TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.100 FILINGS
Section 1075.100 Filings
Filings pertaining to matters
named hereafter shall be subject to the indicated fee pursuant to the Savings
Bank Act (the Act) [205 ILCS 205]. Such fee or fees shall be paid at the Department
of Financial and Professional Regulation-Division of Banking (Division) at the
time of filing. Payment shall be by check, draft or money order made payable to
the Department of Financial and Professional Regulation (Department).
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a)
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Permit to Organize
(Section 3001 of the Act)....................................................................................................
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$ 1,000
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b)
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Merger
(Section 8005 of the Act)....................................................................................................
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$ 1,000
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c)
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Sale of Assets
(Section 8010 of the Act)....................................................................................................
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$ 1,000
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d)
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Amendment to Articles of
Incorporation Providing for the Issuance of Permanent Reserve Shares
(Section 5004 of the Act)
(Section 1075.400 of this Part).................................................................................................... ....................................................................................................
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$ 1,000
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e)
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Conversion from Savings Bank
Charter to any Federal Charter
(Section 8001 of the Act)...........................................................
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One times the last total
annual Supervisory Fee calculated and assessed against the Savings Bank as
set forth in Section 1075.130(a) and (b).
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f)
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Hearing or Oral Argument –
each applicant requesting a hearing or oral argument and/or each objector
requesting a hearing or oral argument and/or each adversary participating in
a hearing or oral argument (Section 9018 of the Act, 38 Ill. Adm. Code 100,
and Section 1075.725 of this Part)................
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$ 500
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Each applicant requesting a
hearing or oral argument and/or each objector requesting a hearing or oral
argument and/or each adversary participating in a hearing or oral argument
shall bear its pro rata share of all expense incurred in said proceedings.
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g)
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Application for Subsidiary
Acquisition Fee
(Section 2004 of the Act)...........................................................
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$ 250
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h)
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Conversion from Mutual to
Capital Stock Form of Ownership
(Section 5004 of the Act)
(Subpart O of this Part)....................................................................................................
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$10,000
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i)
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Acquisition of Control of a
Savings Bank
(Sections 5002, 5004 and 5006
of the Act) (Subpart N of this Part)....................................................................................................
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$ 500
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j)
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Photocopy and Duplication Fees
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1)
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Photocopies (per page)........................................................................................
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$ .25
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2)
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Savings Bank Act (bound
edition)........................................................................................
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$ 25
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3)
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Rules (bound edition)........................................................................................
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$ 25
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4)
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Annual Report (additional
copies)........................................................................................
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$ 25
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5)
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Mailing Labels..............................................................
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$ 35
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k)
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Holding Company Registration
Fee
(Section 2002 of the Act)....................................................................................................
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$ 1,000
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l)
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Application for Subsidiary
Acquisition Fee, Illinois Savings Bank Holding Company
(Section 2004 of the Act)....................................................................................................
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$ 250
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m)
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The following fees apply to
mutual holding company transactions:
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1)
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Mutual Holding Company
Reorganization with resulting savings bank stock offered to party other than
the mutual holding company
(Section 2007 of the Act)........................................................................................
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$10,000
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2)
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Mutual Holding Company
Reorganization with no resulting savings bank stock offered to any party
except the mutual holding company
(Section 2007 of the Act)........................................................................................
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$ 3,000
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3)
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Subsequent Offerings:
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A)
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First offering of resulting savings
bank stock to a party other than the mutual holding company after
reorganization described in subsection (m)(2) of this Section.........................................................................
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$ 7,000
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B)
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All other offerings to a party
other than the mutual holding company.........................................................................
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$ 1,000
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4)
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Conversion of Mutual Holding
Company to Stock Holding Company
(Section 2007 of the Act)........................................................................................
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$10,000
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(Source: Amended at 46 Ill.
Reg. 18013, effective October 27, 2022)
 | TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.110 CONDITIONS
Section 1075.110 Conditions
a) No submission subject to a fee shall be considered complete
without the stipulated fee.
b) The fee shall be non-refundable regardless of the subsequent
action with respect to the submission.
c) The Director may waive the payment of the applicable fee
otherwise required by this Section and Section 1075.100 of this Part when:
1) the Director determines that the respective merger or bulk
sale of assets avoids the need for the Director to take custody of the
respective savings bank pursuant to Section 10001 of the Act; or
2) the establishment of a branch office is at the location of the
home office of the savings bank which ceases to exist as the result of a merger
or bulk sale of assets which avoids the need for the Director to take custody
of the respective savings bank pursuant to Section 10001 of the Act; or
3) the termination of operation and closing of a branch office
pertains to a branch office of a savings bank which ceases to exist as the
result of a merger or bulk sale of assets which avoids the need for the Director
to take custody of the respective savings bank pursuant to Section 10001 of the
Act and the closing of the respective branch office is a condition stipulated
in the plan of the respective merger or bulk sale of assets.
d) Should a person desire to submit any information it considers
to be of a confidential nature as part of a submission, such information shall
be separately bound and labeled in capital letters, "CONFIDENTIAL",
and a statement shall be submitted with the bound copy briefly setting forth
the grounds on which such information should be treated as confidential. Only
general reference need be made of that "CONFIDENTIAL" portion in the
portion of the submission that the applicant considers not to be confidential.
If any material has been granted confidential treatment under State or federal
law or by a government agency or a court, those circumstances should be
described. All materials filed are available for inspection, except for
portions that are bound and labeled in capital letters,
"CONFIDENTIAL", and that the Director determines to hold from public
availability because of their confidential nature. The Director's determination
to hold material from public inspection shall be based on considerations of
safety and soundness of the applicant, the propriety nature of the material,
privacy of the applicants or their organization directors, officers, employees
or customers, or on the treatment of the material by other government agencies
or by the courts. The Director will not permit public inspection or copying of
any material that is or would be confidential under State or federal law. The Director
will advise the party filing the submission of any decision to make available
to the public information labeled in capital letters, "CONFIDENTIAL".
It should be understood that it may be necessary for the Director to release
materials previously given confidential treatment. It should be further
understood that even though parts of the submission are considered confidential
as far as public inspection is concerned, the Director may comment on the
confidential portions of submissions, without prior notice, in any public
statement in connection with the Director's decision on the submission.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.120 EXAMINATION FEES (REPEALED)
Section 1075.120 Examination
Fees (Repealed)
(Source: Repealed at 42 Ill.
Reg. 16507, effective August 23, 2018)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.130 REGULATORY FEES
Section 1075.130 Regulatory
Fees
a) Each savings bank shall pay fees as set forth in Section
9002.5(a) of the Act.
b) When service corporations and/or finance subsidiaries are
owned by the savings bank, the owned assets may be consolidated with the assets
of the savings bank for calculation of the fee under Section 9002.5(a) of the
Act.
c) Each savings bank shall pay to the Secretary an electronic
data processing fee equal to 16% of the savings bank's fee set forth in Section
9002.5(a) of the Act. The electronic data processing fee shall be calculated by
the Secretary and billed to the savings bank for remittance with the fee set
forth in Section 9002.5(a) of the Act. Each savings bank shall pay fees as set
forth in Section 9002.5(c) of the Act.
d) If a savings bank has received a Uniform Financial Institution
Rating System (UFIRS) composite rating of 3, 4 or 5 on its last State or
federal examination, the savings bank's quarterly fee shall be increased by 25%
for a 3 rated savings bank and 50% for a 4 or 5 rated savings bank on the
savings bank's subsequent quarter billing. This assessment shall stay in effect
until the quarter following the savings bank's receipt of a UFIRS composite
rating of 1 or 2 at the next State or federal examination.
e) When
a conversion or merger results in a savings bank, and no statement of condition
for the resulting savings bank for the preceding quarter was submitted to the
Secretary, fees shall be calculated in the same manner set forth in subsections
(a), (b) and (c) based on the most recent period report of the condition
submitted by the former depository institution to its primary regulator.
f) When
a savings bank ceases to be a savings bank, the former savings bank shall
remain liable to the Secretary for accumulated fees under the Act or this
Section up to and including the date, as determined by the Secretary, that
savings bank ceases to be a savings bank. The former savings bank shall not be
eligible for any credit or be liable for any assessment described in Section
9002.1(b) of the Act.
g) Nothing
in this Section is to be construed as limiting or being applicable to other
fees that the Department may assess pursuant to the Act or other State laws or
rules. The dates of billings shall not prejudice the validity of an invoice
for any fees billed at a later date.
(Source: Amended at 42 Ill.
Reg. 16507, effective August 23, 2018)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.140 ADJUSTED SUPERVISORY FEES (REPEALED)
Section 1075.140 Adjusted
Supervisory Fees (Repealed)
(Source: Repealed at 41 Ill.
Reg. 11336, effective August 28, 2017)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.141 SPECIAL CREDIT (REPEALED)
Section 1075.141 Special
Credit (Repealed)
(Source: Repealed at 24 Ill. Reg. 73, effective December 16, 1999)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.150 WITHDRAWAL OF APPLICATIONS OR OTHER FILINGS
Section 1075.150 Withdrawal
of Applications or Other Filings
a) Unless otherwise specified in the Savings Bank Act [205 ILCS
205] or this Part, an application or other filing submitted under the Savings
Bank Act or this Part shall be deemed withdrawn if the person making the filing
fails to respond within 120 days after a request by the Director for additional
documents or information related to the filing. All withdrawn applications or
other filings shall be terminated and shall be ineffective. The Director may
agree to extend the time in which the application or other filing shall be
deemed withdrawn unless the Savings Bank Act or this Part requires otherwise.
b) Notwithstanding subsection (a) of this Section, applications
or other filings submitted on or before September 15, 2002 shall not be deemed
withdrawn unless the person making the filings fails to respond within 120 days
after that date to a request by the Director for additional documents or
information related to the filing.
c) Nothing in this Section requires the Director to reissue
requests for additional documents or information made prior to September 15,
2002.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
SUBPART B: DEFINITIONS
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.200 DEFINITIONS
Section 1075.200 Definitions
Words or terms that are defined
in the Act shall retain the same meaning when used in this Part.
"Act"
means the Savings Bank Act [205 ILCS 205].
"Company"
means any corporation, partnership, business trust, association, or similar
organization, or any other trust unless by its terms it must terminate within
25 years or not later than 21 years and 10 months after the death of
individuals living on the effective date of the trust, but shall not include
any corporation the majority of the shares of which are owned by the United
States or by any state.
"Controlling
Interest" means a person, or company has a controlling interest in a
proposed savings bank, a lender, or a company, if the person, or company:
directly or
indirectly or acting through one or more other persons or companies owns,
controls, or has power to vote 25% or more of any class of voting securities at
the proposed savings bank, lender, or company; or
controls in
any manner the election of the majority of the directors or trustees of the
proposed savings bank, lender, or company; or
the Director
determines, after a hearing, that the company directly or indirectly exercises
a controlling influence over the management policies of the proposed savings
bank, lender, or company; or
directly or
indirectly, or acting through one or more other persons or companies, owns,
controls, or has power to vote 25% or more of any class of securities that invests
the owner, controller, or voter with the right to vote to approve or disapprove
of voluntary corporate changes and amendment of the Articles of Incorporation
and bylaws.
"Department"
means the Department of Financial and Professional Regulation.
"Director"
means the Director of the Department of Financial and Professional
Regulation-Division of Banking.
"Division"
means the Department of Financial and Professional Regulation-Division of Banking.
"Lender"
means a secured or unsecured creditor or creditors named as such in the debt
obligation and documents, creating any security interest.
