan,
by any appraiser appointed by any lending, insuring, or
guaranteeing agency of the United States or the State of
Illinois that insures or guarantees the loan, wholly or
in part.
(3) Each appraisal shall be in writing prepared at
the request of the lender for the lender's use; disclose
the market value of the security offered; contain
sufficient information and data concerning the appraised
property to substantiate the market value thereof; be
certified and signed by the appraiser or appraisers; and
state that the appraiser or appraisers have personally
examined the described property. The appraisal shall be
filed and preserved by the savings bank. In addition, the
appraisal shall be prepared and reported in accordance
with the Standards of Professional Practice and the
ethical rules of the Appraisal Foundation as adopted and
promulgated by the Appraisal Subcommittee.
(d) If appraisals of real estate securing a savings
bank's loans are obtained as part of an examination by the
Commissioner, the cost of those appraisals shall promptly be
paid by the savings bank directly to the appraiser or
appraisers.
(e) Any violation of this Article shall constitute an
unsafe or unsound practice. Any person who knowingly
violates any provision of this Article shall be subject to
enforcement action or civil money penalties as provided for
in this Act.
(f) For purposes of this Article, "underwriting" shall
mean the process of compiling information to support a
determination as to whether an investment or extension of
credit shall be made by a savings bank. It shall include,
but not be limited to, evaluating a borrower's
creditworthiness, determination of the value of the
underlying collateral, market factors, and the
appropriateness of the investment or loan for the savings
bank. Underwriting as used herein does not include the
agreement to purchase unsold portions of public offerings of
stocks or bonds as commonly used in corporate securities
issuances and sales.
(g) For purposes of this Section, the following
definitions shall apply:
(1) "Federal Act" means Title XI of the Financial
Institutions Reform, Recovery and Enforcement Act of 1989
and regulations adopted pursuant thereto.
(2) "Appraisal Subcommittee" means the designee of
the heads of the Federal Financial Institutions
Examination Council Act of 1978 (12 U.S.C. 3301 et seq.).
(3) "Appraisal Foundation" means the Appraisal
Foundation that was incorporated as an Illinois
not-for-profit corporation on November 30, 1987.
(Source: P.A. 86-1213.)
(205 ILCS 205/6003) (from Ch. 17, par. 7306-3)
Sec. 6003. Other investments. If the board of directors
determines at any time that funds are available in excess of
the demands and needs for loans, maturities, and withdrawals,
A savings bank may invest funds as provided in this Section:
(1) In demand, time, or savings deposits or
accounts, withdrawable accounts, or other insured
obligations of any financial institution the accounts of
which are insured by a federal agency.
(2) In participating interests in loans of a type
that the savings bank would be authorized to make, but
only if the other participants are (A) savings banks
organized under this Act, (B) savings and loan
associations, banks, credit unions, and licensees under
the Consumer Installment Loan Act or the Sales Finance
Agency Act, organized under the laws of this State, (C)
associations or corporations insured by an
instrumentality of the United States, (D)
instrumentalities of or corporations owned wholly or in
part by the United States or this State, or, (E) subject
to regulations of the Commissioner, service corporations
of a savings bank organized under this Act or
subsidiaries of a savings and loan association, bank, or
credit union organized under the laws of this State or
the United States.
(3) In obligations of, or obligations that are
fully guaranteed by the United States and in stocks or
obligations of any Federal Reserve Bank, Federal Home
Loan Bank, the Student Loan Market Association, the
Government National Mortgage Association, the Federal
National Mortgage Association, The Federal Home Loan
Mortgage Corporation, the Federal Deposit Insurance
Corporation, or any other agency of the United States.
(4) In bonds or other direct obligations of, or
guaranteed as to principal and interest by, this State.
(5) In obligations that by the laws of this State
are made legal investments for savings banks.
(6) In bonds or other evidences of indebtedness
that are direct general obligations of any unit of local
government of this State or in bonds or other evidences
of indebtedness that are payable from revenues or
earnings specifically pledged therefor of a unit of local
government, but in no event shall the total amount of the
securities of any one maker or obligor exceed 15% of the
savings bank's total capital, nor shall the aggregate
amount of investments under this paragraph exceed 15% of
the savings bank's total assets.
