SB2513eng 95TH GENERAL ASSEMBLY



 


 
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1     AN ACT concerning regulation.
 
2     Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
 
4     Section 5. The Illinois Banking Act is amended by changing
5 Sections 2 and 48 as follows:
 
6     (205 ILCS 5/2)  (from Ch. 17, par. 302)
7     Sec. 2. General definitions. In this Act, unless the
8 context otherwise requires, the following words and phrases
9 shall have the following meanings:
10     "Accommodation party" shall have the meaning ascribed to
11 that term in Section 3-419 of the Uniform Commercial Code.
12     "Action" in the sense of a judicial proceeding includes
13 recoupments, counterclaims, set-off, and any other proceeding
14 in which rights are determined.
15     "Affiliate facility" of a bank means a main banking
16 premises or branch of another commonly owned bank. The main
17 banking premises or any branch of a bank may be an "affiliate
18 facility" with respect to one or more other commonly owned
19 banks.
20     "Appropriate federal banking agency" means the Federal
21 Deposit Insurance Corporation, the Federal Reserve Bank of
22 Chicago, or the Federal Reserve Bank of St. Louis, as
23 determined by federal law.

 

 

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1     "Bank" means any person doing a banking business whether
2 subject to the laws of this or any other jurisdiction.
3     A "banking house", "branch", "branch bank" or "branch
4 office" shall mean any place of business of a bank at which
5 deposits are received, checks paid, or loans made, but shall
6 not include any place at which only records thereof are made,
7 posted, or kept. A place of business at which deposits are
8 received, checks paid, or loans made shall not be deemed to be
9 a branch, branch bank, or branch office if the place of
10 business is adjacent to and connected with the main banking
11 premises, or if it is separated from the main banking premises
12 by not more than an alley; provided always that (i) if the
13 place of business is separated by an alley from the main
14 banking premises there is a connection between the two by
15 public or private way or by subterranean or overhead passage,
16 and (ii) if the place of business is in a building not wholly
17 occupied by the bank, the place of business shall not be within
18 any office or room in which any other business or service of
19 any kind or nature other than the business of the bank is
20 conducted or carried on. A place of business at which deposits
21 are received, checks paid, or loans made shall not be deemed to
22 be a branch, branch bank, or branch office (i) of any bank if
23 the place is a terminal established and maintained in
24 accordance with paragraph (17) of Section 5 of this Act, or
25 (ii) of a commonly owned bank by virtue of transactions
26 conducted at that place on behalf of the other commonly owned

 

 

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1 bank under paragraph (23) of Section 5 of this Act if the place
2 is an affiliate facility with respect to the other bank.
3     "Branch of an out-of-state bank" means a branch established
4 or maintained in Illinois by an out-of-state bank as a result
5 of a merger between an Illinois bank and the out-of-state bank
6 that occurs on or after May 31, 1997, or any branch established
7 by the out-of-state bank following the merger.
8     "Bylaws" means the bylaws of a bank that are adopted by the
9 bank's board of directors or shareholders for the regulation
10 and management of the bank's affairs. If the bank operates as a
11 limited liability company, however, "bylaws" means the
12 operating agreement of the bank.
13     "Call report fee" means the fee to be paid to the
14 Commissioner by each State bank pursuant to paragraph (a) of
15 subsection (3) of Section 48 of this Act.
16     "Capital" includes the aggregate of outstanding capital
17 stock and preferred stock.
18     "Cash flow reserve account" means the account within the
19 books and records of the Commissioner of Banks and Real Estate
20 used to record funds designated to maintain a reasonable Bank
21 and Trust Company Fund operating balance to meet agency
22 obligations on a timely basis.
23     "Charter" includes the original charter and all amendments
24 thereto and articles of merger or consolidation.
25     "Commissioner" means the Commissioner of Banks and Real
26 Estate, except that beginning on the effective date of this

 

 

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1 amendatory Act of the 95th General Assembly, all references in
2 this Act to the Commissioner of Banks and Real Estate are
3 deemed, in appropriate contexts, to be references to the
4 Secretary of Financial and Professional Regulation or a person
5 authorized by the Commissioner, the Office of Banks and Real
6 Estate Act, or this Act to act in the Commissioner's stead.
7     "Commonly owned banks" means 2 or more banks that each
8 qualify as a bank subsidiary of the same bank holding company
9 pursuant to Section 18 of the Federal Deposit Insurance Act;
10 "commonly owned bank" refers to one of a group of commonly
11 owned banks but only with respect to one or more of the other
12 banks in the same group.
13     "Community" means a city, village, or incorporated town and
14 also includes the area served by the banking offices of a bank,
15 but need not be limited or expanded to conform to the
16 geographic boundaries of units of local government.
17     "Company" means a corporation, limited liability company,
18 partnership, business trust, association, or similar
19 organization and, unless specifically excluded, includes a
20 "State bank" and a "bank".
21     "Consolidating bank" means a party to a consolidation.
22     "Consolidation" takes place when 2 or more banks, or a
23 trust company and a bank, are extinguished and by the same
24 process a new bank is created, taking over the assets and
25 assuming the liabilities of the banks or trust company passing
26 out of existence.

 

 

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1     "Continuing bank" means a merging bank, the charter of
2 which becomes the charter of the resulting bank.
3     "Converting bank" means a State bank converting to become a
4 national bank, or a national bank converting to become a State
5 bank.
6     "Converting trust company" means a trust company
7 converting to become a State bank.
8     "Court" means a court of competent jurisdiction.
9     "Director" means a member of the board of directors of a
10 bank. In the case of a manager-managed limited liability
11 company, however, "director" means a manager of the bank and,
12 in the case of a member-managed limited liability company,
13 "director" means a member of the bank. The term "director" does
14 not include an advisory director, honorary director, director
15 emeritus, or similar person, unless the person is otherwise
16 performing functions similar to those of a member of the board
17 of directors.
18     "Eligible depository institution" means an insured savings
19 association that is in default, an insured savings association
20 that is in danger of default, a State or national bank that is
21 in default or a State or national bank that is in danger of
22 default, as those terms are defined in this Section, or a new
23 bank as that term defined in Section 11(m) of the Federal
24 Deposit Insurance Act or a bridge bank as that term is defined
25 in Section 11(n) of the Federal Deposit Insurance Act or a new
26 federal savings association authorized under Section