"Organization
Director" means any person defined as a Director by Section 1007.55 of the
Act.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
SUBPART C: REPORTS
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.300 CONTRACTS
Section 1075.300 Contracts
a) Except employment contracts, loans on savings accounts, or
contracts with consideration of less than $25,000, a savings bank shall file
with the Director, within 10 days after the contract's execution, a copy of any
contract with the following:
1) any person owning 10% or more of the outstanding shares of
stock of the savings bank, if that savings bank issues stock;
2) any organization director, officer, employee, agent, or
attorney of the savings bank;
3) any representative, partner or immediate relative of an
officer, organization director or 10% shareholder of the savings bank or
savings bank holding company;
4) any corporation in which any of the persons listed in this
subsection have a 10% interest; or
5) any trust in which any of the persons listed in this subsection
has an interest.
b) Any savings bank knowingly entering into a contract with a organization
director, officer, or a 10% or more shareholder of any other financial
institution either directly or with a corporation or trust in which the organization
director, officer, or 10% or more shareholder owns 10% or more of the voting
stock of that corporation, or has a beneficial interest in that trust, shall file
with the Director a copy of the contract within 10 days after its execution.
c) Every contract entered into by a savings bank of a kind or
nature stated in subsection (a) or (b) shall be approved by the board of
directors of that savings bank, and that approval shall be reflected in the
minutes of the meeting of the board of directors and kept on file at the
savings bank.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.310 FINANCIAL REPORTS
Section 1075.310 Financial
Reports
Each savings bank shall file
quarterly financial reports on forms prescribed by the Director. Such reports
shall be delivered to the Director by the last day of the month following the
quarter end for which the report applies. Any savings bank that fails to submit
required reports in the time prescribed by this Section shall be subject to
fine as provided for in the Act.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
SUBPART D: OPERATIONS
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.400 CAPITAL STOCK (REPEALED)
Section 1075.400 Capital
Stock (Repealed)
(Source: Repealed at 22 Ill. Reg. 6719, effective March 30, 1998)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.410 MINIMUM CAPITAL REQUIREMENT
Section 1075.410 Minimum
Capital Requirement
a) The Director may establish a minimum capital level for a
savings bank at such amount or at such ratio of capital-to-assets as the
Director determines to be necessary or appropriate in consideration of the
circumstances of the savings bank.
b) For a financial institution applying to convert to a savings
bank charter, the Director may accept as being in full compliance with Section
5001 of the Act a financial institution with less than the minimum capital
required in Section 5001 if the financial institution has an approved capital
plan under the Financial Institutions Reform, Recovery and Enforcement Act of
1989 (12 USC1464(5)(s)(5)), and the Director finds that the financial
institution is otherwise being operated in a safe and sound manner. The
Director's determination shall be made after review of financial reports and
statements, reports of examination and other information as the Director shall
consider necessary for making a determination that the financial institution is
being operated in a safe and sound manner.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.415 CONFLICTING FEDERAL POWERS, LAW AND REGULATIONS
Section 1075.415 Conflicting
Federal Powers, Law and Regulations
With regard to the exercise of
any power derived from Section 1006(a) of The Act, and in case of conflict
between The Act and any other statute or regulation from which a power is
derived under Section 1006(a) of The Act, or in cases where clarification is
sought regarding the manner of exercising a derived power, its context or the
limits to be observed in its exercise, The Act, the Federal Deposit Insurance
Act (12 C.F.R. 300 et seq.) and the Federal Deposit Insurance Corporation Rules
(12 U.S.C. 1811 et seq.) shall prevail.
(Source: Amended at 26 Ill.
Reg. 13483, effective September 13, 2002)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.420 ADVERTISING
Section 1075.420 Advertising
If a savings bank advertises a
rate of return on any class of deposit account and there are restrictions or
conditions which must be complied with in order for the investor to be entitled
to receive such rate, such advertising shall clearly set forth such restrictions
or conditions. The terminology shall be consistent with Section 7001 of The
Act.
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.430 MAINTENANCE OF RECORDS
Section 1075.430 Maintenance
of Records
To enable the Director to
examine a savings bank, holding company, service corporation or affiliate of a
savings bank pursuant to Section 9004 of the Act, each savings bank shall
establish and maintain accounting and other records of all business transacted,
and the documents, files and other material comprising such records shall at
all times be available for examination wherever any of such files, documents or
materials may be. At a minimum, a savings bank and service corporations shall
establish and maintain the following records.
a) Disbursement Records
A savings
bank's funds shall be disbursed in accordance with a resolution adopted by the
board of directors and reviewed at least annually. Each disbursement shall be
documented to show the date, the amount and the purpose of the disbursement and
the names of the person or persons or other entities receiving such
disbursements whether paid directly, indirectly or through an escrow.
b) Record Retention
1) Before approving any loan or issuing any commitment, a savings
bank shall determine that every person that proposes to become liable to the
savings bank has the financial ability to service the proposed debt. The
procedure for determining the financial capacity of every person that proposes
to become liable to the savings bank shall be in accordance with procedures
adopted by the board of directors and reviewed at least annually. Thereafter, a
savings bank shall retain the application and other documentation supporting
each loan, as well as the complete servicing record, as part of the records of
the savings bank throughout the duration of the savings bank's investment in
the respective loan.
2) A savings bank shall retain each rejected loan application and
the information in support thereof for a period of thirty-six (36) months
following such rejection.
c) The savings bank shall:
1) require every borrower that is:
A) a trust to provide a certification by the trustee listing the
current beneficiaries of the trust;
B) a corporation to provide a certification by the corporate
secretary listing the names and percentage of ownership of all 10% or more
shareholders; and
C) a partnership to provide a certified list of partners.
2) retain such documents as a part of the savings bank's records
and that shall be maintained throughout the duration of the savings bank's
investment in the respective loan.
d) Loan Registers
1) A savings bank shall maintain one or more loan registers which
shall contain the original entry and be a permanent record, and shall show for
every loan the account number, date of the loan, amount of the loan, name of
the borrower, nature of security by types, the amount of fees, the amount of
the note, including precomputed loans, rate of interest, the term of the loan,
and such other information as desired by the savings bank.
2) All loan registers shall be kept numerically by number of
loans in order made.
e) Loans Secured by Real Estate
1) An application for the loan, signed by the borrower or its
agent, in such form and containing information as will disclose the purpose for
the loan, that is construction, purchase, refinancing, and the identity of any
security property.
2) A note evidencing the borrower's debt to repay the amount of
the loan, executed by the borrower or its agent.
3) A copy of the deed of trust or mortgage instrument on the real
estate or other document customarily used in the jurisdiction in which the real
estate security is located, evidencing the creation of a security interest in
the real estate for the benefit of the lender, which deed of trust, mortgage
instrument, or other document has been signed by the borrower or the borrower's
agent; and, if the loan is made to finance the purchase of the real estate
security for the loan, a signed statement by the borrower or its agent, as part
of or as an attachment to the application for the loan, disclosing the purchase
price of such real estate security.
4) One or more written appraisal reports, prepared at the request
of the lender or its agent and for the lender's use, and signed before the
approval of the application (except in the case of an approval conditioned upon
obtaining an appraisal) or, if the loan is an insured loan or a guaranteed
loan, a certification of the valuation assigned to real estate security by the
appraiser accepted by the insuring or guaranteeing agency and furnished to the
lender by the agency. Loans of less than $250,000 may be supported by estimates
of value other than an appraisal, such as in-house appraisals and valuations,
previous appraisals, tax assessments, tax assessment valuations, and insurance
evaluations.
5) Documentation showing the financial ability of the borrower to
repay the loan, or a written credit report prepared by the savings bank or by
others at the request of the savings bank.
6) Documentation showing when and by whom the loan was approved
and any terms of the approval.
7) Documentation showing the date, amount, purpose, the recipient
of every disbursement of the proceeds of the loan, and to the best of the
lender's knowledge, any actual recipient of any proceeds when the stated
recipient is acting as an agent or intermediary for another.
8) An opinion signed by the lender's attorney, a title insurance
policy, or other documentary evidence customarily used in the jurisdiction in
which the real estate security is located, affirming the quality and validity
of the lender's lien on the real estate security for the loan.
9) Documentation showing that the savings bank, upon the closing
of the loan, furnished to the borrower, a loan settlement statement setting
forth in detail the charges or fees the borrower has paid or is obligated to
pay to such savings bank or to any other concern or person in connection with
the loan, which documentation shall include a copy of the loan settlement
statement.
10) A record showing the status and current payment of taxes,
assessments, insurance premiums, other charges on the security for the loan,
and documenting any loss incurred on the loan security, as well as any amounts
recovered pursuant to an insurance settlement of the loss.
11) Documentation evidencing any modifications of the original
documents by which a security interest for the benefit of the lender was
created, showing appropriate approval of each party to the modification.
12) Documentation evidencing any release of any portion of the
collateral pledged to secure the loan, showing the portion of the collateral
released, the consideration, if any, paid to effect the release, and a record
of the appropriate approval of each release.
f) Loans Not Secured by Real Estate
The records with respect to each unsecured loan or loan not secured by
real estate that the savings bank makes shall include the documents referred to
in subsection (g) that are relevant to the loan. If the loan is secured by
collateral other than real estate, the lender's records also shall include
documents evidencing the creation and perfection of a security interest in the
collateral, including any financing statement. In addition, if the loan is made
to a business entity, the records shall include documentation showing whether
the obligor on the loan can generate sufficient cash flow to meet scheduled
interest and debt reduction payments, and if not sufficient, the records shall
include documentation demonstrating the anticipated source of the borrower's
payments.
g) Transfer of Records
A savings bank shall not transfer the location of any of its general
accounting or control records from its home office to a branch or other office,
or from a branch or other office to its home office or to another branch or
office unless the savings bank has sent prior written notice of the transfer to
the Director.
h) Data Processing
1) A savings bank that maintains it records by a data processing
service shall, before establishing such service, notify the Director in
writing. The notice shall be delivered at least 90 days before the date on
which the maintenance of records will begin. The notification shall include
identification of the records to be maintained by data processing services and
a statement as to the location at which the information will be maintained. Any
contract shall expressly provide that the records to be maintained by the
services shall at all times be available for examination by the Director.
2) A savings bank's data processing service center shall provide,
annually, a copy of the third party audit review, if performed.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.440 BUSINESS PLAN
Section 1075.440 Business
Plan
a) All savings banks whose operations are considered unsafe or
unsound by the Director pursuant to the Act or who have total capital less than
the amount required under Section 5007 of the Act, or any condition that would
endanger the ongoing viability of the savings bank, shall develop a business
plan and have the same available for review by the examiners. The period
covered by the business plan shall not be less than one year, but may be for
any greater number of periods that the Director may require. Each plan shall
contain the following:
1) introduction;
2) mission statement;
3) corporate objectives;
4) corporate strategies; and
5) financial projections for the period covered by the business
plan.
b) The savings bank's business plan shall be reviewed to
determine its continued viability in accordance with current economic conditions
and approved or revised, as determined by the board of directors, at least
annually.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.450 EXCESS INSURANCE
Section 1075.450 Excess
Insurance
a) Section 1005 of the Act allows savings banks to secure deposit
insurance in excess of the amounts available under federally sponsored
programs. The excess insurance may be obtained only through an entity
authorized to do business in this State and which is under the regulation of
the Division. Providers of excess insurance must be preapproved by the Director.