(7) Equity investments in real estate. With the
prior written consent of the Commissioner, a savings bank
may invest in the initial purchase and development, or
the purchase or commitment to purchase after completion,
of home sites and housing for sale or rental, including,
but not limited to, projects for the reconstruction,
rehabilitation, or rebuilding of residential properties
to meet the minimum standards of health and occupancy
prescribed by appropriate local authorities, the
provision of accommodations for retail stores, shops, and
other community services that are reasonably incident to
that housing or in the shares of a corporation that owns
one or more of those projects and that is wholly owned by
one or more financial institutions whose investments are
regulated by the laws of this State or of the United
States. In no event shall the total investment in any
one project exceed 15% of the savings bank's total
capital, nor shall the aggregate investment under this
paragraph exceed 50% of its total capital. No savings
bank may make an investment of this type unless it is in
compliance with the capital requirements of this Act and
with the capital maintenance requirements of its insurer
of deposit accounts. The Commissioner shall approve the
investment only if the savings bank shows:
(A) that the savings bank has adequate assets
available for the investment;
(B) that the proposed investment does not
exceed the reasonable market value of the property
or interest therein as determined in accordance with
the appraisal requirements of this Act; and
(C) that all other requirements of this
Section have been met.
Nothing contained in this paragraph prohibits a
savings bank from developing or building on land acquired
by it under any other provision of this Act nor from
completing the construction of buildings in accordance
with any construction loan contract where the borrower
has failed to comply with the terms of the contract.
(8) In obligations of the State of Israel or
obligations fully guaranteed by the State of Israel as to
payment of principal and interest, but in no event shall
the total amount of that investment exceed 15% of the
savings bank's total capital.
(9) In stocks or obligations of business
development corporations chartered by this State or by
the United States or an agency thereof, but in no event
shall the aggregate amount of stock exceed 2.5% of the
savings bank's total capital or $250,000, whichever is
greater.
(10) In obligations of urban renewal investment
corporations chartered under the laws of this State, or
the United States, or in certificates of beneficial
interest of urban renewal investment trusts, but in no
event shall the aggregate amount of the stock,
obligations or beneficial interest certificates of any
one maker exceed 2.5% of the savings bank's total
capital, nor shall the aggregate amount of investments
under this paragraph exceed 15% of its total capital.
(11) Subject to the regulations of the
Commissioner, in loans deemed sufficiently secured by the
board of directors of the savings bank. However, if the
security is stock or equity securities of any kind other
than those of a financial institution, the stock or
securities must be listed on a national exchange or
actively traded and quoted on an over-the-counter market
or their value must be ascertainable in accordance with
regulations promulgated by the Commissioner.
(12) In commercial paper. As used in this Section,
the term "commercial paper" means short term obligations
having a maturity ranging from 2 to 270 days issued by
banks, corporations, or other borrowers. Investments in
commercial paper under this Section must be in securities
rated in one of the 4 highest categories by a nationally
recognized rating service.
(13) Purchase of stock in insurance companies.
Notwithstanding any provision of this Act to the
contrary, a savings bank may purchase shares of, or
otherwise acquire equity interests in, insurance
companies and insurance holding companies organized to
provide insurance for savings institutions and
corporations and individuals affiliated with savings
institutions, provided ownership of equity interests is a
prerequisite to obtaining directors and officers' and
blanket bond insurance through the company or companies.
The Commissioner may promulgate regulations concerning
the size of each savings bank's investment and manner of
holding those investments.
(14) Subject to the regulation of the Commissioner,
in equity or debt securities or instruments of a service
corporation subsidiary of the savings bank.
(15) Through advances of federal funds to
designated depositories, provided that the advances are
made on the condition that they be repaid on the next
business day following the date on which the advance is
made. For the purposes of this paragraph, the term
"federal funds" means funds that a savings bank has on
deposit at a depository that are exchangeable for funds
on deposit at a federal reserve bank; the term "business
day" means any day on which the savings bank, the
depository, and the federal reserve bank where the funds
are on deposit are all open for general business.
(16) In financial futures or options transactions
subject to the regulations of the Commissioner.
(17) In a subsidiary chartered for the purpose of
exercising all powers necessary to act as a corporate
fiduciary under the Corporate Fiduciary Act.