 

 

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1 11(d)(2)(f) of the Federal Deposit Insurance Act.
2     "Fiduciary" means trustee, agent, executor, administrator,
3 committee, guardian for a minor or for a person under legal
4 disability, receiver, trustee in bankruptcy, assignee for
5 creditors, or any holder of similar position of trust.
6     "Financial institution" means a bank, savings and loan
7 association, credit union, or any licensee under the Consumer
8 Installment Loan Act or the Sales Finance Agency Act and, for
9 purposes of Section 48.3, any proprietary network, funds
10 transfer corporation, or other entity providing electronic
11 funds transfer services, or any corporate fiduciary, its
12 subsidiaries, affiliates, parent company, or contractual
13 service provider that is examined by the Commissioner.
14     "Foundation" means the Illinois Bank Examiners' Education
15 Foundation.
16     "General obligation" means a bond, note, debenture,
17 security, or other instrument evidencing an obligation of the
18 government entity that is the issuer that is supported by the
19 full available resources of the issuer, the principal and
20 interest of which is payable in whole or in part by taxation.
21     "Guarantee" means an undertaking or promise to answer for
22 payment of another's debt or performance of another's duty,
23 liability, or obligation whether "payment guaranteed" or
24 "collection guaranteed".
25     "In danger of default" means a State or national bank, a
26 federally chartered insured savings association or an Illinois

 

 

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1 state chartered insured savings association with respect to
2 which the Commissioner or the appropriate federal banking
3 agency has advised the Federal Deposit Insurance Corporation
4 that:
5         (1) in the opinion of the Commissioner or the
6     appropriate federal banking agency,
7             (A) the State or national bank or insured savings
8         association is not likely to be able to meet the
9         demands of the State or national bank's or savings
10         association's obligations in the normal course of
11         business; and
12             (B) there is no reasonable prospect that the State
13         or national bank or insured savings association will be
14         able to meet those demands or pay those obligations
15         without federal assistance; or
16         (2) in the opinion of the Commissioner or the
17     appropriate federal banking agency,
18             (A) the State or national bank or insured savings
19         association has incurred or is likely to incur losses
20         that will deplete all or substantially all of its
21         capital; and
22             (B) there is no reasonable prospect that the
23         capital of the State or national bank or insured
24         savings association will be replenished without
25         federal assistance.
26     "In default" means, with respect to a State or national

 

 

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1 bank or an insured savings association, any adjudication or
2 other official determination by any court of competent
3 jurisdiction, the Commissioner, the appropriate federal
4 banking agency, or other public authority pursuant to which a
5 conservator, receiver, or other legal custodian is appointed
6 for a State or national bank or an insured savings association.
7     "Insured savings association" means any federal savings
8 association chartered under Section 5 of the federal Home
9 Owners' Loan Act and any State savings association chartered
10 under the Illinois Savings and Loan Act of 1985 or a
11 predecessor Illinois statute, the deposits of which are insured
12 by the Federal Deposit Insurance Corporation. The term also
13 includes a savings bank organized or operating under the
14 Savings Bank Act.
15     "Insured savings association in recovery" means an insured
16 savings association that is not an eligible depository
17 institution and that does not meet the minimum capital
18 requirements applicable with respect to the insured savings
19 association.
20     "Issuer" means for purposes of Section 33 every person who
21 shall have issued or proposed to issue any security; except
22 that (1) with respect to certificates of deposit, voting trust
23 certificates, collateral-trust certificates, and certificates
24 of interest or shares in an unincorporated investment trust not
25 having a board of directors (or persons performing similar
26 functions), "issuer" means the person or persons performing the

 

 

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1 acts and assuming the duties of depositor or manager pursuant
2 to the provisions of the trust, agreement, or instrument under
3 which the securities are issued; (2) with respect to trusts
4 other than those specified in clause (1) above, where the
5 trustee is a corporation authorized to accept and execute
6 trusts, "issuer" means the entrusters, depositors, or creators
7 of the trust and any manager or committee charged with the
8 general direction of the affairs of the trust pursuant to the
9 provisions of the agreement or instrument creating the trust;
10 and (3) with respect to equipment trust certificates or like
11 securities, "issuer" means the person to whom the equipment or
12 property is or is to be leased or conditionally sold.
13     "Letter of credit" and "customer" shall have the meanings
14 ascribed to those terms in Section 5-102 of the Uniform
15 Commercial Code.
16     "Main banking premises" means the location that is
17 designated in a bank's charter as its main office.
18     "Maker or obligor" means for purposes of Section 33 the
19 issuer of a security, the promisor in a debenture or other debt
20 security, or the mortgagor or grantor of a trust deed or
21 similar conveyance of a security interest in real or personal
22 property.
23     "Merged bank" means a merging bank that is not the
24 continuing, resulting, or surviving bank in a consolidation or
25 merger.
26     "Merger" includes consolidation.

 

 

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1     "Merging bank" means a party to a bank merger.
2     "Merging trust company" means a trust company party to a
3 merger with a State bank.
4     "Mid-tier bank holding company" means a corporation that
5 (a) owns 100% of the issued and outstanding shares of each
6 class of stock of a State bank, (b) has no other subsidiaries,
7 and (c) 100% of the issued and outstanding shares of the
8 corporation are owned by a parent bank holding company.
9     "Municipality" means any municipality, political
10 subdivision, school district, taxing district, or agency.
11     "National bank" means a national banking association
12 located in this State and after May 31, 1997, means a national
13 banking association without regard to its location.
14     "Out-of-state bank" means a bank chartered under the laws
15 of a state other than Illinois, a territory of the United
16 States, or the District of Columbia.
17     "Parent bank holding company" means a corporation that is a
18 bank holding company as that term is defined in the Illinois
19 Bank Holding Company Act of 1957 and owns 100% of the issued
20 and outstanding shares of a mid-tier bank holding company.
21     "Person" means an individual, corporation, limited
22 liability company, partnership, joint venture, trust, estate,
23 or unincorporated association.
24     "Public agency" means the State of Illinois, the various
25 counties, townships, cities, towns, villages, school
26 districts, educational service regions, special road