Each approved insurer shall be found to be financially sound and to employ
approved actuarial practices.
b) Before entering into an agreement to obtain excess insurance a
savings bank must notify the Director of its intent. The notice shall include a
copy of the proposed contract and sufficient information regarding the proposed
insurer to allow the Director to determine as to the financial stability of the
proposed insurer. The Director shall have 30 days in which to notify the
savings bank of any objections that the Director may have. Any request for
additional information that the Director may make shall be made within 20 days after
receipt of the notice. Failure of the Director to notify the savings bank
within the 30 days as prescribed in this subsection shall constitute a finding
of no objection.
c) To obtain approval from the Director, any prospective provider
of excess insurance shall agree to provide the Director with any information he
or she considers necessary to determine as to the current and continuing
financial condition of the proposed insurer. This information shall include but
not be limited to the following:
1) quarterly financial reports;
2) report of audit conducted by an independent certified public
accountant;
3) copies of minutes of board of directors' meetings; and
4) copies of examination reports made by examiners for any
regulatory agency.
d) Any insurer shall agree as a condition of approval to submit
to examination by the Director. The cost of any such examination shall be paid
by the insurer. The cost of the examination shall be based on the same fee
schedule that applies to savings banks.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.455 VACANCIES IN THE BOARD OF DIRECTORS
Section 1075.455 Vacancies
in the Board of Directors
If one or more vacancies occur
on a board of directors of a savings bank, the remaining organization directors
may continue management of the savings bank, including consenting to any
enforcement actions or any other regulatory or supervisory requirements. If the
number of organization directors falls below 5, the remaining organization directors
or the officers of the savings bank shall so inform the Director within 5
business days after the loss of the fifth organization director. The remaining organization
directors shall elect temporary organization directors at the next regular or
special meeting of the board of directors. Temporary organization directors'
terms shall expire at the next regular or special meeting of voting members of
the savings bank.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.460 BOND OF OFFICERS, ORGANIZATION DIRECTORS, EMPLOYEES AND AGENTS
Section 1075.460 Bond of
Officers, Organization Directors, Employees and Agents
Every savings bank shall
maintain bond coverage with a bonding company acceptable to the Director for
every officer, organization director, employee and agent of the savings bank or
such other persons in positions requiring the receipt, payment, management or
use of money belonging to the savings bank or whose duties permit or require
access to or custody of a savings bank's assets or require the making of
entries on the books and records of the savings bank.
a) Bond Schedule. The minimum amount of bond shall be based on
total consolidated assets of the savings bank and its subsidiaries in
accordance with the following schedule:
|
Total Assets
|
Minimum Coverage
|
|
Less than $1,000,000
|
$135,000.
|
|
$1,000,001 to $10,000,000
|
$135,000 plus $25,000 for each
$1,000,000 or fraction thereof over $1,000,000.
|
|
$10,000,001 to $50,000,000
|
$360,000 plus $50,000 for each
$5,000,000 or fraction thereof over $10,000,000.
|
|
$50,000,001 to $500,000,000
|
$760,000 plus $75,000 for each
$25,000,000 or fraction thereof over $50,000,000.
|
|
Over $500,000,000
|
$2,110,000 plus $100,000 for
each $50,000,000 over $500,000,000.
|
b) No savings bank shall be required to maintain bond coverage in
an amount greater than $3,000,000.
c) Coverage in excess of the above minimum requirements is
optional at the discretion of the board of directors of the savings bank.
d) The bond shall not provide for more than one deductible from
all losses caused by the same person or caused by the same persons acting in
collusion or combination in cases in which the losses result from dishonesty. A
deductible shall not exceed an amount determined in accordance with the
following schedule:
|
Total Capital
|
Permissible Deductible
|
|
Less than 4% of total assets
|
10% of total capital.
|
|
Greater than 4% but less than
6% of total assets
|
15% of total capital.
|
|
Greater than 6% of total
assets
|
20% of total capital.
|
e) The bond shall be in the form known as Standard Form No. 22,
Standard Form No. 24 or an equivalent as determined by the Director.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.465 INDEMNIFICATION OF OFFICERS, ORGANIZATION DIRECTORS, EMPLOYEES AND AGENTS
Section 1075.465
Indemnification of Officers, Organization Directors, Employees and Agents
a) No officer, organization director, employee, or agent of a
savings bank may be indemnified by a savings bank against any expense incurred,
if the officer, organization director, employee or agent:
1) is subject to an Order of Removal, Suspension or Industrywide
Prohibition under the Act or this Part; or
2) is subject to a final order assessing civil money penalties or
requiring affirmative action by an individual or individuals in the form of
payments to the savings bank.
b) In accordance with supervisory responsibilities, the Director may,
in his or her discretion, review the threat to bank safety and soundness posed
by any indemnification or proposed indemnification of officers, organization directors,
employees, or agents by a savings bank or for the consistency of any such
indemnification with the standards adopted by that savings bank in its
articles. Based upon this review, the Director may direct a modification of a
specific indemnification by a savings bank through administrative action.
(Source: Amended at 30 Ill. Reg.
19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.470 DECEPTIVELY SIMILAR NAMES
Section 1075.470 Deceptively
Similar Names
a) No savings bank may adopt or use any name deceptively similar
to that of another current existing savings bank or financial institution that
is located within the area as defined as follows:
1) within the counties of Cook, Lake, DuPage, McHenry, Kane and
Will, a radius of one mile of the main office of another savings bank or other
financial institution; and
2) within all other counties of the State, excluding those
specifically identified in subsection (a), a radius of 50 miles of a savings
bank or other financial institution.
b) For purposes of Subpart D of this Part, the determination of
the deceptive similarity of a name shall be made by the Director or other
person or persons as are authorized to act on the Director's behalf.
c) A savings bank chartered under the Act must use the words
"Savings Bank" or the initials "SB" in its name.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.480 MANNER OF DISPLAY OF ANNUAL MEETING NOTICE
Section 1075.480 Manner of
Display of Annual Meeting Notice
Notice as required pursuant to
Section 4003(a) of the Act shall be prominently displayed and located in plain
view of customers at each business location with at least one copy on or near
each door or entrance accessible to the general public.
(Source: Amended at 22 Ill. Reg. 6719, effective March 30, 1998)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.490 PROCEDURES FOR EXERCISE OF DISSENTERS RIGHTS
Section 1075.490 Procedures
for Exercise of Dissenters Rights
Pursuant to Section 4012(c) of the
Act, the procedures to be used by savings banks and dissenters in arriving at a
value and price for dissenters' shares, as well as how distribution shall be
made shall be as follows.
a) Within 10 days after the date on which the action giving rise
to the right to dissent is effective or 30 days after the shareholder delivers
to the savings bank the written demand for payment, whichever is later, the
savings bank shall send each shareholder who has delivered a written demand for
payment a statement setting forth the opinion of the savings bank as to the
estimated value of the shares, the savings bank's latest balance sheet as of
the end of a fiscal year ending not earlier than 16 months before the delivery
of the statement, together with the statement of income for that year and the
latest available interim financial statements, and either a commitment to pay
for the shares of the dissenting shareholder at the estimated value thereof
upon transmittal to the savings bank of the certificate or certificates, or
other evidence of ownership, with respect to such shares, or instructions to
the dissenting shareholder to sell his or her shares within 10 days after
delivery of the savings bank's statement to the shareholder. The savings bank
may instruct the shareholder to sell only if there is a public market for the
shares at which the shares may be readily sold. If the shareholder does not
sell within the 10 day period after being so instructed by the savings bank,
for purposes of this Section the shareholder shall be deemed to have sold his
or her shares at the average closing price of such shares, if listed on a
national exchange, or the average of the bid and asked price with respect to
such shares quoted by a principal market maker, if not listed on a national exchange,
during the 10 day period.
b) If the shareholder does not agree with the opinion of the
savings bank as to the estimated value of the shares, the shareholder, within
30 days from the delivery of the savings bank's statement of value, shall
notify the savings bank in writing of the shareholder's estimate of value and
demand payment for the difference between the shareholder's estimate of value
and the amount of the payment by the savings bank or the proceeds of sale by
the shareholder, whichever applies because of the procedure for which the
savings bank opted pursuant to subsection (a).
c) If, within 60 days from delivery to the savings bank of the
shareholder notification of estimate of value of the shares, the savings bank
and the dissenting shareholder have not agreed in writing upon the value of the
shares, the savings bank shall either pay the difference in value demanded by
the shareholder or file a petition in the circuit court of the county in which
either the registered office or the principal office of the savings bank is
located, requesting the court to determine the fair value of the shares. The
savings bank shall make all dissenters, whether or not residents of this State,
whose demands remain unsettled parties to the proceeding as an action against
their shares and all parties should be served with a copy of the petition.
Nonresidents may be served by registered or certified mail or by publication as
provided by law. Failure of the savings bank to commence an action pursuant to
this Section shall not limit or affect the right of the dissenting shareholders
to otherwise commence an action as permitted by law.
d) The jurisdiction of the court in which the proceeding is
commenced under subsection (c) by a savings bank is plenary and exclusive. The
court may appoint one or more persons as appraisers to receive evidence and
recommend decision on the question of fair value. The appraisers have the power
described in the order appointing them, or in any amendment to it.
e) Each dissenter made a party to the proceeding is entitled to
judgment for the amount, if any, by which the court finds that the fair value
of his or her share exceeds the amount paid by the savings bank or the proceeds
of sale by the shareholder, whichever amount applies. The judgment shall
include an allowance for interest at such rate as the court may find to be fair
and equitable in all the circumstances, from the date on which the corporate
action giving rise to the right to dissent is approved to the date of payment.
f) The court, in an appraisal proceeding commenced under
subsection (c), shall determine all costs of the proceeding, including the
reasonable compensation and expenses of the appraisers, if any, and experts
employed by any party, but shall exclude the fees and expenses of counsel for
any party. If the fair value of the shares as determined by the court
materially exceeds the amount the savings bank offered to pay for those shares,
or if no offer was made, then all or any part of the expenses may be assessed
against the savings bank. Except as otherwise provided in this Section, the
practice, procedure, judgment and costs shall be governed by the Code of Civil
Procedure [735 ILCS 5].
(Source: Amended
at 30 Ill. Reg. 19068, effective December 1, 2006)
SUBPART E: INVESTMENTS
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.500 PRUDENT PERSON RULE
Section 1075.500 Prudent
Person Rule
a) When making an authorized investment of savings bank funds,
the board of directors, all officers, employees, and agents of any kind must
exercise the judgment and care under circumstances then prevailing that persons
of prudence, discretion, and intelligence exercise in the management of their
own affairs, not in regard to speculation, but in regard to the permanent
disposition of their funds, considering the probable income as well as the
probable safety of their capital.
b) A violation of The Act shall constitute an unsafe and unsound
practice. Any person who knowingly violates any provision of The Act shall be
subject to enforcement action or civil money penalties as provided for in The
Act.
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.505 INVESTMENT UNDERWRITING PRACTICE
Section 1075.505 Investment
Underwriting Practice
A savings bank may grant a loan
or invest in other authorized assets under the Act.
a) For all types of secured and unsecured loans granted, and
other investments entered into, a savings bank's board of directors shall
establish and approve, at least annually, written loan underwriting and other
investment policies and procedures. These policies and procedures shall set
forth criteria sufficient to allow a decision to be made in accordance with
Section 1075.500 of this Part.
b) A loan or other investment may be apportioned among
appropriate categories, and may be moved, in whole or part, from one category
to another as follows.
1) To classify a loan as a real estate loan, a savings bank must
rely substantially upon the real estate as the primary security for the loan.
2) For purposes of determining whether aggregate investments
under this Part exceed an applicable percentage-of-assets limitation, a loan
commitment shall be counted as an investment and shall be included in total
assets of a savings bank only to the extent that funds have been advanced (and
not repaid) pursuant to the commitment. The term "loan commitment"
used in the preceding sentence includes a loan in process, a letter of credit,
or any other commitment to extend credit.
3) Loans sold to a third party shall be included in calculation
of a percentage-of-assets investment limitation only to the extent they are
sold with recourse.
4) A savings bank may make a loan secured by assignment of loans
to the extent that it could, under applicable law and regulations, make or
purchase the underlying assigned loans.
c) The written policies and procedures pertaining to loans
secured by collateral other than real estate, mobile home chattel paper, or the
cash surrender value of life insurance shall provide specific procedures for
determining the value of the respective collateral.
(Source: Amended at 22 Ill. Reg. 6719, effective March 30, 1998)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.510 DISCRIMINATION AND REDLINING
Section 1075.510
Discrimination and Redlining
a) It shall be considered discriminatory to refuse to grant loans
or to vary the terms of loans or the application procedures for loans because
of:
1) the proposed borrower's race, color, religion, national
origin, age, sex, physical disability or marital status; or
2) the geographic location of the proposed mortgage loan
security.
b) A presumption of discrimination shall be attached to any
inquiry regarding a loan authorized by the savings bank's board of directors
when:
1) a savings bank refused to accept a written application; or
2) a loan application is rejected and not supported by adequate
documentation which includes information sufficient to permit an informed
non-interested party to reach the same conclusion as the lender concerning the
disposition of the application.
c) In cases of a savings bank's non-compliance with this Subpart,
the Director, by written notice, shall require that all inquiries for loans
received from proposed borrowers be accepted in writing on application forms
that provide information sufficient to make an informed decision concerning the
final disposition of the respective loan application. Thereafter, the savings
bank shall submit a copy of each rejected application to the Director with a
written statement setting forth the reason for rejecting the application and a
copy of each document supporting the decision.
d) A savings bank shall be required to comply with the Director's
directive issued pursuant to subsection (c) for a minimum of 6 months. Should a
presumption of discrimination exist at the close of the six-month period, the
respective savings bank shall be required to continue reporting until the Director,
by examination, determines that discriminatory practices have ceased and the
savings bank is so notified.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.515 LOANS SECURED BY REAL ESTATE
Section 1075.515 Loans
Secured by Real Estate
a) A savings bank may originate, invest in, sell, purchase,
service, participate, or otherwise deal in (including brokerage or warehousing)
real estate loans or interest in those loans.
b) In determining compliance with the maximum loan-to-value
limitations specified in this Subpart, a savings bank shall add to the loan
amount the total of all other existing liens or other encumbrances on the
security property having priority over the savings bank lien (including the
lien to be established by the savings bank but excluding liens that will be
released as the result of payments made from the proceeds of the new loan).
c) At the time of origination, a real estate secured loan granted
under the provisions shall not exceed the maximum loan-to-value ratio as follows.