(18) In marketable investment securities, but in no
event shall the total amount of those securities of any
one maker or obligor exceed 15% of the savings bank's
total capital nor shall the aggregate amount of
investments under this Section exceed 15% of total
assets. As used in this Section, the term "marketable
investment securities" does not include stocks, but means
investment grade marketable obligations evidencing
indebtedness of any person in the form of bonds, notes,
or debentures commonly known as investment securities,
and of a type customarily sold on recognized exchanges or
traded over the counter and investment grade marketable
obligations of the International Bank for Reconstruction
and Development, the Inter-American Development Bank, the
Asian Development Bank, the African Development Bank, or
the International Finance Corporation. As used in this
Section, the term "investment grade" means being rated in
one of the 4 highest categories by at least one
nationally recognized rating service.
(19) In investment grade marketable obligations of
any other state, territory, or possession or political
subdivision thereof to the same extent that it may invest
in marketable investment securities under paragraph (18)
of this Section.
(Source: P.A. 88-481; 89-317, eff. 8-11-95.)
(205 ILCS 205/6013) (from Ch. 17, par. 7306-13)
Sec. 6013. Loans to one borrower.
(a) Except as provided in subsection (c), the total
loans and extensions of credit, both direct and indirect, by
a savings bank to any person, other than a municipal
corporation for money borrowed, outstanding at one time shall
not exceed 20% of the savings bank's total capital plus
general loan loss reserves.
(b) Except as provided in subsection (c), the total
loans and extensions of credit, both direct and indirect, by
a savings bank to any person outstanding at one time and at
least 100% secured by readily marketable collateral having a
market value, as determined by reliable and continuously
available price quotations, shall not exceed 10% of the
savings bank's total capital plus general loan loss reserves.
This limitation shall be separate from and in addition to the
limitation contained in subsection (a).
(c) If the limit under subsection (a) or (b) on total
loans to one borrower is less than $500,000, a savings bank
that meets its minimum capital requirement under this Act may
have loan and extensions of credit, both direct and indirect,
outstanding to any person at one time not to exceed $500,000.
With the prior written approval of the Commissioner, a
savings bank that has capital in excess of 6% of assets may
make loans and extensions of credit to one borrower for the
development of residential housing properties, located or to
be located in this State, not to exceed 30% of the savings
bank's total capital plus general loan loss reserves.
(d) For purposes of this Section, the term "person"
shall be deemed to include an individual, firm, corporation,
business trust, partnership, trust, estate, association,
joint venture, pool, syndicate, sole proprietorship,
unincorporated association, any political subdivision, or any
similar entity or organization.
(e) For the purposes of this Section any loan or
extension of credit granted to one person, the proceeds of
which are used for the direct benefit of a second person,
shall be deemed a loan or extension of credit to the second
person as well as the first person.
(f) For the purposes of this Section, the total
liabilities of a firm, partnership, pool, syndicate, or joint
venture shall include the liabilities of the members of the
entity.
(g) For the purposes of this Section, the term "readily
marketable collateral" means financial instruments or bullion
that are salable under ordinary circumstances with reasonable
promptness at a fair market value on an auction or a
similarly available daily bid-and-ask price market.
"Financial instruments" include stocks, bonds, notes,
debentures traded on a national exchange or over the counter,
commercial paper, negotiable certificates of deposit,
bankers' acceptances, and shares in money market or mutual
funds.
(h) Each savings bank shall institute adequate
procedures to ensure that collateral fully secures the
outstanding loan or extension of credit at all times.
(i) If collateral values fall below 100% of the
outstanding loan or extension of credit to the extent that
the loan or extension of credit no longer is in conformance
with subsection (b) and exceeds the 20% limitation of
subsection (a), the loan must be brought into conformance
with this Section within 5 business days except where
judicial proceedings or other similar extraordinary
occurrences prevent the savings bank from taking action.
(j) This Section shall not apply to loans or extensions
of credit to the United States of America or its agencies or
this State or its agencies or to any loan, investment, or
extension of credit made pursuant to Section 6003 of this
Act.
(Source: P.A. 89-74, eff. 6-30-95.)
Section 20. The Illinois Credit Union Act is amended by
changing Sections 1.1 and 61 and adding Section 34.1 as
follows:
(205 ILCS 305/1.1) (from Ch. 17, par. 4402)
Sec. 1.1. Definitions. Credit Union - The term "credit
union" means a cooperative, non-profit association,
incorporated under this Act, under the laws of the United
States of America or under the laws of another state, for the
purposes of encouraging thrift among its members, creating a
source of credit at a reasonable rate of interest, and
providing an opportunity for its members to use and control
their own money in order to improve their economic and social
conditions. The membership of a credit union shall consist of
a group or groups each having a common bond as set forth in
this Act.