 

 

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1 districts, public water supply districts, fire protection
2 districts, drainage districts, levee districts, sewer
3 districts, housing authorities, the Illinois Bank Examiners'
4 Education Foundation, the Chicago Park District, and all other
5 political corporations or subdivisions of the State of
6 Illinois, whether now or hereafter created, whether herein
7 specifically mentioned or not, and shall also include any other
8 state or any political corporation or subdivision of another
9 state.
10     "Public funds" or "public money" means current operating
11 funds, special funds, interest and sinking funds, and funds of
12 any kind or character belonging to, in the custody of, or
13 subject to the control or regulation of the United States or a
14 public agency. "Public funds" or "public money" shall include
15 funds held by any of the officers, agents, or employees of the
16 United States or of a public agency in the course of their
17 official duties and, with respect to public money of the United
18 States, shall include Postal Savings funds.
19     "Published" means, unless the context requires otherwise,
20 the publishing of the notice or instrument referred to in some
21 newspaper of general circulation in the community in which the
22 bank is located at least once each week for 3 successive weeks.
23 Publishing shall be accomplished by, and at the expense of, the
24 bank required to publish. Where publishing is required, the
25 bank shall submit to the Commissioner that evidence of the
26 publication as the Commissioner shall deem appropriate.

 

 

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1     "Qualified financial contract" means any security
2 contract, commodity contract, forward contract, including spot
3 and forward foreign exchange contracts, repurchase agreement,
4 swap agreement, and any similar agreement, any option to enter
5 into any such agreement, including any combination of the
6 foregoing, and any master agreement for such agreements. A
7 master agreement, together with all supplements thereto, shall
8 be treated as one qualified financial contract. The contract,
9 option, agreement, or combination of contracts, options, or
10 agreements shall be reflected upon the books, accounts, or
11 records of the bank, or a party to the contract shall provide
12 documentary evidence of such agreement.
13     "Recorded" means the filing or recording of the notice or
14 instrument referred to in the office of the Recorder of the
15 county wherein the bank is located.
16     "Resulting bank" means the bank resulting from a merger or
17 conversion.
18     "Secretary" means the Secretary of Financial and
19 Professional Regulation, or a person authorized by the
20 Secretary or by this Act to act in the Secretary's stead.
21     "Securities" means stocks, bonds, debentures, notes, or
22 other similar obligations.
23     "Stand-by letter of credit" means a letter of credit under
24 which drafts are payable upon the condition the customer has
25 defaulted in performance of a duty, liability, or obligation.
26     "State bank" means any banking corporation that has a

 

 

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1 banking charter issued by the Commissioner under this Act.
2     "State Banking Board" means the State Banking Board of
3 Illinois.
4     "Subsidiary" with respect to a specified company means a
5 company that is controlled by the specified company. For
6 purposes of paragraphs (8) and (12) of Section 5 of this Act,
7 "control" means the exercise of operational or managerial
8 control of a corporation by the bank, either alone or together
9 with other affiliates of the bank.
10     "Surplus" means the aggregate of (i) amounts paid in excess
11 of the par value of capital stock and preferred stock; (ii)
12 amounts contributed other than for capital stock and preferred
13 stock and allocated to the surplus account; and (iii) amounts
14 transferred from undivided profits.
15     "Tier 1 Capital" and "Tier 2 Capital" have the meanings
16 assigned to those terms in regulations promulgated for the
17 appropriate federal banking agency of a state bank, as those
18 regulations are now or hereafter amended.
19     "Trust company" means a limited liability company or
20 corporation incorporated in this State for the purpose of
21 accepting and executing trusts.
22     "Undivided profits" means undistributed earnings less
23 discretionary transfers to surplus.
24     "Unimpaired capital and unimpaired surplus", for the
25 purposes of paragraph (21) of Section 5 and Sections 32, 33,
26 34, 35.1, 35.2, and 47 of this Act means the sum of the state

 

 

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1 bank's Tier 1 Capital and Tier 2 Capital plus such other
2 shareholder equity as may be included by regulation of the
3 Commissioner. Unimpaired capital and unimpaired surplus shall
4 be calculated on the basis of the date of the last quarterly
5 call report filed with the Commissioner preceding the date of
6 the transaction for which the calculation is made, provided
7 that: (i) when a material event occurs after the date of the
8 last quarterly call report filed with the Commissioner that
9 reduces or increases the bank's unimpaired capital and
10 unimpaired surplus by 10% or more, then the unimpaired capital
11 and unimpaired surplus shall be calculated from the date of the
12 material event for a transaction conducted after the date of
13 the material event; and (ii) if the Commissioner determines for
14 safety and soundness reasons that a state bank should calculate
15 unimpaired capital and unimpaired surplus more frequently than
16 provided by this paragraph, the Commissioner may by written
17 notice direct the bank to calculate unimpaired capital and
18 unimpaired surplus at a more frequent interval. In the case of
19 a state bank newly chartered under Section 13 or a state bank
20 resulting from a merger, consolidation, or conversion under
21 Sections 21 through 26 for which no preceding quarterly call
22 report has been filed with the Commissioner, unimpaired capital
23 and unimpaired surplus shall be calculated for the first
24 calendar quarter on the basis of the effective date of the
25 charter, merger, consolidation, or conversion.
26 (Source: P.A. 92-483, eff. 8-23-01; 93-561, eff. 1-1-04.)
 