1) With respect to home loans originated or refinanced in excess
of 90% of the appraised value of the security property, that part of the unpaid
balance that exceeds 80% of the property's value shall be insured or guaranteed
by mortgage insurance.
2) With respect to all other loans on the security of real estate
originated in excess of 90% of the appraised value of the security property, a
savings bank's board of directors, or loan comittee, shall approve each loan
before its origination and such approval, or ratification of the loan committee
approval, shall be recorded in the minutes of its meeting.
3) In determining compliance with the maximum loan-to-value ratio
limitations for real estate loans, at the time of making a loan a savings bank
shall add together the unpaid amount, or in the case of a line-of-credit loan
the approved credit limit, of all recorded loans secured by prior mortgages,
liens or other encumbrances on the security property that would have priority
over the savings bank's lien, and shall not make such a loan unless the total
amount of the loans (including the one to be made but excluding loans that will
be paid off out of the proceeds of the new loan) does not exceed the applicable
maximum loan-to-value ratio limitations prescribed in subsection (c). In
valuing the real estate security, a savings bank may use the current appraised
value of the security property, which may include any expected value of
improvements to be financed. "Value" for a real estate loan means the
market value of the real estate. For loans granted pursuant to Section 6002(3)
of the Act, alternative methods of valuation or other procedures that result in
an estimate of value may be used.
d) The loan-to-value limitations specified in subsection (c)
shall not apply to the following.
1) To loans guaranteed or insured wholly or in part by the United
States or any of its instrumentalities.
2) To loans or contracts made to finance the purchase of real
estate owned that has been acquired by the savings bank through default on a
prior investment provided that the minutes of organization directors' meetings
substantiate that the sale is made in compliance with the following:
A) the board of directors approved the specific terms of the loan
or contract before the savings bank's issuance of a letter of commitment. If no
letter of commitment is to be issued, such approval shall be before the
execution of a note, mortgage, or contract for deed between the purchaser and
the savings bank;
B) the board of directors' resolution of approval of the
respective sale specifically indicates why the sale is in the best interest of
the savings bank and that approval is given after duly considering the
provisions of this Subpart;
C) the resolution identifies the specific documentation they have
utilized in determining that the sale was in the best interest of the savings
bank; and
D) all documentation used in evidencing compliance with this Subpart
is retained as a part of the records of the savings bank for so long as the
savings bank has a direct or indirect interest in the respective real estate.
3) Loans or contracts having additional eligible collateral
pledged in an amount equal to that part of the loan or contract that is in
excess of the lending limitations specified in subsection (c). Eligible
collateral means:
A) any investment permissible for savings banks under the Act;
B) any savings or time deposit in a commercial bank that is
insured by the Federal Deposit Insurance Corporation and not under control of
any supervisory authority; or
C) the cash surrender value of a life insurance policy validly
assigned to the savings bank.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.520 CONSTRUCTION LOANS
Section 1075.520
Construction Loans
Construction lending policies
and procedures shall provide that
a) No disbursements shall be made unless in conformity with a
contractor's statement or amended statement, which statement or amended
statement shall comply with the mechanics' lien laws of the State in which the
collateral property is located and shall be kept on file at the savings bank
throughout the duration of the savings bank's investment in the respective
loan.
b) No construction funds shall be disbursed before receipt of a
written statement indicating that the work for which payment is being requested
has been completed. Such written statement shall be furnished by a person
authorized by the board of directors.
c) No construction funds shall be disbursed unless approved by
the borrower or the borrower's authorized agent. A blanket authorization may be
accepted.
d) The savings bank shall at all times retain construction funds
sufficient to complete the improvements in accordance with the contractor's
statement or amended statement. A savings bank may take into consideration
equity provided by the borrower in the form of labor.
e) Waivers of mechanics' liens shall be required and shall be
delivered to the savings bank or its agent before each disbursement of
construction funds unless a lien free form of title insurance policy is
obtained before such disbursement.
(Source: Amended at 22 Ill. Reg. 6719, effective March 30, 1998)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.525 MOBILE HOME FINANCING (REPEALED)
Section 1075.525 Mobile Home
Financing (Repealed)
(Source: Repealed at 22 Ill. Reg. 6719, effective March 30, 1998)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.530 OVERDRAFT LOANS
Section 1075.530 Overdraft
Loans
A savings bank may extend
secured or unsecured credit to cover the payment of checks, drafts, or other
funds transfer orders in excess of the available balance of an account on which
they are drawn.
(Source: Amended at 22 Ill. Reg. 6719, effective March 30, 1998)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.535 EDUCATION LOANS
Section 1075.535 Education
Loans
A savings bank may invest in
loans, debts, and advances of credit made for the financing of primary,
secondary, undergraduate or post-graduate education.
(Source: Amended at 22 Ill. Reg. 6719, effective March 30, 1998)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.540 VEHICLE/AUTOMOBILE LOANS
Section 1075.540
Vehicle/Automobile Loans
A savings bank may invest in
loans, debts and advances of credit made for the purpose of financing
vehicle/automobile purchases.
For the purposes of this
Section, vehicles/automobiles shall include all motorized forms of
transportation which the board of directors of a savings bank shall by written
policy consider to be adequate collateral.
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.545 HOME EQUITY LOANS
Section 1075.545 Home Equity
Loans
Savings banks are permitted,
without limitation on the percentage of total assets, to establish revolving
lines of credit on the security of a first or junior lien on the borrower's
personal residence, based primarily on the borrower's equity. The proceeds of
such loan may be used for any purpose.
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.550 LETTER OF CREDIT
Section 1075.550 Letter of
Credit
A savings bank is permitted to
issue letters of credit provided that the total funds advanced plus secured and
unsecured loans for business, corporate, commercial, agricultural, or overdraft
purposes does not exceed 15 percent of total assets.
a) The letter of credit must clearly indicate it as a letter of
credit, that the issuer's debt to pay is solely dependent upon conforming
documents, that the account party must have an unqualified obligation to
reimburse the issuer for payments made, and include a specified expiration date
or definite term.
b) The underwriting and documentation for a letter of credit must
be in conformance with Section 1075.505 of this Part.
c) All documentation used in evidencing compliance with this
Section is retained as part of the records of the savings bank for the term of
the letter of credit.
d) Nothwithstanding any provision of this Section, a savings bank
may issue letters of credit to the same extent and manner as permitted to any
other type of depository institution.
(Source: Amended at 26 Ill.
Reg. 13483, effective September 13, 2002)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.555 OTHER INVESTMENTS
Section 1075.555 Other
Investments
Pursuant to Section 6003 of the Act,
a savings bank is permitted to invest in loans secured by stock or equity
securities, other than stock or equity securities of a depository institution,
if the stock or equity security has a readily available market. Such investment
shall not exceed 1 percent of the total assets of the savings bank. Notwithstanding
any provision of this Section, a savings bank may invest in loans secured by
stock or equity securities to the same extent and manner as permitted to any
other type of depository institution.
(Source: Amended at 26 Ill.
Reg. 13483, effective September 13, 2002)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.560 COMMERCIAL PAPER
Section 1075.560 Commercial
Paper
a) A savings bank is permitted to invest in commercial paper to
the extent that the total of loans for business, corporate, commercial,
overdrafts and agriculture, plus corporate debt securities and commercial paper
does not exceed 30 percent of the total assets of the savings bank.
b) Investments
in commercial paper are limited as follows:
1) up to 1 percent of assets, or $1,000,000, whichever is more,
in commercial paper of any one issuer rated, as of the date of purchase, in the
highest category by a national rating service;
2) up to ½ of 1 percent of assets, or $500,000, whichever is more,
in commercial paper of any one issuer rated, as of the date of purchase, in one
of the two highest categories by a national rating service; or
3) up to ¼ of 1 percent of assets, or $250,000, whichever is
more, in commercial paper of any one issuer rated, as of the date of purchase,
in one of the four highest categories by a national rating service.
Notwithstanding
any provision of this Section, a savings bank may invest in commercial paper to
the same extent and manner as permitted any other type of depository
institution.
(Source: Amended at 26 Ill.
Reg. 13483, effective September 13, 2002)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.565 FINANCIAL FUTURES
Section 1075.565 Financial
Futures
a) Definitions as used in this Section apply unless the context
otherwise requires.
"Financial Futures Transaction" means the purchase
or sale of a financial futures contract.
"Forward Commitment" means a written commitment to
make, purchase or issue mortgage loans or mortgage-related securities at a
price and on or before a date specified in the commitment.
"Long Position" means the purchase of a financial
futures contract to take delivery of a financial instrument.
"Mortgage-Related Securities" means securities
based on and backed by mortgages, including mortgage-backed securities
guaranteed by the Government National Mortgage Association (GNMA's), Mortgage
Participation Certificates of the Federal Home Loan Mortgage Corporation, and
similar obligations issued by a private issuer or in which the savings bank
shall invest.
"Offset" means to cancel an obligation to make or
take delivery of securities under a financial instrument under a financial
futures contract. A futures contract to purchase a financial instrument is
offset by a futures contract to sell a financial instrument of the same type
for the same delivery month. A futures contract to sell a financial instrument
is offset by a futures contract to purchase a financial instrument of the same
type for the same delivery month.
"Short Position" means the holding of a financial
futures contract to make delivery of a financial instrument.
b) Permitted Transactions – to the extent that it has legal power
to do so, a savings bank may engage in interest rate futures transactions to
reduce its net interest rate risk exposure as provided in this subsection. For
purposes of this Section, net interest rate risk exposure is the volatility in
a savings bank's earnings that can arise from the mismatching of the maturities
of assets and liabilities. A savings bank may enter into short positions that
are appropriate for reducing its net interest-risk exposure. A savings bank may
enter into long positions, other than those that offset short positions, only
under the following conditions.
1) The futures position must be matched against a firm forward
commitment to sell mortgages not yet originated or to issue mortgage-related
securities to be based on mortgages not yet originated. For purposes of
subsection (b), a firm forward commitment is a written commitment obligating
the seller to make delivery, and the buyer to take delivery of mortgage loans
not yet originated or mortgage-related securities to be based on mortgages not
yet originated, at a price and on or before a date specified in the commitment.
2) The futures position may be entered into and maintained only
to the extent that the savings bank's firm forward commitments exceed 10% of
long-term assets with fixed interest rates. For purposes of this Section,
long-term assets are those having remaining terms to maturity in excess of 5 years.
c) Authorized Contracts – savings banks may engage in interest
rate futures transactions using any interest rate futures contracts designated
by the Commodity Futures Trading Commission (CFTC) and based upon a financial
instrument in which the savings bank has authority to invest or to issue.
d) Board of Directors' Authorization – before engaging in
interest rate futures transactions, a savings bank's board of directors must
authorize such activity. In authorizing futures trading, the board of directors
shall consider any plan to engage in financial futures transactions, shall endorse
specific written policies, and shall require the establishment of internal
control procedures. Policy objectives must be specific enough to outline
permissible contract strategies, taking into account price and yield
correlations between assets or liabilities and the financial futures contracts
with which they are matched; the relationship of the strategies to the savings
bank's operations; and how such strategies reduce the savings bank's net
interest rate risk exposure. Internal control procedures shall include, at a
minimum, periodic reports to management, segregation of duties and internal
review procedures. In addition, the minutes of the meeting of the board of
directors shall set forth limits applicable to futures transactions, identify
personnel authorized to engage in futures transactions, and set forth the
duties, responsibilities and limits of authority of such personnel. The board
of directors shall review the position limit, all outstanding positions, and
the unrelated gains or losses on those positions at each regular meeting of the
board.
e) Notification – a savings bank engaging in financial futures
transactions shall notify the Director that it is engaging in those
transactions. The savings bank shall report its gross outstanding long and
short financial futures positions on its monthly report.
f) Record Keeping Requirements – a savings bank engaging in
financial futures transactions shall maintain records of those transactions
sufficient to document how the transactions reduce the net interest rate risk
exposure of the savings bank in accordance with the following requirements.