Common Bond - The term "common bond" refers to groups of
people who meet one of the following qualifications:
(1) Persons belonging to a specific association, group
or organization, such as a church, labor union, club or
society and members of their immediate families which shall
include any relative by blood or marriage or foster and
adopted children.
(2) Persons who reside in a reasonably compact and well
defined neighborhood or community, and members of their
immediate families which shall include any relative by blood
or marriage or foster and adopted children.
(3) Persons who have a common employer or who are
members of an organized labor union or an organized
occupational or professional group within a defined
geographical area, and members of their immediate families
which shall include any relative by blood or marriage or
foster and adopted children.
Shares - The term "shares" or "share accounts" means any
form of shares issued by a credit union and established by a
member in accordance with standards specified by a credit
union, including but not limited to common shares, share
draft accounts, classes of shares, share certificates,
special purpose share accounts, shares issued in trust,
custodial accounts, and individual retirement accounts or
other plans established pursuant to Section 401(d) or (f) or
Section 408(a) of the Internal Revenue Code, as now or
hereafter amended, or similar provisions of any tax laws of
the United States that may hereafter exist.
Credit Union Organization - The term "credit union
organization" means any organization established to serve the
needs of credit unions, the business of which relates to the
daily operations of credit unions.
Department - The term "Department" means the Illinois
Department of Financial Institutions.
Director - The term "Director" means the Director of the
Illinois Department of Financial Institutions.
NCUA - The term "NCUA" means the National Credit Union
Administration, an agency of the United States Government
charged with the supervision of credit unions chartered under
the laws of the United States of America.
Central Credit Union - The term "central credit union"
means a credit union incorporated primarily to receive shares
from and make loans to credit unions and Directors, Officers,
committee members and employees of credit unions. A central
credit union may also accept as members persons who were
members of credit unions which were liquidated and persons
from occupational groups not otherwise served by another
credit union.
Corporate Credit Union - The term "corporate credit
union" means a credit union which is a cooperative,
non-profit association, the membership of which is limited
primarily to other credit unions.
Insolvent - "Insolvent" means the condition that results
when the total of all liabilities and shares exceeds net
assets of the credit union.
Danger of insolvency - The term "Danger of insolvency" as
used in Section 61 means when a credit union falls below a 2%
capital to asset ratio.
(Source: P.A. 86-432.)
(205 ILCS 305/34.1 new)
Sec. 34.1. Compliance review.
(a) As used in this Section:
"Affiliate" means an organization established to serve
the needs of credit unions, the business of which relates to
the daily operations of credit unions.
"Compliance review committee" means:
(1) one or more persons appointed by the board of
directors or supervisory committee of a credit union for
the purposes set forth in subsection (b); or
(2) any other person to the extent the person acts
in an investigatory capacity at the direction of a
compliance review committee.
"Compliance review documents" means documents prepared in
connection with a review or evaluation conducted by or for a
compliance review committee.
"Person means an individual, a group of individuals, a
board committee, a partnership, a firm, an association, a
corporation, or any other entity.
(b) This Section applies to compliance review committees
whose functions are to evaluate and seek to improve any of
the following:
(1) loan policies or underwriting standards;
(2) asset quality;
(3) financial reporting to federal or State
governmental or regulatory agencies; or
(4) compliance with federal or State statutory or
regulatory requirements.
(c) Except as provided in subsection (d), compliance
review documents and the deliberations of the compliance
review committee are privileged and confidential and are
nondiscoverable and nonadmissible.
(1) Compliance review documents are privileged and
confidential and are not subject to discovery or
admissible in evidence in any civil action.
(2) Individuals serving on compliance review
committees or acting under the direction of a compliance
review committee shall not be required to testify in any
civil action about the contents of any compliance review
document or conclusions of any compliance review
committee or about the actions taken by a compliance
review committee.
(3) An affiliate of a credit union, a credit union
regulatory agency, and the insurer of credit union share
accounts shall have access to compliance review
documents, provided that (i) the documents shall remain
confidential and are not subject to discovery from such
entity and (ii) delivery of compliance review documents
to an affiliate or pursuant to the requirements of a
credit union regulatory agency or an insurer of credit
union share accounts shall not constitute a waiver of the
privilege granted in this Section.