 

 

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1     (205 ILCS 5/48)  (from Ch. 17, par. 359)
2     Sec. 48. Secretary's Commissioner's powers; duties. The
3 Secretary Commissioner shall have the powers and authority, and
4 is charged with the duties and responsibilities designated in
5 this Act, and a State bank shall not be subject to any other
6 visitorial power other than as authorized by this Act, except
7 those vested in the courts, or upon prior consultation with the
8 Secretary Commissioner, a foreign bank regulator with an
9 appropriate supervisory interest in the parent or affiliate of
10 a state bank. In the performance of the Secretary's
11 Commissioner's duties:
12     (1) The Commissioner shall call for statements from all
13 State banks as provided in Section 47 at least one time during
14 each calendar quarter.
15     (2) (a) The Commissioner, as often as the Commissioner
16 shall deem necessary or proper, and no less frequently than 18
17 months following the preceding examination, shall appoint a
18 suitable person or persons to make an examination of the
19 affairs of every State bank, except that for every eligible
20 State bank, as defined by regulation, the Commissioner in lieu
21 of the examination may accept on an alternating basis the
22 examination made by the eligible State bank's appropriate
23 federal banking agency pursuant to Section 111 of the Federal
24 Deposit Insurance Corporation Improvement Act of 1991,
25 provided the appropriate federal banking agency has made such

 

 

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1 an examination. A person so appointed shall not be a
2 stockholder or officer or employee of any bank which that
3 person may be directed to examine, and shall have powers to
4 make a thorough examination into all the affairs of the bank
5 and in so doing to examine any of the officers or agents or
6 employees thereof on oath and shall make a full and detailed
7 report of the condition of the bank to the Commissioner. In
8 making the examination the examiners shall include an
9 examination of the affairs of all the affiliates of the bank,
10 as defined in subsection (b) of Section 35.2 of this Act, or
11 subsidiaries of the bank as shall be necessary to disclose
12 fully the conditions of the subsidiaries or affiliates, the
13 relations between the bank and the subsidiaries or affiliates
14 and the effect of those relations upon the affairs of the bank,
15 and in connection therewith shall have power to examine any of
16 the officers, directors, agents, or employees of the
17 subsidiaries or affiliates on oath. After May 31, 1997, the
18 Commissioner may enter into cooperative agreements with state
19 regulatory authorities of other states to provide for
20 examination of State bank branches in those states, and the
21 Commissioner may accept reports of examinations of State bank
22 branches from those state regulatory authorities. These
23 cooperative agreements may set forth the manner in which the
24 other state regulatory authorities may be compensated for
25 examinations prepared for and submitted to the Commissioner.
26     (b) After May 31, 1997, the Commissioner is authorized to

 

 

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1 examine, as often as the Commissioner shall deem necessary or
2 proper, branches of out-of-state banks. The Commissioner may
3 establish and may assess fees to be paid to the Commissioner
4 for examinations under this subsection (b). The fees shall be
5 borne by the out-of-state bank, unless the fees are borne by
6 the state regulatory authority that chartered the out-of-state
7 bank, as determined by a cooperative agreement between the
8 Commissioner and the state regulatory authority that chartered
9 the out-of-state bank.
10     (2.5) Whenever any State bank, any subsidiary or affiliate
11 of a State bank, or after May 31, 1997, any branch of an
12 out-of-state bank causes to be performed, by contract or
13 otherwise, any bank services for itself, whether on or off its
14 premises:
15         (a) that performance shall be subject to examination by
16     the Commissioner to the same extent as if services were
17     being performed by the bank or, after May 31, 1997, branch
18     of the out-of-state bank itself on its own premises; and
19         (b) the bank or, after May 31, 1997, branch of the
20     out-of-state bank shall notify the Commissioner of the
21     existence of a service relationship. The notification
22     shall be submitted with the first statement of condition
23     (as required by Section 47 of this Act) due after the
24     making of the service contract or the performance of the
25     service, whichever occurs first. The Commissioner shall be
26     notified of each subsequent contract in the same manner.

 

 

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1     For purposes of this subsection (2.5), the term "bank
2 services" means services such as sorting and posting of checks
3 and deposits, computation and posting of interest and other
4 credits and charges, preparation and mailing of checks,
5 statements, notices, and similar items, or any other clerical,
6 bookkeeping, accounting, statistical, or similar functions
7 performed for a State bank, including but not limited to
8 electronic data processing related to those bank services.
9     (3) The expense of administering this Act, including the
10 expense of the examinations of State banks as provided in this
11 Act, shall to the extent of the amounts resulting from the fees
12 provided for in paragraphs (a), (a-2), and (b) of this
13 subsection (3) be assessed against and borne by the State
14 banks:
15         (a) Each bank shall pay to the Secretary Commissioner a
16     Call Report Fee which shall be paid in quarterly
17     installments equal to one-fourth of the sum of the annual
18     fixed fee of $800, plus a variable fee based on the assets
19     shown on the quarterly statement of condition delivered to
20     the Secretary Commissioner in accordance with Section 47
21     for the preceding quarter according to the following
22     schedule: 16¢ per $1,000 of the first $5,000,000 of total
23     assets, 15¢ per $1,000 of the next $20,000,000 of total
24     assets, 13¢ per $1,000 of the next $75,000,000 of total
25     assets, 9¢ per $1,000 of the next $400,000,000 of total
26     assets, 7¢ per $1,000 of the next $500,000,000 of total

 

 

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1     assets, and 5¢ per $1,000 of all assets in excess of
2     $1,000,000,000, of the State bank. The Call Report Fee
3     shall be calculated by the Secretary Commissioner and
4     billed to the banks for remittance at the time of the
5     quarterly statements of condition provided for in Section
6     47. The Secretary Commissioner may require payment of the
7     fees provided in this Section by an electronic transfer of
8     funds or an automatic debit of an account of each of the
9     State banks. In case more than one examination of any bank
10     is deemed by the Secretary Commissioner to be necessary in
11     any examination frequency cycle specified in subsection
12     2(a) of this Section, and is performed at his direction,
13     the Secretary Commissioner may assess a reasonable
14     additional fee to recover the cost of the additional
15     examination; provided, however, that an examination
16     conducted at the request of the State Treasurer pursuant to
17     the Uniform Disposition of Unclaimed Property Act shall not
18     be deemed to be an additional examination under this
19     Section. In lieu of the method and amounts set forth in
20     this paragraph (a) for the calculation of the Call Report
21     Fee, the Secretary Commissioner may specify by rule that
22     the Call Report Fees provided by this Section may be
23     assessed semiannually or some other period and may provide
24     in the rule the formula to be used for calculating and
25     assessing the periodic Call Report Fees to be paid by State
26     banks. For the fiscal year beginning July 1, 2007, and