1) Contract Register – the savings bank shall maintain a contract
register adequate to identify and control all financial futures contracts and
including, at a minimum, the type and amount of each contract, the maturity
date of each contract, the cost of each contract, the dollar amount and
description of the asset or liability with which the futures contract is
matched, and the date and manner in which a contract is closed out. The
register shall be prepared in a manner sufficient to indicate at any time the
savings bank's total outstanding long and short financial futures positions.
2) Other Documentation – the savings bank shall maintain, as part
of the documentation of its financial futures strategy, a schedule of the
assets and the liabilities for which net interest rate risk exposure is being
reduced and the purpose of each contract entered.
3) Maintenance of Records – the records designated in this subsection
(f) shall be maintained for all futures transactions closed-out during the
preceding 2 years.
(Source: Amended
at 30 Ill. Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.570 FINANCIAL OPTIONS
Section 1075.570 Financial
Options
a) Definitions as used in this Section apply unless the context
otherwise requires.
1) "Call" means an option which gives the holder the
right to purchase a financial instrument at a price and on or before the
expiration date specified in the option contract.
2) "Deliverable Instrument" means a financial
instrument whose terms satisfy the requirements for fulfilling delivery
obligations of an option.
3) "Effective Exercise Price" means the yield
equivalent price of an instrument whose coupon rate differs from the standard
instrument specified in the option,
4) "Financial Options Contract" means an agreement
(other than an optional delivery forward commitment contract to purchase and
sell mortgages or mortgage-backed securities when used as part of the mortgage
loan origination process) to make or take delivery of a financial instrument upon
demand by the holder of the contract at any time before the expiration date
specified in the agreement, under terms established either by:
A) a board of trade designated as a contract market for the
trading of option contracts by the CFTC or a national securities exchange
registered with the Securities Exchange Commission (SEC); or
B) the savings bank and a "permissible counterparty," as
defined in subsection (a)(10), that are counterparties in an over-the-counter
option transaction (other than an over-the-counter commodity optional
transaction subject to the jurisdiction of the CFTC that is not otherwise
authorized under the Commodity Exchange Act (7 USC 1) and the regulations under
that Act).
5) "Financial Options Transaction" means the purchase or
sale of a financial options contract.
6) "Immediate Exercise Value" means the market value
gained by exercising an option with the lowest cost deliverable instrument at
its effective exercise price compared to purchasing (or selling) an identical
instrument with the same coupon rate in the cash market.
7) "Long Position" means the holding of a financial
options contract with the option to make or take delivery of a financial
instrument.
8) "Option Commitment Fee" means the option premium
minus the immediate exercise value of the option.
9) "Option Premium" means the price paid or received
for establishing an option position.
10) "Permissible Counterparty" means any entity that
is:
A) a primary dealer as defined in subsection (a)(11) of this
Section;
B) a bank subject to the regulation and supervision of the
Comptroller of the Currency, the Federal Deposit Insurance Corporation, or the
Board of Governors of the Federal Reserve System and that is in compliance with
applicable regulatory capital requirements;
C) a savings bank that is subject to the regulation and
supervision of the Division and is in compliance with applicable regulatory
capital requirements or subject to the regulation and supervision of the Division;
D) a broker or dealer registered with the Securities and Exchange
Commission (SEC) and subject to regulation and supervision by a Registered
Securities Association (registered pursuant to section 15A of the Securities
and Exchange Act of 1934 (15 USC 78(o)) (Exchange Act) or a National Securities
Exchange (registered pursuant to sections 6 and 19(a) of the Exchange Act) and
that is in compliance with applicable capital requirements;
E) a government securities broker or dealer registered with the
SEC that is subject to examination and supervision by a Registered Securities
Association (registered pursuant to section 15A of the Exchange Act) or
National Securities Exchange (registered pursuant to sections 6 and 19(a) of
the Exchange Act) and that is in compliance with applicable capital
requirements;
F) a futures commission merchant registered with the CFTC and
that is in compliance with applicable capital requirements;
G) the Federal Home Loan Banks;
H) the Federal Home Loan Mortgage Corporation, the Federal
National Mortgage Association, or the Government National Mortgage Association
or the Government National Mortgage Association; or
I) any other entity that the Director , upon application,
determines to be adequately regulated, capitalized, and audited or examined
such that acting as a counterparty in an over-the-counter options transaction
with a savings bank would not entail substantial credit risks for the savings
bank.
11) "Primary Dealer in Government Securities" means any
member of the Association of Primary Dealers in United States Government
Securities and any parent, subsidiary, or affiliated entity of such primary
dealer: provided, that the member guarantees (to the satisfaction of the Division)
the over-the-counter financial options transactions between its parent,
subsidiary, or affiliated entity with a savings bank, and provided further that
the parent, subsidiary, or affiliated entity is substantially engaged in
similar activities.
12) "Put" means an option that gives the holder the
right to sell a financial instrument at a price on or before the expiration
date specified in the financial options contract.
13) "Short Position" means a commitment through a
financial options contract to stand ready during the term of the contract to
make or take delivery of a financial instrument.
b) Permitted Transactions – to the extent that it has legal power
to do so, a savings bank may engage in financial options transactions as
follows:
1) Long Positions – a savings bank may enter into long positions
without numerical limit.
2) Short Positions – a savings bank may enter into short call
positions without numerical limit. If a savings bank meets its capital requirement,
it may enter into short put options to the extent that the aggregate amount of
its short put options and forward commitments to purchase securities does not
exceed 15% of total assets. If capital requirements are not met, the savings
bank may enter into short put options only with prior written approval from the
Director. Permission shall be granted if the Director finds the investment is
not for speculative purposes and that the investment is made in accordance with
a well-defined hedging program adopted by the savings bank board of directors.
c) Authorized Contracts – a savings bank may engage in financial
options transactions using any financial options contracts either:
1) designated by the CFTC or approved by the SEC; or
2) entered into with a "permissible counter-party", as
defined in subsection (a)(10), and based upon a financial instrument that the
savings bank has authority to invest in or to issue.
d) Board of Directors' Authorization – before engaging in
financial options transactions, a savings bank's board of directors must
authorize such activity. In authorizing options, the board of directors shall
consider any plan to engage in writing or purchasing financial options
contracts, shall endorse specific written policies, and shall require the
establishment of internal control procedures. For options positions that will
be matched with cash or forward market positions, policy objectives must be
specific enough to outline permissible options contract strategies, taking into
account price and yield correlations between assets or liabilities and the
financial options contracts; the relationship of the strategies to the savings
bank's operations; the rationale for the ratio of the value of options
positions to the value of the matched cash market positions; and how the
options strategy reduces the savings bank's interest rate risk exposure. For
unmatched option positions, policy objectives must specify the relationship of
the strategy to the savings bank's operations. Prudent business judgment shall
be exercised by participating savings banks engaging in financial options
transactions to maintain a safe and sound financial position. Internal control
procedures shall include, at a minimum, periodic reports to management,
segregation of duties and internal review procedures. In addition, the minutes
of the meeting of the board of directors shall set forth limits applicable to
financial options transactions, identify personnel authorized to engage in
financial options transactions, and set forth the duties, responsibilities and
limits of authority of such personnel. The board of directors shall review the
position limit, all outstanding options contract positions, and the unrealized
gains or losses on those positions at each regular meeting of the board.
e) Notification, Reporting, and Approval
1) A savings bank shall notify the Director immediately following
authorization of its board of directors to engage in financial options
transactions. The savings bank shall report its outstanding positions, together
with the total unrealized gain or loss from those positions to the Director
monthly.
2) A savings bank shall not engage in over-the-counter financial
option transactions with any permissible counterparty unless the counterparty
agrees to notify the Director. A savings bank shall not continue to engage in
over-the-counter financial option transactions with any permissible
counterparty that has failed to so notify the Director with respect to previous
over-the-counter financial option transactions with that savings bank.
Notwithstanding the foregoing, no savings bank shall engage in a long
over-the-counter financial option transaction with a specific permissible
counterparty, without obtaining the prior approval of the Director, whenever
the aggregate exercise value of all long over-the-counter financial option
positions with the counterparty exceeds the limitations contained in Section
6013 of the Act. The Director may approve any financial option transaction
whenever it determines that such transaction does not subject the savings bank
to undue risk. In making such determinations, the Director shall consider:
A) the credit worthiness of the specific counterparty;
B) the savings bank's experience with the counterparty and with
transacting in financial option and futures contracts generally;
C) the nature of the subject contracts (e.g., matched or
unmatched); and
D) any other circumstances considered relevant by the Director. An
application to enter into a financial option transaction under this Section
shall be considered approved if the Director does not deny the application
within 10 calendar days from the date the application was filed.
f) Record Keeping Requirements – a savings bank engaging in
financial options transactions shall maintain records of those transactions in
accordance with the following requirements.
1) Contract Register – the savings bank shall maintain a contract
register adequate to identify and control all financial options contracts and
sufficient to indicate at any time the amounts of financial options contracts
required to be reported on its monthly report. At a minimum, the register shall
list the type, amount, expiration date and the cost of income from each contract.
2) Other Documentation – the savings bank shall maintain as part
of the documentation of its financial options strategy a schedule of any cash
market or forward commitment position with which the option is matched and the
purpose of each contract.
3) Maintenance of Records – the records designated in this
Section shall be maintained for all financial options closed out during the
preceding 2 years.
g) Accounting
1) Purchase or Sale – upon initial purchase or sale of a
financial options contract, a memorandum entry of the information specified in
this Section shall be made and appropriate margin accounts shall be
established.
2) Option Commitment Fee
A) The option commitment fee paid for a long position or received
from the sale of a short put option shall be amortized to income or expense
over the term of the option, except as provided in this Section.
B) The option commitment fee received from the sale of a matched
short call option shall be deferred until the option position is terminated.
The option commitment fee received from the sale of an unmatched short call
option shall be amortized to income over the term of the option.
3) Options Contracts
A) Gains or losses on options contracts that are matched with
assets or liabilities carried at the lower of cost or market value, or carried
at market value shall be considered in determining the market value of the
asset or liability.
B) Options positions that are matched with assets or liabilities
carried at cost or to be carried at cost shall be accounted for as follows.
i) If a commitment fee will be or has been received with respect
to the matched asset, the option commitment fee shall be treated as an
adjustment of such fee. The adjusted commitment fee shall then be treated as a
fee paid or received in connection with the matched asset.
ii) If a commitment fee has not been received with respect to a
matched asset, the option commitment fee (except if received for the sale of a
short call option) shall be amortized to income or expense over the commitment
period by the straight line method.
iii) Any resulting gain or loss from an option position (except
from a short call option) shall be treated as a discount or premium on the
matched asset or liability.
iv) Any resulting gain or loss from a short call option position
shall be recognized as income or expense upon termination of the option
position.
v) If an option position is not matched with a cash-market or
forward-commitment position or the cash-market or forward-commitment position
with which an option is matched is sold or will not occur, the option shall be
marked to market.