(d) This Section does not apply to: (1) compliance
review committees on which individuals serving on or at the
direction of the compliance review committee have management
responsibility for the operations, records, employees, or
activities being examined or evaluated by the compliance
review committee and (2) any civil or administrative action
initiated by a credit union regulatory agency or an insurer
of credit union share accounts.
(e) This Section shall not be construed to limit the
discovery or admissibility in any civil action of any
documents other than compliance review documents or to
require the appointment of a compliance review committee.
(205 ILCS 305/61) (from Ch. 17, par. 4462)
Sec. 61. Suspension.
(1) If the Director determines that any credit union is
bankrupt, insolvent, impaired or that it has willfully
violated this Act, or is operating in an unsafe or unsound
manner, he shall issue an order temporarily suspending the
credit union's operations for not more than 60 days. The
Board of Directors shall be given notice by registered or
certified mail of such suspension, which notice shall include
the reasons for such suspension and a list of specific
violations of the Act, or a list of the specific violations
of this Act, or both such reasons and list. The Director
shall also notify the members of the Credit Union Board of
Advisors of any suspension. The Director may assess to the
credit union a penalty, not to exceed the examination fee as
set forth in this Act, $50 to offset costs incurred in
determining the condition of the credit union's books and
records.
(2) Upon receipt of such suspension notice, the credit
union shall cease all operations, except those authorized by
the Director, or the Director may appoint a Manager-Trustee
to operate the credit union during the suspension period.
The Board of Directors shall, within 10 days of the receipt
of the suspension notice, file with the Director a reply to
the suspension notice, either by submitting one or more of
the following: a corrective plan of action or a request for
formal hearing on said action pursuant to the Department's
rules and regulations. or by a request that the credit union
be declared insolvent and a Liquidating Agent be appointed.
(3) Upon receipt from the suspended credit union of
evidence that the conditions causing the order of suspension
have been corrected, and after determining that the proposed
corrective plan of action submitted is factual, the Director
shall revoke the suspension notice, permit the credit union
to resume normal operations, and notify the Board of Credit
Union Advisors of such action.
(4) If the Director determines that the proposed
corrective plan of action will not correct such conditions
and that the credit union cannot be reorganized, he may take
possession and control of the credit union its office,
furniture, fixtures, books, records and other assets and upon
examination, determine whether it is practicable and feasible
to reorganize the credit union to continue its business. The
Director may permit the credit union to operate under his
direction and control, and may appoint a Manager-Trustee to
manage its affairs until such time as the condition requiring
such action has been remedied, or in the case of insolvency
or danger of insolvency where an emergency requiring
expeditious action exists, the Director may involuntarily
merge the credit union without the vote of the suspended
credit union's Board of Directors or members (hereafter
involuntary merger) subject to rules promulgated by the
Director. No credit union shall be required to serve as a
surviving credit union in any involuntary merger. Upon the
request of the Director, a credit union by a vote of a
majority of its Board of Directors may elect to serve as a
surviving credit union in an involuntary merger. If the
Director he determines that the suspended credit union should
be liquidated, he may appoint a Liquidating Agent and require
of that person such bond and security as he considers proper.
(5) Upon receipt of a request for a formal hearing, the
Director shall conduct proceedings pursuant to rules and
regulations of the Department and take necessary action
subsequent to the hearing officer's decision; whether it be
revocation of the suspension notice, issuance of an
involuntary liquidation or appointment of a Manager-Trustee..
The credit union may request the appropriate court to stay
execution of such action. Involuntary liquidation or
involuntary merger may not be ordered prior to the conclusion
of suspension procedures outlined in this Section.
(6) If, within the suspension period, the credit union
fails to answer the suspension notice or fails to request a
formal hearing, or both, the Director may then (i)
involuntarily merge the credit union if the credit union is
insolvent or in danger of insolvency and an emergency
requiring expeditious action exists or (ii) revoke the credit
union's charter, appoint a Liquidating Agent and liquidate
the credit union.
(Source: P.A. 86-432.)