 

 

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1     continuing thereafter through January 10, 2011, the
2     Secretary shall adopt emergency and general rules to adjust
3     regulatory fee rates to an amount that shall not exceed by
4     more than 13.5% the rates in effect prior to the escalation
5     in rates implemented by an amendment to 38 Ill. Adm. Code
6     375 published in 27 Ill. Reg. 16024, Oct. 10, 2003. The
7     adoption of emergency rules authorized by this subsection
8     (3) shall be deemed necessary for the public interest,
9     safety, and welfare, in order to provide for the
10     expeditious and timely implementation of the State's
11     fiscal year budget through the transfer from the Bank and
12     Trust Company Fund to the General Revenue Fund authorized
13     by this amendatory Act of the 95th General Assembly.
14         (a-1) If in the opinion of the Commissioner an
15     emergency exists or appears likely, the Commissioner may
16     assign an examiner or examiners to monitor the affairs of a
17     State bank with whatever frequency he deems appropriate,
18     including but not limited to a daily basis. The reasonable
19     and necessary expenses of the Commissioner during the
20     period of the monitoring shall be borne by the subject
21     bank. The Commissioner shall furnish the State bank a
22     statement of time and expenses if requested to do so within
23     30 days of the conclusion of the monitoring period.
24         (a-2) On and after January 1, 1990, the reasonable and
25     necessary expenses of the Commissioner during examination
26     of the performance of electronic data processing services

 

 

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1     under subsection (2.5) shall be borne by the banks for
2     which the services are provided. An amount, based upon a
3     fee structure prescribed by the Commissioner, shall be paid
4     by the banks or, after May 31, 1997, branches of
5     out-of-state banks receiving the electronic data
6     processing services along with the Call Report Fee assessed
7     under paragraph (a) of this subsection (3).
8         (a-3) After May 31, 1997, the reasonable and necessary
9     expenses of the Commissioner during examination of the
10     performance of electronic data processing services under
11     subsection (2.5) at or on behalf of branches of
12     out-of-state banks shall be borne by the out-of-state
13     banks, unless those expenses are borne by the state
14     regulatory authorities that chartered the out-of-state
15     banks, as determined by cooperative agreements between the
16     Commissioner and the state regulatory authorities that
17     chartered the out-of-state banks.
18         (b) "Fiscal year" for purposes of this Section 48 is
19     defined as a period beginning July 1 of any year and ending
20     June 30 of the next year. The Commissioner shall receive
21     for each fiscal year, commencing with the fiscal year
22     ending June 30, 1987, a contingent fee equal to the lesser
23     of the aggregate of the fees paid by all State banks under
24     paragraph (a) of subsection (3) for that year, or the
25     amount, if any, whereby the aggregate of the administration
26     expenses, as defined in paragraph (c), for that fiscal year

 

 

SB2513 Engrossed - 22 - LRB095 18312 MJR 44396 b

1     exceeds the sum of the aggregate of the fees payable by all
2     State banks for that year under paragraph (a) of subsection
3     (3), plus any amounts transferred into the Bank and Trust
4     Company Fund from the State Pensions Fund for that year,
5     plus all other amounts collected by the Commissioner for
6     that year under any other provision of this Act, plus the
7     aggregate of all fees collected for that year by the
8     Commissioner under the Corporate Fiduciary Act, excluding
9     the receivership fees provided for in Section 5-10 of the
10     Corporate Fiduciary Act, and the Foreign Banking Office
11     Act. The aggregate amount of the contingent fee thus
12     arrived at for any fiscal year shall be apportioned
13     amongst, assessed upon, and paid by the State banks and
14     foreign banking corporations, respectively, in the same
15     proportion that the fee of each under paragraph (a) of
16     subsection (3), respectively, for that year bears to the
17     aggregate for that year of the fees collected under
18     paragraph (a) of subsection (3). The aggregate amount of
19     the contingent fee, and the portion thereof to be assessed
20     upon each State bank and foreign banking corporation,
21     respectively, shall be determined by the Commissioner and
22     shall be paid by each, respectively, within 120 days of the
23     close of the period for which the contingent fee is
24     computed and is payable, and the Commissioner shall give 20
25     days advance notice of the amount of the contingent fee
26     payable by the State bank and of the date fixed by the

 

 

SB2513 Engrossed - 23 - LRB095 18312 MJR 44396 b

1     Commissioner for payment of the fee.
2         (c) The "administration expenses" for any fiscal year
3     shall mean the ordinary and contingent expenses for that
4     year incident to making the examinations provided for by,
5     and for otherwise administering, this Act, the Corporate
6     Fiduciary Act, excluding the expenses paid from the
7     Corporate Fiduciary Receivership account in the Bank and
8     Trust Company Fund, the Foreign Banking Office Act, the
9     Electronic Fund Transfer Act, and the Illinois Bank
10     Examiners' Education Foundation Act, including all
11     salaries and other compensation paid for personal services
12     rendered for the State by officers or employees of the
13     State, including the Commissioner and the Deputy
14     Commissioners, all expenditures for telephone and
15     telegraph charges, postage and postal charges, office
16     stationery, supplies and services, and office furniture
17     and equipment, including typewriters and copying and
18     duplicating machines and filing equipment, surety bond
19     premiums, and travel expenses of those officers and
20     employees, employees, expenditures or charges for the
21     acquisition, enlargement or improvement of, or for the use
22     of, any office space, building, or structure, or
23     expenditures for the maintenance thereof or for furnishing
24     heat, light, or power with respect thereto, all to the
25     extent that those expenditures are directly incidental to
26     such examinations or administration. The Commissioner

 

 