C) The immediate exercise value of short puts and other unmatched
option positions shall be carried at their current market value.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.575 FINANCE LEASING
Section 1075.575 Finance
Leasing
Savings banks may engage in
leasing activities that are the functional equivalent of lending, subject to
the limitations of this Section.
a) A savings bank may become the legal or beneficial owner of
tangible personal property or real property to lease such property, may obtain
an assignment of a lessor's interest in a lease of such property, and may incur
obligations incidental to its position as the legal or beneficial owner and
lessor of the leased property, if:
1) the lease is a net, full-payout lease representing a
non-cancelable obligation of the lessee, not-withstanding the possible early
termination of the lease; and
2) at the expiration of the lease, the savings bank's interest in
the property shall be liquidated or released on a net basis as soon as practicable.
b) A lease of tangible personal property made to a natural person
for personal, family or household purposes pursuant to this Section shall be
subject to all limitations applicable to the amount of a savings bank's
investment in similar loans. A lease made for commercial, corporate, business
or agricultural purposes pursuant to this Section shall be subject to all
limitations applicable to the amount of a savings bank's investment in
commercial loans. A lease of residential or nonresidential real property made
pursuant to this Section shall be subject to all limitations applicable to the
amount of a savings bank's investment in real estate loans.
c) Definitions
− for the purposes of this Section shall be the following.
1) The term "net lease" means a lease under which the
savings bank will not, directly or indirectly provide or be obligated to
provide for:
A) the servicing, repair or maintenance of the leased property
during the lease term;
B) the purchasing of parts and accessories for the leased
property, except that improvements and additions to the leased property may be
leased to the lessee upon its request in accordance with the full-payout
requirements of this Section;
C) the loan of replacement or substitute property while the leased
property is being serviced;
D) the purchasing of insurance for the lessee, except where the
lessee has failed to discharge a contractual obligation to purchase or maintain
insurance; or
E) the renewal of any license, registration of filing for the
property unless such action by the savings bank is necessary to protect its
interest as an owner or financier of the property.
2) The term "full-payout" lease means one from which
the lessor can reasonably expect to realize a return of its full investment in
the leased property, plus the estimated cost of financing the property over the
term of the lease, from rentals, estimated tax benefits, guarantees and other
sources, and the estimated residual value of the property at the expiration of
the initial term of the lease. Provided that no more than 20 percent of the
return may be realized from the residual value of the property at the
expiration of the initial term of the lease, both the estimated residual value
of the property and that portion of the estimated residual value relied upon by
the lessor to satisfy the requirements of a full-payout lease must be
reasonable in light of the nature of the leased property and all relevant
circumstances so that realization of the lessor's full investment plus the cost
of financing the property depends primarily on the credit worthiness of the
lessee, and not on the residual market value of the leased property. The
maximum term of a full-payout lease shall be 20 years.
d) Salvage Powers − if, in good faith, a savings bank
believes that there has been an unanticipated change in conditions that
threatens its financial position by significantly increasing its exposure to
loss, this Section shall not prevent the savings bank:
1) as the owner and lessor under a net, full-payout lease, from
taking reasonable and appropriate action to salvage or protect the value of the
property and its interest arising under the lease;
2) as the assignee of a lessor's interest in a lease, from
becoming the owner and lessor of the leased property pursuant to its
contractual right, or from taking any reasonable and appropriate action to
salvage or protect the value of the property or its interest arising under the
lease; or
3) from including any provisions in a lease, or from making any
additional agreements, to protect its financial position or investment in the
circumstances set forth in this Section.
e) Notwithstanding any limitation of this Section, a savings bank
may engage in leasing activities to the same extent and manner permitted to any
other type of depository institution.
(Source: Amended at 26 Ill.
Reg. 13483, effective September 13, 2002)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.580 SURETYSHIP
Section 1075.580 Suretyship
A savings bank may enter into
an agreement to act as a surety subject to the following provisions.
a) A savings bank operating under the Act may exercise surety
powers only to the extent authorized by the Federal Deposit Insurance
Corporation.
b) A savings bank may enter into a suretyship agreement only if
the agreement would create an obligation authorized for investment by a savings
bank. A savings bank's obligation under the suretyship agreement shall be
treated as a loan to its principal for purposes of Sections 6010 and 6013 of the
Act and Section 1075.500 of this Part.
c) A savings bank must take and maintain a security interest in
real estate or marketable investment securities, as defined at Section 1007.85
of the Act, of its principal having a market value, determined in accordance
with the provisions of the Act and this Part, of at least 110 percent of the
savings bank's total suretyship obligations. In determining compliance with the
110 percent collateralization requirement, the savings bank shall consider the
value available above prior mortgages or liens, except those held by the party
for whose protection the suretyship agreement is made. If marketable investment
securities, the savings bank shall provide for the maintenance of the
collateral value at the required level throughout the term of the suretyship
agreement.
d) To the extent that a savings bank is required to meet its
obligations under a suretyship agreement, the amount expended shall be treated
as an extension of credit subject to the limitations imposed on similar loans
under the various provisions of the Act and this Part.
e) Notwithstanding any provision of this Section, a savings bank
may act as a surety to the same extent and manner as permitted to any other
type of depository institution.
(Source: Amended at 26 Ill.
Reg. 13483, effective September 13, 2002)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.585 ASSET RESERVES
Section 1075.585 Asset
Reserves
a) Scope
The classification system described in this Section applies to all assets
or portions of assets held by a savings bank.
b) Classifications
1) Substandard – assets classified substandard are inadequately
protected by the current paying capacity of the obligor or of the collateral
pledged, if any. Assets so classified must have a well-defined weakness or
weaknesses. They are characterized by the distinct possibility that the savings
bank will sustain some loss if the deficiencies are not corrected.
2) Doubtful – assets classified doubtful have all the weaknesses
inherent in those classified Substandard with the added characteristic that
collection of the asset in full, on the basis of currently existing facts,
conditions, and values, is highly questionable and improbable.
3) Loss – assets classified loss are considered uncollectible and
of such little value that their continuance as assets without establishment of
a reserve is not warranted. This classification does not mean that an asset has
absolutely no recovery or salvage value, but, rather, that it is not practical
or desirable to defer writing off a basically worthless asset even though
partial recovery may be effected in the future.
c) Implementation of Classification System
1) In connection with examinations of a savings bank or its
affiliates, the examiner shall have authority to identify problem assets and,
if appropriate, classify them.
2) Each savings bank shall classify its own assets on a regular
basis. In addition to any other remedies available to the Division under
applicable statutes and regulations, a savings bank's failure to set aside
prudent valuation allowances, or to monitor portfolio risk with an effective
self-classification procedure, will be considered by the examiner in
determining the amount of valuation allowances to be established by the savings
bank.
3) In its reports to the Division , each savings bank shall
include aggregate totals of assets that the savings bank has classified in each
of the 3 asset classification categories, and the aggregate general and
specific valuation allowances established. To the extent a savings bank's specific
valuation allowances have decreased from the previous reporting period, the
savings bank shall identify the amount of the decrease attributable to a
savings bank's between examination upgrading of classifications.
d) Effect of Classification
1) When, pursuant to this Section, a savings bank has classified
one or more assets, or portions of assets, substandard or doubtful, the savings
bank shall establish prudent general allowances for loan losses. When, pursuant
to this Section, an examiner has classified one or more assets or portions of
assets substandard or doubtful and has determined that the existing valuation
allowances are inadequate, the savings bank shall establish general allowances
for loan losses in an appropriate amount as determined by the examiner, subject
to approval of the Director.
2) When, pursuant to this Section, either a savings bank or an
examiner has classified one or more assets or portions of assets loss, the
savings bank shall either establish allowances for losses in the amount of 100%
of the portion of the assets classified loss, or charge off that amount against
current income.
3) Adequate valuation allowances consistent with generally
accepted accounting principles shall be established for classified assets.
Asset evaluations (and the corresponding allowances) that are consistent with
the practice of the federal banking agencies may be used for supervisory
purposes.
e) Assets Deserving "Special Mention"
Assets that do not currently expose a savings bank to a sufficient degree
of risk to warrant classification under this Section but do have credit
deficiencies or potential weaknesses deserving management's close attention
shall be designated "special mention" by either the savings bank or
the examiner. Special mention assets have a potential weakness or pose an
unwarranted financial risk that, if not corrected, could weaken the asset and
increase risk in the future.
f) Delegations and Interpretations
1) The Director or designee may approve, disapprove, or modify any
classifications of assets made pursuant to this Section and any amounts of
allowances for loan losses established by a savings bank or required by
examiners pursuant to this Section.
2) When an appraisal is required or made in connection with any
reevaluation of assets, the Director may approve or reject the appraisal and
any valuation related to it.
3) The Division shall, from time to time, issue supervisory
interpretations and other informational material regarding classification of
assets.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.590 ASSET COMPOSITION TEST
Section 1075.590 Asset
Composition Test
As an alternative asset test
prescribed pursuant to Section 1009 of the Act, the composition of the assets,
including loans and investments, of a savings bank is permitted to consist of
any type, and in any amount, authorized by the Act and this Part, provided that
the savings bank:
a) is a member of a Federal Home Loan Bank as a Federal Home Loan
Bank qualified thrift lender or community financial institution under the
Federal Home Loan Bank Act (12 USC 1421 et seq.);
b) has at least 10 percent of its total assets in residential
mortgage loans as of the most recent fiscal year-end; or
c) has total average assets for the three preceding fiscal years
of less than $500,000,000.
This Section does not require
membership in a Federal Home Loan Bank.
(Source: Added at 26 Ill.
Reg. 13483, effective September 13, 2002)
SUBPART F: SERVICE CORPORATION AND OPERATING SUBSIDIARIES
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.600 REQUIREMENTS
Section 1075.600
Requirements
a) No savings bank shall invest in or lend to a service
corporation, as defined in Section 1007.105 of the Act, unless the service
corporation has been approved by the Director.
b) Subpart F of this Part shall not apply to investments in
single purpose corporations authorized under Sections 1008(9) and 6009 of the
Act.
c) Savings banks may designate a service corporation or other
subsidiary as an operating subsidiary as follows:
1) Upon approval of the Director, a subsidiary of a savings bank that
is majority owned and controlled by the savings bank may be designated as an
operating subsidiary provided that the subsidiary engages solely in activities
that are permitted for a depository institution or an operating subsidiary of a
depository association.
2) An operating subsidiary shall be subject to the provisions of
this Subpart except that a savings bank's total investment, including equity
and debt securities and loans, in its first-tier operating subsidiary is not
limited by this Subpart. Loans made by the savings bank to its operating
subsidiary shall not be subject to Section 6013 of the Act.
3) Upon approval of the Director, a subsidiary of a first-tier operating
subsidiary may be designated as an operating subsidiary; provided that the
lower tier subsidiary is wholly-owned and controlled by the first-tier operating
subsidiary and engages solely in activities that are permitted for a depository
institution or an operating subsidiary of a depository association. The total
investment, including equity and debt securities and loans, by the savings bank
or its first-tier operating subsidiary in the wholly-owned and controlled
lower-tier operating subsidiary is not limited by this Subpart or Section 6013
of the Act.
4) The total investment, including equity and debt securities and
loans, by the savings bank and its first-tier operating subsidiary in a service
corporation or an operating subsidiary that is not wholly-owned and controlled
by the savings bank's first-tier operating subsidiary is subject to the same
limitations under this Subpart that apply to the savings bank's investment in a
service corporation that is not an operating subsidiary.
5) As used in this subsection (c):
"Subsidiary"
means a corporation, limited liability company, partnership, business trust,
joint venture, pool, syndicate or other similar business organization.
"Majority-owned"
means the savings bank owns more than 50% of the voting interest or equivalent
ownership interest of the subsidiary.
"Control"
means effective operating control.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.610 APPROVAL BY THE DIRECTOR
Section 1075.610 Approval by
the Director
a) Except as provided in subsection (b) of this Section, an
application for approval of a service corporation shall be approved by the Director
provided that:
1) its purpose or purposes are reasonably incident to the
accomplishment of the powers conferred upon savings banks by the Act, or are
purposes granted or allowed to service corporations organized or owned by
savings and loan associations; or its sole purpose is to operate as a finance
subsidiary of a savings bank to the extent authorized for finance subsidiaries
of savings and loan associations under the Illinois Savings and Loan Act of
1985 [205 ILCS 105]; and
2) the application for approval of a service corporation
includes: the appropriate fee; a copy of the service corporation's Articles
of Incorporation; a list of proposed shareholders; the fiscal year-end date;
and an undertaking by the service corporation with the continuing conditions
specified in subsection (c) of this Section and in a form prescribed by the Director.
b) An application for approval of a service corporation shall be
denied by the Director in writing if the Director finds that any proposed
shareholder is conducting business in an unsafe manner.
c) Continuing Conditions
1) A service corporation shall not amend its Articles of
Incorporation nor adopt an assumed corporate name without the prior written
approval of the Director. A proposed amendment to Articles of Incorporation not
involving a name change shall be approved unless it is in non-compliance with
subsection (a)(1). A proposed name change shall be approved unless such
proposed name is either deceptively similar to that of a savings bank as
specified in Section 3005(b)(3) of the Act or of a nature which might imply
that the entity is a savings bank.