Section 25. The Electronic Fund Transfer Act is amended
by adding Section 85 as follows:
(205 ILCS 616/85 new)
Sec. 85. Reliance on Commissioner. No person shall be
liable under this Act for any act done or omitted in good
faith in conformity with any rule, interpretation, or opinion
issued by the Commissioner of Banks and Real Estate,
notwithstanding that after the act or omission has occurred,
the rule, interpretation, or opinion upon which reliance is
placed is amended, rescinded, or determined by judicial or
other authority to be invalid for any reason.
Section 30. The Corporate Fiduciary Act is amended by
changing Sections 1-7, 4-4, and 5-6 as follows:
(205 ILCS 620/1-7) (from Ch. 17, par. 1551-7)
Sec. 1-7. Office locations corporate fiduciaries.
(a) Any corporate fiduciary may establish branch offices
at any location. Any corporate fiduciary that seeks to
establish a branch office shall, if it is a trust company,
apply for and obtain approval for the branch office from the
Commissioner or, if it is a bank, savings and loan
association, or savings bank, give notice of its intent to
establish a branch office to the Commissioner, 30 days prior
to the purchasing or leasing of land, building, or equipment
for the branch office under the terms and conditions as the
Commissioner shall specify by rule.
(b) Any trust company that proposes to establish a
subsidiary, whether by incorporating the subsidiary or by
acquiring the subsidiary, shall apply for and obtain prior
approval from the Commissioner 60 days prior to commencing
business by the subsidiary, if newly incorporated, or prior
to its acquisition, if it is acquired, provided the
Commissioner may specify circumstances and conditions when a
trust company may directly or indirectly acquire a subsidiary
without prior approval.
(Source: P.A. 86-754; 87-506.)
(205 ILCS 620/4-4) (from Ch. 17, par. 1554-4)
Sec. 4-4. Place of business not to be established in
State; not deemed transacting business.
(a) A foreign corporation, as defined in Section 1-5.08
of this Act, shall not establish in this State a place of
business, branch office, or agency for the conduct of
business as a fiduciary and because it is not permitted to
establish in this State a place of business, branch office or
agency, a foreign corporation insofar as it acts in a
fiduciary capacity in this State pursuant to the provisions
of this Act shall not be deemed to be transacting business in
this State. The foreign corporation may apply for, and
procure from the Commissioner, a license to establish a
representative office pursuant to the Foreign Bank
Representative Office Act.
(b) Notwithstanding subsection (a) of this Section 4-4,
after May 31, 1997, a branch of an out-of-state bank, as
defined in Section 2 of the Illinois Banking Act, may
establish an office in this State for the conduct of business
as a fiduciary, provided:; (i) the branch of the out-of-state
bank obtains a certificate of authority pursuant to this
Section; (ii) fiduciary business conducted in this State by a
branch of an out-of-state bank is subject to examination by
the Commissioner; and (ii) (iii) the trust activities of the
branch of the out-of-state bank are subject to regulation,
including enforcement actions, by the Commissioner to the
same extent as Illinois corporate fiduciaries.
(c) The application for a certificate of authority
pursuant to this Section shall be filed with the Commissioner
on forms prescribed by the Commissioner and shall contain
such relevant information as the Commissioner may specify to
determine that the fiduciary business will be conducted by
the branch of the out-of-state bank in a safe and sound
manner.
(Source: P.A. 89-208, eff. 9-29-95; 89-364, eff. 8-18-95;
89-626, eff. 8-9-96.)
(205 ILCS 620/5-6) (from Ch. 17, par. 1555-6)
Sec. 5-6. Removal orders. Whenever, in the opinion of
the Commissioner, any director, officer, employee, or agent
of a corporate fiduciary shall have violated any law, rule,
or order relating to the corporate fiduciary, or shall have
engaged in an unsafe or unsound practice in conducting the
business of the corporate fiduciary, or shall have violated
any law or engaged or participated in any unsafe or unsound
practice in connection with any financial institution or
other business entity such that the character and fitness of
the director, officer, employee, or agent does not assure
reasonable promise of safe and sound operation of the
corporate fiduciary, the Commissioner may issue an order of
removal. If in the opinion of the Commissioner, any former
director, officer, employee, or agent of a corporate
fiduciary, prior to the termination of his or her service
with the corporate fiduciary, violated any law, rule, or
order relating to the corporate fiduciary or engaged in an
unsafe or unsound practice in conducting the business of the
corporate fiduciary or violated any law or engaged or
participated in any unsafe or unsound practice in connection
with any financial institution or other business entity such
that the character and fitness of the director, officer,
employee, or agent would not have assured reasonable promise
of safe and sound operation of the corporate fiduciary prior
to the termination of his or her service with the corporate
fiduciary, the Commissioner may issue an order prohibiting
that person from further service with a corporate fiduciary
as a director, officer, employee, or agent. An order issued
pursuant to this Section shall be served upon the director,
officer, employee, or agent. A copy of the order shall be
sent to each director of the corporate fiduciary affected by
personal service, certified mail return receipt requested, or
any other method that provides proof of service and receipt.