SB2513 Engrossed - 24 - LRB095 18312 MJR 44396 b

1     shall not be required by paragraphs (c) or (d-1) of this
2     subsection (3) to maintain in any fiscal year's budget
3     appropriated reserves for accrued vacation and accrued
4     sick leave that is required to be paid to employees of the
5     Commissioner upon termination of their service with the
6     Commissioner in an amount that is more than is reasonably
7     anticipated to be necessary for any anticipated turnover in
8     employees, whether due to normal attrition or due to
9     layoffs, terminations, or resignations.
10         (d) The aggregate of all fees collected by the
11     Secretary Commissioner under this Act, the Corporate
12     Fiduciary Act, or the Foreign Banking Office Act on and
13     after July 1, 1979, shall be paid promptly after receipt of
14     the same, accompanied by a detailed statement thereof, into
15     the State treasury and shall be set apart in a special fund
16     to be known as the "Bank and Trust Company Fund", except as
17     provided in paragraph (c) of subsection (11) of this
18     Section. All earnings received from investments of funds in
19     the Bank and Trust Company Fund shall be deposited in the
20     Bank and Trust Company Fund and may be used for the same
21     purposes as fees deposited in that Fund. The amount from
22     time to time deposited into the Bank and Trust Company Fund
23     shall be used: (i) to offset the ordinary administrative
24     expenses of the Secretary Commissioner of Banks and Real
25     Estate as defined in this Section or (ii) as a credit
26     against fees under paragraph (d-1) of this subsection (3).

 

 

SB2513 Engrossed - 25 - LRB095 18312 MJR 44396 b

1     Nothing in this amendatory Act of 1979 shall prevent
2     continuing the practice of paying expenses involving
3     salaries, retirement, social security, and State-paid
4     insurance premiums of State officers by appropriations
5     from the General Revenue Fund. However, the General Revenue
6     Fund shall be reimbursed for those payments made on and
7     after July 1, 1979, by an annual transfer of funds from the
8     Bank and Trust Company Fund. Moneys in the Bank and Trust
9     Company Fund may be transferred to the Professions Indirect
10     Cost Fund, as authorized under Section 2105-300 of the
11     Department of Professional Regulation Law of the Civil
12     Administrative Code of Illinois. Notwithstanding
13     provisions in the State Finance Act, as now or hereafter
14     amended, or any other law to the contrary: (A) the sum of
15     $18,788,847 shall be transferred from the Bank and Trust
16     Company Fund to the General Revenue Fund on the effective
17     date of this amendatory Act of the 95th General Assembly,
18     or as soon thereafter as practical; (B) the Governor may,
19     during any fiscal year through January 10, 2011, from time
20     to time direct the State Treasurer and Comptroller to
21     transfer a specified sum not exceeding 10% of the revenues
22     to be deposited into the Bank and Trust Company Fund during
23     that fiscal year from that Fund to the General Revenue Fund
24     in order to help defray the State's operating costs for the
25     fiscal year; and (C) the total sum transferred during any
26     fiscal year through January 10, 2011, from the Bank and

 

 

SB2513 Engrossed - 26 - LRB095 18312 MJR 44396 b

1     Trust Company Fund to the General Revenue Fund pursuant to
2     provision (B) of paragraph (d) of this subsection (3) shall
3     not exceed during any fiscal year 10% of the revenues to be
4     deposited into the Bank and Trust Company Fund during that
5     fiscal year.
6         The State Treasurer and Comptroller shall transfer the
7     amounts designated under this Section as soon as may be
8     practicable after receiving the direction to transfer from
9     the Governor.
10         (d-1) Adequate funds shall be available in the Bank and
11     Trust Company Fund to permit the timely payment of
12     administration expenses. In each fiscal year the total
13     administration expenses shall be deducted from the total
14     fees collected by the Commissioner and the remainder
15     transferred into the Cash Flow Reserve Account, unless the
16     balance of the Cash Flow Reserve Account prior to the
17     transfer equals or exceeds one-fourth of the total initial
18     appropriations from the Bank and Trust Company Fund for the
19     subsequent year, in which case the remainder shall be
20     credited to State banks and foreign banking corporations
21     and applied against their fees for the subsequent year. The
22     amount credited to each State bank and foreign banking
23     corporation shall be in the same proportion as the Call
24     Report Fees paid by each for the year bear to the total
25     Call Report Fees collected for the year. If, after a
26     transfer to the Cash Flow Reserve Account is made or if no

 

 

SB2513 Engrossed - 27 - LRB095 18312 MJR 44396 b

1     remainder is available for transfer, the balance of the
2     Cash Flow Reserve Account is less than one-fourth of the
3     total initial appropriations for the subsequent year and
4     the amount transferred is less than 5% of the total Call
5     Report Fees for the year, additional amounts needed to make
6     the transfer equal to 5% of the total Call Report Fees for
7     the year shall be apportioned amongst, assessed upon, and
8     paid by the State banks and foreign banking corporations in
9     the same proportion that the Call Report Fees of each,
10     respectively, for the year bear to the total Call Report
11     Fees collected for the year. The additional amounts
12     assessed shall be transferred into the Cash Flow Reserve
13     Account. For purposes of this paragraph (d-1), the
14     calculation of the fees collected by the Commissioner shall
15     exclude the receivership fees provided for in Section 5-10
16     of the Corporate Fiduciary Act.
17         (e) The Commissioner may upon request certify to any
18     public record in his keeping and shall have authority to
19     levy a reasonable charge for issuing certifications of any
20     public record in his keeping.
21         (f) In addition to fees authorized elsewhere in this
22     Act, the Commissioner may, in connection with a review,
23     approval, or provision of a service, levy a reasonable
24     charge to recover the cost of the review, approval, or
25     service.
26     (4) Nothing contained in this Act shall be construed to

 

 