2) Each service corporation shall cause its affairs to be audited
by a licensed public accountant at least once each fiscal year, and cause the
accountant to deliver a copy of the certified statement to the Director
simultaneously with the delivery of the statement to the service corporation.
3) Each service corporation shall be examined in conjunction with
the examination of its parent savings banks. The Director shall require
additional reports and/or examinations if the Director, or his or her staff
members engaged in examination of the savings bank's monthly report, determine
that more information is needed to determine the viability of the service
corporation.
4) A service corporation shall not acquire any classified items
as defined in Section 1075.585(b) from any financial institution, except that a
service corporation may acquire real estate owned by any savings bank.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.620 INVESTMENT LIMITATIONS
Section 1075.620 Investment
Limitations
a) A savings bank may make investments in capital stock of
service corporations that are 90% or more owned by one or more savings banks in
an amount that shall not exceed 10% of the savings bank's total assets. A
savings bank that has met and maintained the capital levels required for a
savings bank, the deposit accounts of which are insured by the Federal Deposit
Insurance Corporation, may invest an additional 50% of the excess capital
provided that in no event shall a savings bank's maximum investment in service
corporations exceed 20% of its total assets.
b) A savings bank may make investments in capital stock of
service corporations that are at least 51% but less than 90% owned by one or
more savings banks, in an amount not to exceed 1% of the savings bank's total
assets.
c) All loans to service corporations shall be subject to all
lending limitations contained in the Act and this Part, except that:
1) a savings bank may make loans to a wholly owned service
corporation in an amount equal to the savings bank's total capital or in an
amount that exceeds the savings bank's total capital if the excess amount is
fully secured by collateral, of a type upon which the savings bank itself could
lend, of a value determined in accordance with the Act and with rules
promulgated by the Director; and
2) loans shall not be subject to the percentage of asset
limitations of Section 6002(8) of the Act.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.630 INVESTMENTS BY SERVICE CORPORATIONS
Section 1075.630 Investments
by Service Corporations
a) A service corporation may invest its assets in any manner not
expressly prohibited by law, provided the investments are made in the exercise
of reasonable judgment and care under the circumstances then prevailing that
persons of prudence, discretion and intelligence exercise in the management of
their own affairs, not in regard to speculation but in regard to the permanent
disposition of their funds, considering the probable income as well as the
probable safety of their capital.
b) If a service corporation has not been approved, or if approval
is withdrawn, all loans to or investments in the service corporation shall
constitute an unauthorized investment. However, the savings bank shall be
granted a reasonable time within which to dispose of the loans or investments.
c) A basis for withdrawal of approval of a service corporation
exists if:
1) the service corporation is subject to involuntary dissolution
for failure to file annual reports or pay fees pursuant to the Business
Corporation Act [805 ILCS 5]; or
2) the service corporation fails to pay, within 60 days after the
billing date, supervisory fees or examination fees due the Director;
3) the service corporation fails to file, when due, those reports
required by Sections 1075.670 and 1075.680 of this Part;
4) the Director determines that the service corporation is
engaged in activities that are not reasonably incidental to the accomplishment
of the powers conferred upon savings banks by the Act;
5) the investment of any parent savings bank in the respective
service corporations is in excess of the investment limitations set forth at
Section 1075.620 of this Part; or
6) the Director determines that the service corporation is
conducting business in a fraudulent, illegal, or unsafe manner.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.640 OWNERSHIP OF CAPITAL STOCK OF SERVICE CORPORATION
Section 1075.640 Ownership
of Capital Stock of Service Corporation
a) A minimum of 51% of all classes of capital stock of a
first-tier service corporation shall be owned by one or more savings banks,
bank, or savings and loan associations. First-tier service corporation means
any corporation which is 51% or more owned by one or more savings banks, bank,
or savings and loan associations whose purpose or purposes are reasonably
incident to the accomplishment of the powers conferred upon savings banks by the
Act.
b) Subject to approval by the Director, an amount not to exceed
49% of all classes of capital stock of a service corporation may be owned by a
person or persons other than a savings bank. The ownership shall be approved if
the Director finds:
1) the sale or issuance of stock is at no less than the book
value of the stock;
2) if no sale is involved, that the stock issuance to employees
or officers is part of the compensation program documented by a written
employment contract; and
3) the ownership of the stock is subject to a repurchase
agreement that provides that the service corporation has the right of first
refusal to reacquire the stock from the person or persons or the estate of the
person or persons at book value at the time of death or termination of
employment.
c) The book value of the stock shall be determined in accordance
with generally accepted accounting principles by the independent auditor of the
service corporation.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.650 PROHIBITED TRANSACTIONS
Section 1075.650 Prohibited
Transactions
a) Without prior approval of the Director, no service corporation
shall enter into any contract (except an employment contract), grant any loan,
directly or indirectly, to any officer, organization director, individual
stockholder or employee of the service corporation or of its parent savings banks
except upon real estate occupied as a homestead or on the security of a
personal automobile. A service corporation may, without prior approval, enter
into a contract for the sale of real estate to be occupied by any of the
foregoing persons as their bona fide homestead.
b) A service corporation may enter into a contract to purchase an
insurance agency or brokerage in which any of the foregoing persons have an
interest.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.660 DISCLOSURE TO SERVICE CORPORATION
Section 1075.660 Disclosure
to Service Corporation
a) Service corporations shall require as a condition of any
contract, loan, joint venture agreement or partnership agreement, that the
party entering into such relationship with the service corporation disclose the
names and true identity:
1) in the case of trusts, owners of beneficial interests of said
trusts;
2) in the case of corporations, the names and addresses of all
shareholders owning 10 percent or more of the capital stock; and
3) in the case of partnerships, a list of names and addresses of
all partners.
b) Such disclosure shall be certified by the respective trustee,
secretary or general partner. This certification shall become a permanent part
of the file of each such contract, loan, joint venture or partnership
agreement.
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.670 REPORTING REQUIREMENTS
Section 1075.670 Reporting
Requirements
a) Within 45 days after the close of each calendar year, each
service corporation shall submit to the Director a report, in such form as the Director
shall prescribe, setting forth complete and true statements of condition and
operations of the service corporation and of every partnership, joint venture
or corporation in which the service corporation has a cash and/or equity
interest of 50% or more.
b) All corporate subsidiaries, partnerships and joint ventures in
which the service corporation has a cash and/or equity interest of 50% or more
shall, within 15 days after a request by the Director, submit true and correct
copies of all contracts, mortgages, partnership agreements, joint ventures and
loan commitments.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.680 AUDIT REQUIREMENTS
Section 1075.680 Audit
Requirements
a) Each service corporation shall cause its books and records to
be audited at least once annually by an independent licensed public accountant.
Except as provided after this, the report of audit shall be separate from the
report of audit of any parent savings bank.
b) The report of audit of a wholly-owned service corporation may
be consolidated with the report of audit of the parent savings bank provided
that the report sets forth:
1) the auditor's opinion that the activity of the service
corporation does not materially affect the financial position of the parent
savings bank; and
2) all details of consolidation.
c) The auditor shall test compliance with the Act and this Part
and determine the effect that the service corporation has on the financial position
of the parent savings banks.
d) The auditor shall determine and report any facts relating to
any direct or indirect self-dealing by any service corporation officer, organization
director, employee or shareholder other than a savings bank. The auditor shall
also determine and report any facts relating to any direct or indirect conflict
of interest of any officer, organization director, employee or shareholder of a
savings bank holding stock in the service corporation.
e) Any noncompliance with the Act or this Part, self-dealing or
conflict of interest which are discovered during the audit shall be set forth
in the report of audit delivered to the service corporation's board of
directors. The service corporation's board of directors shall promptly report the
noncompliance to the Director and to the board of directors of the parent
savings banks.
f) A copy of the audit report shall be filed with the Director
within 90 days after the audit date, except upon receipt of written notice
setting forth the reason delivery of the report of audit is delayed by
circumstances beyond the control of the service corporation, the Director may
extend the filing date for up to 60 additional days.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
SUBPART G: RELOCATIONS AND BRANCHING
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.700 GENERAL
Section 1075.700 General
a) A branch office of a savings bank is any office other than its
home office, drive-in facility, pedestrian facility, agency office, or a remote
service unit.
b) Any business of a savings bank may be transacted at a branch
office. When a branch office provides any product, it must have all the
resources necessary to support that product offering at the branch location.
c) A savings bank shall not establish a branch office nor change
the location of its home office unless its respective application has been
approved by the Director. An application shall be approved only if the Director
finds that:
1) the office can be established at the proposed location without
undue injury to properly conducted existing savings banks;
2) the policies and financial condition of the applicant are not
a basis for supervisory objection; and
3) the proposed office will open within 12 months of approval
unless occupancy is delayed by circumstances beyond the control of the
applicant and, consequently, additional time is allowed by the Director.
d) A savings bank proposing a change of location of its home
office or branch office may request a waiver of the otherwise applicable
requirements of this Subpart G. The request will be approved only if:
1) the Director can make the same findings as those required at
subsection (c);
2) the applicant demonstrates that the area to be served from the
proposed location is essentially the same as that served from the present
location;
3) the applicant gives the reasons for the change of location;
and
4) the applicant submits a request that sets forth information
sufficient to allow the making of all determinations required by subsection
(d).
e) If requested by the applicant, the Director shall approve a
temporary location of a home office or a branch office if the temporary
location is:
1) in the immediate vicinity of the approved permanent location;
and
2) not more competitive to any other properly conducted existing
savings bank than the approved permanent location.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.705 APPLICATION
Section 1075.705 Application
a) A savings bank may apply for a branch office or for a change
of location of its home office provided that the applicant obtains the
prescribed form of application and form of notice and related instructions from
the Director unless waived pursuant to Section 1075.700(d) of this Part.
b) An application is considered complete and a priority filing
date is established when the Director determines that all required information
has been submitted.
c) Changes to all but material information of the application may
be made up to the time the approval/denial is determined. For purposes of this
Section, material information is defined as but is not limited to:
1) savings bank name;
2) savings bank address;
3) nature and purpose of application; and
4) any other information which if changed, would likely cause the
approval or denial decision to be reversed.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.710 REQUEST FOR PRELIMINARY DETERMINATION
Section 1075.710 Request for
Preliminary Determination
a) A savings bank that intends to file an application for a
branch office or for a change of location of its home office may, before the
filing of the application, submit to the Director written advice of intent to
file the application and request a preliminary determination as to whether
supervisory objection will be raised on the basis of the applicant's policies
and financial condition. Within 30 days following receipt of the advice of
intent, the applicant shall be advised of the Director's decision, and if
applicable, the reason for supervisory objection.
b) If at any time subsequent to preliminary determination the Director
determines that a basis for supervisory objection exists, further processing of
the respective application shall be denied.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.715 PUBLIC NOTICE AND INSPECTION
Section 1075.715 Public
Notice and Inspection
a) At the time of the filing of the application, the applicant shall
publish notice of intent to relocate or establish a branch office. The notice
shall be in form and content as prescribed by the Director. The applicant shall
publish notice in a newspaper printed in the English language having a general
circulation in the applicant's home office community and in the community to be
served from the proposed location.
b) Within 10 days following the date of publication, the
applicant shall furnish the Director with one copy each of the required notices
and the publisher's affidavits of publication.
c) Subject to Section 1075.110(d) of this Part, the application
shall be available for public inspection at the Division, by appointment.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.720 PROTEST
Section 1075.720 Protest
Protests, answers to protests
and other related communications shall be in writing and submitted only as
provided in this Section.