The person affected by the action may request a hearing
before the State Banking Board of Illinois, hereafter "the
Board", within 10 days after receipt of the order of removal
or prohibition. The hearing shall be held by the Board
according to the same procedures used pursuant to Section 48
of the Illinois Banking Act, and the hearing shall be held
within 30 days after the request has been received by the
Board. After concluding the hearing, the Board shall make a
determination approving, modifying, or disapproving the order
of the Commissioner as its final administrative decision. A
copy of the order shall be served upon the corporate
fiduciary of which the person is a director, officer,
employee, or agent, whereupon the person shall cease to be a
director, officer, employee, or agent of the corporate
fiduciary. Any person who has been removed or prohibited by
an order of the Commissioner under this Section or subsection
(7) of Section 48 of the Illinois Banking Act may not
thereafter serve as director, officer, employee, or agent of
any State bank or corporate fiduciary, or of any other entity
that is subject to licensure or regulation by the
Commissioner or the Office of Banks and Real Estate unless
the Commissioner has granted prior approval in writing. The
Commissioner may institute a civil action against the
director, officer, employee, or agent subject to an order
issued under this Section and against the corporate fiduciary
to enforce compliance with or to enjoin any violation of the
terms of the order.
(Source: P.A. 90-301, eff. 8-1-97.)
Section 35. The Consumer Installment Loan Act is amended
by changing Section 19.1 as follows:
(205 ILCS 670/19.1) (from Ch. 17, par. 5425.1)
Sec. 19.1. Where the licensee repossesses a motor vehicle
that was used as collateral and which is used primarily for
the obligor's personal, family or household purposes, the
licensee shall be subject to the requirements of and shall
transfer the certificate of title pursuant to Section 3-114
of the Illinois Vehicle Code and the obligor at the time of
repossession has paid an amount equal to 30% or more of the
total of payments due, the obligor may, within 15 days,
reinstate the contract and recover the motor vehicle from the
licensee by tendering:
(a) the total of all unpaid amounts, including any
unpaid delinquency or deferral charges due, without
acceleration; and
(b) performance necessary to cure any default other than
nonpayment of the amounts due; and
(c) any reasonable cost or fees incurred by the licensee
in the retaking of the goods. Tender of payment and
performance pursuant to this Section restores to the obligor
his rights under the loan as though no default had occurred.
The obligor has a right to reinstate the contract and recover
the collateral from the licensee only once under this
Section.
The licensee must give written notice to the obligor,
within 3 days of the repossession, of the obligor's right to
reinstate the contract and recover the collateral pursuant to
this Section. The Written notice shall be in substantially
the following form:
NOTICE OF RIGHT TO RECOVER VEHICLE
Your car was repossessed on (specify date) for failure to
make payments on the loan (or other reason).
Under Illinois law, because you have paid at least 30% of
the loan before repossession, you may be able to get the car
back. To recover the car and reinstate the loan you must do
the following within 15 days of the date of repossession:
1. Make payment of all back payments as
of the date of this notice
. $...........
2. Pay any late charge due. $...........
3. Pay the costs of repossession. $...........
Total due as of the date of this
notice
plus any additional amounts which may become
due
between the date of the notice and the date of
reinstatement. $...........
Bring cash, a certified check or money order for the
total amount plus any amounts which may become due between
the date of the notice and the date of reinstatement to our
office located at (specify address) by (specify date) to get
your car back.
(Source: P.A. 90-437, eff. 1-1-98.)
Section 45. The Illinois Vehicle Code is amended by
changing Sections 3-114 and 3-117.1 as follows:
(625 ILCS 5/3-114) (from Ch. 95 1/2, par. 3-114)
Sec. 3-114. Transfer by operation of law.