SB2513 Engrossed - 28 - LRB095 18312 MJR 44396 b

1 limit the obligation relative to examinations and reports of
2 any State bank, deposits in which are to any extent insured by
3 the United States or any agency thereof, nor to limit in any
4 way the powers of the Commissioner with reference to
5 examinations and reports of that bank.
6     (5) The nature and condition of the assets in or investment
7 of any bonus, pension, or profit sharing plan for officers or
8 employees of every State bank or, after May 31, 1997, branch of
9 an out-of-state bank shall be deemed to be included in the
10 affairs of that State bank or branch of an out-of-state bank
11 subject to examination by the Commissioner under the provisions
12 of subsection (2) of this Section, and if the Commissioner
13 shall find from an examination that the condition of or
14 operation of the investments or assets of the plan is unlawful,
15 fraudulent, or unsafe, or that any trustee has abused his
16 trust, the Commissioner shall, if the situation so found by the
17 Commissioner shall not be corrected to his satisfaction within
18 60 days after the Commissioner has given notice to the board of
19 directors of the State bank or out-of-state bank of his
20 findings, report the facts to the Attorney General who shall
21 thereupon institute proceedings against the State bank or
22 out-of-state bank, the board of directors thereof, or the
23 trustees under such plan as the nature of the case may require.
24     (6) The Commissioner shall have the power:
25         (a) To promulgate reasonable rules for the purpose of
26     administering the provisions of this Act.

 

 

SB2513 Engrossed - 29 - LRB095 18312 MJR 44396 b

1         (a-5) To impose conditions on any approval issued by
2     the Commissioner if he determines that the conditions are
3     necessary or appropriate. These conditions shall be
4     imposed in writing and shall continue in effect for the
5     period prescribed by the Commissioner.
6         (b) To issue orders against any person, if the
7     Commissioner has reasonable cause to believe that an unsafe
8     or unsound banking practice has occurred, is occurring, or
9     is about to occur, if any person has violated, is
10     violating, or is about to violate any law, rule, or written
11     agreement with the Commissioner, or for the purpose of
12     administering the provisions of this Act and any rule
13     promulgated in accordance with this Act.
14         (b-1) To enter into agreements with a bank establishing
15     a program to correct the condition of the bank or its
16     practices.
17         (c) To appoint hearing officers to execute any of the
18     powers granted to the Commissioner under this Section for
19     the purpose of administering this Act and any rule
20     promulgated in accordance with this Act and otherwise to
21     authorize, in writing, an officer or employee of the Office
22     of Banks and Real Estate to exercise his powers under this
23     Act.
24         (d) To subpoena witnesses, to compel their attendance,
25     to administer an oath, to examine any person under oath,
26     and to require the production of any relevant books,

 

 

SB2513 Engrossed - 30 - LRB095 18312 MJR 44396 b

1     papers, accounts, and documents in the course of and
2     pursuant to any investigation being conducted, or any
3     action being taken, by the Commissioner in respect of any
4     matter relating to the duties imposed upon, or the powers
5     vested in, the Commissioner under the provisions of this
6     Act or any rule promulgated in accordance with this Act.
7         (e) To conduct hearings.
8     (7) Whenever, in the opinion of the Commissioner, any
9 director, officer, employee, or agent of a State bank or any
10 subsidiary or bank holding company of the bank or, after May
11 31, 1997, of any branch of an out-of-state bank or any
12 subsidiary or bank holding company of the bank shall have
13 violated any law, rule, or order relating to that bank or any
14 subsidiary or bank holding company of the bank, shall have
15 obstructed or impeded any examination or investigation by the
16 Commissioner, shall have engaged in an unsafe or unsound
17 practice in conducting the business of that bank or any
18 subsidiary or bank holding company of the bank, or shall have
19 violated any law or engaged or participated in any unsafe or
20 unsound practice in connection with any financial institution
21 or other business entity such that the character and fitness of
22 the director, officer, employee, or agent does not assure
23 reasonable promise of safe and sound operation of the State
24 bank, the Commissioner may issue an order of removal. If, in
25 the opinion of the Commissioner, any former director, officer,
26 employee, or agent of a State bank or any subsidiary or bank

 

 

SB2513 Engrossed - 31 - LRB095 18312 MJR 44396 b

1 holding company of the bank, prior to the termination of his or
2 her service with that bank or any subsidiary or bank holding
3 company of the bank, violated any law, rule, or order relating
4 to that State bank or any subsidiary or bank holding company of
5 the bank, obstructed or impeded any examination or
6 investigation by the Commissioner, engaged in an unsafe or
7 unsound practice in conducting the business of that bank or any
8 subsidiary or bank holding company of the bank, or violated any
9 law or engaged or participated in any unsafe or unsound
10 practice in connection with any financial institution or other
11 business entity such that the character and fitness of the
12 director, officer, employee, or agent would not have assured
13 reasonable promise of safe and sound operation of the State
14 bank, the Commissioner may issue an order prohibiting that
15 person from further service with a bank or any subsidiary or
16 bank holding company of the bank as a director, officer,
17 employee, or agent. An order issued pursuant to this subsection
18 shall be served upon the director, officer, employee, or agent.
19 A copy of the order shall be sent to each director of the bank
20 affected by registered mail. The person affected by the action
21 may request a hearing before the State Banking Board within 10
22 days after receipt of the order. The hearing shall be held by
23 the Board within 30 days after the request has been received by
24 the Board. The Board shall make a determination approving,
25 modifying, or disapproving the order of the Commissioner as its
26 final administrative decision. If a hearing is held by the

 

 

SB2513 Engrossed - 32 - LRB095 18312 MJR 44396 b

1 Board, the Board shall make its determination within 60 days
2 from the conclusion of the hearing. Any person affected by a
3 decision of the Board under this subsection (7) of Section 48
4 of this Act may have the decision reviewed only under and in
5 accordance with the Administrative Review Law and the rules
6 adopted pursuant thereto. A copy of the order shall also be
7 served upon the bank of which he is a director, officer,
8 employee, or agent, whereupon he shall cease to be a director,
9 officer, employee, or agent of that bank. The Commissioner may
10 institute a civil action against the director, officer, or
11 agent of the State bank or, after May 31, 1997, of the branch
12 of the out-of-state bank against whom any order provided for by
13 this subsection (7) of this Section 48 has been issued, and
14 against the State bank or, after May 31, 1997, out-of-state
15 bank, to enforce compliance with or to enjoin any violation of
16 the terms of the order. Any person who has been the subject of
17 an order of removal or an order of prohibition issued by the
18 Commissioner under this subsection or Section 5-6 of the
19 Corporate Fiduciary Act may not thereafter serve as director,
20 officer, employee, or agent of any State bank or of any branch
21 of any out-of-state bank, or of any corporate fiduciary, as
22 defined in Section 1-5.05 of the Corporate Fiduciary Act, or of
23 any other entity that is subject to licensure or regulation by
24 the Commissioner or the Office of Banks and Real Estate unless
25 the Commissioner has granted prior approval in writing.
26     For purposes of this paragraph (7), "bank holding company"