a) Within 10 calendar days following the date of publication of
Notice of Application (or 20 calendar days after the date of publication if
extension is requested in writing within the 10 day period) any person may file
a communication in favor or protest of the application with the Director. Any
person filing a communication shall simultaneously furnish a copy to the
applicant.
b) Within 15 calendar days after receipt of a protest, the
objector and the applicant shall be advised in writing whether the Director
considers the protest to be substantial.
c) No protest shall be considered "substantial" unless
it is in writing, filed on time, and contains at least the following:
1) a summary of the reasons for the protest;
2) the specific matters in the application to which objection is
raised and the reasons for each objection;
3) facts supporting the protest, including relevant economic or
financial data; and
4) adverse effects on the objector that may result from approval
of the application.
d) The Director's determination as to whether a protest is
"substantial" shall be made on the basis of data showing undue injury
to properly conducted existing savings banks and/or data disputing the
propriety of information set forth in the respective application.
e) Within 20 calendar days following the date of notice that a
protest has been considered substantial, the applicant may file an answer to the
protest with the Director.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.725 ORAL ARGUMENT
Section 1075.725 Oral
Argument
a) Oral argument on the merits of an application shall be heard
if:
1) the applicant, or a person who has filed a protest considered
to be substantial, so requests and the request is received by the Director within
10 calendar days after the time for filing answers to all protests has expired;
and
2) the Director, after reviewing the application and other
pertinent information, considers oral argument desirable because of protests that
dispute the propriety of information set forth in the application.
b) Any hearing of oral argument shall be subject to the
appropriate fee and expenses prescribed in Section 1075.100 of this Part. A
transcript of any hearing of oral argument shall be taken and made a part of
the record in the matter.
c) The Director shall mail notice of the date (which shall be at
least 10 calendar days after the mailing), time and place of oral argument to
the applicant and persons who filed protests or other communications. The Director
shall ensure that the time and place of any oral argument are reasonably
convenient to the applicant and the objectors.
d) The Director or any person designated by the Director shall
hear oral argument and determine all matters relating to the conduct of the
hearing. Arguments shall be made in person or by authorized representatives. A
maximum of one hour of oral argument shall be allowed in favor of and against
the application. In hearing oral arguments, the person presiding shall
determine the order of presentation. The parties may agree on a division of
time; otherwise, the person presiding shall make the determination. Arguments
may be consolidated. In the event of multiple substantial protests, the person
presiding may permit additional time for argument and rebuttal. Arguments shall
be based only on the facts and information on file; however, a party may
introduce newly discovered matter by giving a written memorandum of same to the
person presiding when the hearing commences. The memorandum shall include an
affidavit as to why the matter was not previously known and not previously
filed. No party to an oral argument shall be permitted more than one filing of
new matter. If the person presiding rules that there is in fact substantive new
matter, the party introducing it shall be required to provide copies of the
memorandum of the new matter to all parties. If the parties agree to argue on
the basis of the new matter, the hearing shall continue.
e) If any party wishes to file a rebuttal, 10 calendar days shall
be allowed for the submission of the rebuttal, and the person presiding shall
adjourn the hearing and set a date, time and place for it to be reconvened.
Rebuttal to new matter shall not be considered a filing of new matter.
f) If oral argument is heard by a person other than the Director,
that person's findings shall be submitted to the Director, in writing, within
25 calendar days after final adjournment of the hearing. Within 10 calendar
days following receipt of the findings the parties shall be advised, in
writing, of the Director's decision. If the Director presides at the hearing,
the parties to the hearing shall be advised of the decision within 25 calendar
days after the final adjournment of the hearing.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.730 APPLICATION FOR THE MAINTENANCE OF BRANCH OFFICE AFTER CONVERSION, CONSOLIDATION, PURCHASE OF ASSETS OR MERGER
Section 1075.730 Application
for the Maintenance of Branch Office after Conversion, Consolidation, Purchase
of Assets or Merger
a) With written approval of the Director, a savings bank that acquires
an office or offices through merger, purchase, purchase of all assets or
consolidation shall assume the operation of any acquired offices. An existing depository
institution that converts to a savings bank shall maintain all of its offices
existing or approved before the conversion.
b) If the Director has approved a Plan of Conversion from a
savings bank charter for a savings bank or has evidence of a savings bank's
intent to file a Plan of Conversion, he or she shall deny an application for a
branch office.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.735 REDESIGNATION OF OFFICES
Section 1075.735
Redesignation of Offices
A savings bank may designate an
existing branch office as its main business office and designate its existing
main business office as a branch office by submitting an appropriate bylaw
amendment for approval. No other Sections in Subpart G of this Part shall apply
to redesignation of offices.
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.740 TERMINATION OF OPERATION AND/OR CLOSING OF A BRANCH OFFICE
Section 1075.740 Termination
of Operation and/or Closing of a Branch Office
a) A savings bank may offer to sell branch offices to another
savings bank or other depository institution.
1) Before any such sale, a copy of the proposed agreement shall
be submitted to the Director. Within 30 calendar days the Director shall notify
the proposed seller, in writing, as to whether there is supervisory objection
to the proposed sale, or the Director may advise the proposed seller of any
additional information or further review considered necessary to make such a
determination. The Director in considering supervisory objection shall review
the policies and financial condition of the selling savings bank and the
acquiring financial institution.
2) The selling savings bank and, if applicable, the acquiring
financial institution shall submit an appropriate bylaw amendment for the Director's
approval.
b) A savings bank showing justification for termination of
operation and the closing of branch offices may do so with the prior written
approval of the Director. Any request for the closing of any office shall be
subject to the publication requirements of Section 1075.715(a) of this Part.
c) The filing of a request for termination of operation and the
closing of branch offices shall constitute authority for the Director to seek a
successor to assume operation of the branch offices.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.745 AGENCY OFFICES
Section 1075.745 Agency
Offices
a) A savings bank may establish or maintain agency offices which
only service and originate (but do not approve) loans and contracts and/or
manage or sell real estate owned by the savings bank.
b) An agency office shall maintain records of all business it transacts
and transmit copies to a branch or home office of the savings bank.
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.750 REMOTE DRIVE-IN AND/OR REMOTE PEDESTRIAN FACILITIES
Section 1075.750 Remote
Drive-In and/or Remote Pedestrian Facilities
a) A savings bank may, without prior approval of the Director,
establish a remote drive-in and/or remote pedestrian facility in conjunction
with each savings bank business office. Each facility may be designed to
simultaneously accommodate more than one customer.
b) The term "business office" means the business office
premises, including non-remote drive-in and/or non-remote pedestrian facilities
that are those facilities within the boundaries of real estate on which a home
office or any branch office is located and the areas contiguous to the
facility, that the savings bank has the exclusive right as owner or lessee to
use or maintain for ingress or egress or for parking in connection with that
business office.
c) Remote drive-in and remote pedestrian facilities are defined
as follows:
1) A remote drive-in facility is a facility that is not located
on the premises of a business office as defined in subsection (b) and at which
the customer transacts business from a vehicle.
2) A remote pedestrian facility is a facility that is not located
on the premises of a business office as defined in subsection (b) and at which
the customer need not enter an office but may remain outside the structure and
transact business with a teller located inside the structure.
d) Remote drive-in and remote pedestrian facilities may be placed
in a store or location of some other business if the savings bank's quarters
are used exclusively for the conduct of the savings bank's business. There will
be no objection to a remote pedestrian facility that faces on an enclosed mall
and serves pedestrians who remain in the mall while transacting business with
the savings bank.
e) Functions that are routinely performed by the establishing
savings bank's tellers at its business offices may be performed at a remote
drive-in and/or remote pedestrian facility.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
SUBPART H: CAPITAL NOTES AND DEBENTURES
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.800 APPROVAL
Section 1075.800 Approval
No savings bank may issue and
sell its capital notes or debentures without the prior written approval of the Director,
subject to any conditions the Director may impose with regard to safety and
soundness and maintenance of adequate financial condition, especially in areas
of preservation of capital, quality of earnings and adequacy of reserves. A
stock savings bank shall also have the prior approval of a majority of the
shareholders owning a majority of the issued and outstanding shares of the
savings bank to issue convertible capital notes or debentures.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.810 CONVERSION TO STOCK
Section 1075.810 Conversion
to Stock
Capital notes or debentures
issued by a stock savings bank may be converted into shares in accordance with
provisions approved by the Director and contained in the capital notes or
debentures. Convertible capital notes or debentures may be issued without preemptive
rights to existing shareholders if provided by the Articles of Incorporation of
the savings bank and authorized by the Director.
(Source: Amended at 30 Ill.
Reg. 19068, effective December 1, 2006)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.820 PRIORITY OF CLAIM
Section 1075.820 Priority of
Claim
Capital notes and debentures
shall be an unsecured indebtedness of the savings bank and shall be subordinate
to the claims of account holders and all other creditors of the savings bank,
regardless of whether the claims of account holders or other creditors arose
before or after the issuance of such debentures or capital notes. In the event
of liquidation, all account holders and other creditors of the savings bank
shall be entitled to be paid in full before any payment shall be made on
account of principal or interest on capital notes or debentures. Capital notes
and debentures shall contain a statement of the rights and priorities of the
lenders.
SUBPART I: ADMINISTRATIVE HEARING PROCEDURES
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.900 HEARINGS
Section 1075.900 Hearings
All administrative hearings
shall be conducted in accordance with 38 Ill. Adm. Code 100.
(Source: Amended at 46 Ill.
Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.905 DEFINITIONS (REPEALED)
Section 1075.905 Definitions
(Repealed)
(Source: Repealed at 46 Ill.
Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.910 EARLY NEUTRAL EVALUATION (REPEALED)
Section 1075.910 Early
Neutral Evaluation (Repealed)
(Source: Repealed at 46 Ill.
Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.915 CONFERENCE ADJUDICATIVE HEARING (REPEALED)
Section 1075.915 Conference
Adjudicative Hearing (Repealed)
(Source: Repealed at 46 Ill.
Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.920 FILING (REPEALED)
Section 1075.920 Filing (Repealed)
(Source: Repealed at 46 Ill.
Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.925 FORM OF DOCUMENTS (REPEALED)
Section 1075.925 Form of
Documents (Repealed)
(Source: Repealed at 46 Ill. Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.930 COMPUTATION OF TIME (REPEALED)
Section 1075.930 Computation
of Time (Repealed)
(Source:
Repealed at 46 Ill. Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.935 APPEARANCES (REPEALED)
Section 1075.935 Appearances
(Repealed)
(Source: Repealed at 46 Ill. Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.940 NOTICE OF HEARING (REPEALED)
Section 1075.940 Notice of
Hearing (Repealed)
(Source:
Repealed at 46 Ill. Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.945 SERVICE OF THE NOTICE OF HEARING (REPEALED)
Section 1075.945 Service of
the Notice of Hearing (Repealed)
(Source:
Repealed at 46 Ill. Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.950 MOTION AND ANSWER (REPEALED)
Section 1075.950 Motion and
Answer (Repealed)
(Source: Repealed at 46 Ill. Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.955 CONSOLIDATION AND SEVERANCE OF MATTERS ADDITIONAL PARTIES (REPEALED)
Section 1075.955 Consolidation
and Severance of Matters – Additional Parties (Repealed)
(Source:
Repealed at 46 Ill. Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.960 INTERVENTION (REPEALED)
Section 1075.960
Intervention (Repealed)
(Source: Repealed at 46 Ill. Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.965 POSTPONEMENT OR CONTINUANCE OF HEARING (REPEALED)
Section 1075.965
Postponement or Continuance of Hearing (Repealed)
(Source: Repealed at 46 Ill.
Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.970 AUTHORITY OF HEARING OFFICER (REPEALED)
Section 1075.970 Authority
of Hearing Officer (Repealed)
(Source: Repealed at 46 Ill.
Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.975 BIAS OR DISQUALIFICATION OF HEARING OFFICER (REPEALED)
Section 1075.975 Bias or
Disqualification of Hearing Officer (Repealed)
(Source: Repealed at 46 Ill.
Reg. 18013, effective October 27, 2022)
| TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION
PART 1075
SAVINGS BANK ACT
SECTION 1075.980 PREHEARING CONFERENCES (REPEALED)
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