(a) If the interest of an owner in a vehicle passes to
another other than by voluntary transfer, the transferee
shall, except as provided in paragraph (b), promptly mail or
deliver within 20 days to the Secretary of State the last
certificate of title, if available, proof of the transfer,
and his application for a new certificate in the form the
Secretary of State prescribes. It shall be unlawful for any
person having possession of a certificate of title for a
motor vehicle, semi-trailer, or house car by reason of his
having a lien or encumbrance on such vehicle, to fail or
refuse to deliver such certificate to the owner, upon the
satisfaction or discharge of the lien or encumbrance,
indicated upon such certificate of title.
(b) If the interest of an owner in a vehicle passes to
another under the provisions of the Small Estates provisions
of the Probate Act of 1975 the transferee shall promptly mail
or deliver to the Secretary of State, within 120 days, the
last certificate of title, if available, the documentation
required under the provisions of the Probate Act of 1975, and
an application for certificate of title. The Small Estate
Affidavit form shall be furnished by the Secretary of State.
The transfer may be to the transferee or to the nominee of
the transferee.
(c) If the interest of an owner in a vehicle passes to
another under other provisions of the Probate Act of 1975, as
amended, and the transfer is made by a representative or
guardian, such transferee shall promptly mail or deliver to
the Secretary of State, the last certificate of title, if
available, and a certified copy of the letters of office or
guardianship, and an application for certificate of title.
Such application shall be made before the estate is closed.
The transfer may be to the transferee or to the nominee of
the transferee.
(d) If the interest of an owner in joint tenancy passes
to the other joint tenant with survivorship rights as
provided by law, the transferee shall promptly mail or
deliver to the Secretary of State, the last certificate of
title, if available, proof of death of the one joint tenant
and survivorship of the surviving joint tenant, and an
application for certificate of title. Such application shall
be made within 120 days after the death of the joint tenant.
The transfer may be to the transferee or to the nominee of
the transferee.
(e) The Secretary of State shall transfer a decedent's
vehicle title to any legatee, representative or heir of the
decedent who submits to the Secretary a death certificate and
an affidavit by an attorney at law on the letterhead
stationery of the attorney at law stating the facts of the
transfer.
(f) Repossession with assignment of title. In all cases
wherein a lienholder has repossessed a vehicle by other than
judicial process and holds it for resale under a security
agreement, and the owner of record has executed an assignment
of the existing certificate of title after default, the
lienholder may proceed to sell or otherwise dispose of the
vehicle as authorized under the Uniform Commercial Code.
Upon selling the vehicle to another person, the lienholder
need not send the certificate of title to the Secretary of
State, but shall promptly and within 20 days mail or deliver
to the purchaser as transferee the existing certificate of
title for the repossessed vehicle, reflecting the release of
the lienholder's security interest in the vehicle. The
application for a certificate of title made by the purchaser
shall comply with subsection (a) of Section 3-104 and be
accompanied by the existing certificate of title for the
repossessed vehicle. The lienholder shall execute the
assignment and warranty of title showing the name and address
of the purchaser in the spaces provided therefor on the
certificate of title or as the Secretary of State prescribes.
The lienholder shall complete the assignment of title in the
certificate of title to reflect the transfer of the vehicle
to the lienholder and also a reassignment to reflect the
transfer from the lienholder to the purchaser. For this
purpose, the lienholder is specifically authorized to
complete and execute the space reserved in the certificate of
title for a dealer reassignment, notwithstanding that the
lienholder is not a licensed dealer. Nothing herein shall be
construed to mean that the lienholder is taking title to the
repossessed vehicle for purposes of liability for retailer
occupation, vehicle use, or other tax with respect to the
proceeds from the repossession sale. Delivery of the
existing certificate of title to the purchaser shall be
deemed disclosure to the purchaser of the owner of the
vehicle.
(f-5) Repossession without assignment of title. In all
cases wherein a lienholder has repossessed a vehicle by other
than judicial process and holds it for resale under a
security agreement, and the owner of record has not executed
an assignment of the existing certificate of title, the
lienholder shall comply with the following provisions:
(1) Prior to sale, the lienholder shall deliver or
mail to the owner at the owner's last known address and
to any other lienholder of record, a notice of redemption
setting forth the following information: (i) the name of
the owner of record and in bold type at or near the top
of the notice a statement that the owner's vehicle was
repossessed on a specified date for failure to make
payments on the loan (or other reason), (ii) a
description of the vehicle subject to