 

 

SB2513 Engrossed - 33 - LRB095 18312 MJR 44396 b

1 has the meaning prescribed in Section 2 of the Illinois Bank
2 Holding Company Act of 1957.
3     (8) The Commissioner may impose civil penalties of up to
4 $10,000 against any person for each violation of any provision
5 of this Act, any rule promulgated in accordance with this Act,
6 any order of the Commissioner, or any other action which in the
7 Commissioner's discretion is an unsafe or unsound banking
8 practice.
9     (9) The Commissioner may impose civil penalties of up to
10 $100 against any person for the first failure to comply with
11 reporting requirements set forth in the report of examination
12 of the bank and up to $200 for the second and subsequent
13 failures to comply with those reporting requirements.
14     (10) All final administrative decisions of the
15 Commissioner hereunder shall be subject to judicial review
16 pursuant to the provisions of the Administrative Review Law.
17 For matters involving administrative review, venue shall be in
18 either Sangamon County or Cook County.
19     (11) The endowment fund for the Illinois Bank Examiners'
20 Education Foundation shall be administered as follows:
21         (a) (Blank).
22         (b) The Foundation is empowered to receive voluntary
23     contributions, gifts, grants, bequests, and donations on
24     behalf of the Illinois Bank Examiners' Education
25     Foundation from national banks and other persons for the
26     purpose of funding the endowment of the Illinois Bank

 

 

SB2513 Engrossed - 34 - LRB095 18312 MJR 44396 b

1     Examiners' Education Foundation.
2         (c) The aggregate of all special educational fees
3     collected by the Commissioner and property received by the
4     Commissioner on behalf of the Illinois Bank Examiners'
5     Education Foundation under this subsection (11) on or after
6     June 30, 1986, shall be either (i) promptly paid after
7     receipt of the same, accompanied by a detailed statement
8     thereof, into the State Treasury and shall be set apart in
9     a special fund to be known as "The Illinois Bank Examiners'
10     Education Fund" to be invested by either the Treasurer of
11     the State of Illinois in the Public Treasurers' Investment
12     Pool or in any other investment he is authorized to make or
13     by the Illinois State Board of Investment as the board of
14     trustees of the Illinois Bank Examiners' Education
15     Foundation may direct or (ii) deposited into an account
16     maintained in a commercial bank or corporate fiduciary in
17     the name of the Illinois Bank Examiners' Education
18     Foundation pursuant to the order and direction of the Board
19     of Trustees of the Illinois Bank Examiners' Education
20     Foundation.
21     (12) (Blank).
22 (Source: P.A. 94-91, eff. 7-1-05.)
 
23     Section 10. The Illinois Savings and Loan Act of 1985 is
24 amended by adding Section 1-10.39 and by changing Sections 7-3
25 and 7-19.1 as follows:
 

 

 

SB2513 Engrossed - 35 - LRB095 18312 MJR 44396 b

1     (205 ILCS 105/1-10.39 new)
2     Sec. 1-10.39. Secretary of the Department of Financial and
3 Professional Regulation. For purposes of this Act, "Secretary"
4 means the Secretary of the Department of Financial and
5 Professional Regulation, or a person authorized by the
6 Secretary or by this Act to act in the Secretary's stead.
 
7     (205 ILCS 105/7-3)  (from Ch. 17, par. 3307-3)
8     Sec. 7-3. Personnel, records, files, actions and duties,
9 etc.
10     (a) The Secretary Commissioner shall appoint, subject to
11 applicable provisions of the Personnel Code, a supervisor, such
12 examiners, employees, experts and special assistants as may be
13 necessary to carry out effectively this Act. The Secretary
14 Commissioner shall require each supervisor, examiner, expert
15 and special assistant employed or appointed by him to give
16 bond, with security to be approved by the Secretary
17 Commissioner, not less in any case than $15,000, conditioned
18 for the faithful discharge of his duties. The premium on such
19 bond shall be paid by the Secretary Commissioner from funds
20 appropriated for that purpose. The bond, along with
21 verification of payment of the premium on such bond, shall be
22 filed in the office of the Secretary of State.
23     (b) The Secretary Commissioner shall have the following
24 duties and powers:

 

 

SB2513 Engrossed - 36 - LRB095 18312 MJR 44396 b

1     (1) To exercise the rights, powers and duties set forth in
2 this Act or in any other related Act;
3     (2) To establish such regulations as may be reasonable or
4 necessary to accomplish the purposes of this Act;
5     (3) To direct and supervise all the administrative and
6 technical activities of this office and create an Advisory
7 Committee which upon request will make recommendations to him;
8     (4) To make an annual report regarding the work of his
9 office as he may consider desirable to the Governor, or as the
10 Governor may request;
11     (5) To cause a suit to be filed in his name to enforce any
12 law of this State that applies to an association, subsidiary of
13 an association, or holding company operating under this Act and
14 shall include the enforcement of any obligation of the
15 officers, directors or employees of any association;
16     (6) To prescribe a uniform manner in which the books and
17 records of every association are to be maintained; and
18     (7) To establish reasonable and rationally based fee
19 structures for each association and holding company operating
20 under this Act and for their service corporations and
21 subsidiaries, which fees shall include but not be limited to
22 annual fees, application fees, regular and special examination
23 fees, and such other fees as the Secretary Commissioner
24 establishes and demonstrates to be directly resultant from his
25 responsibilities under this Act and as are directly
26 attributable to individual entities operating under this Act.

 

 

SB2513 Engrossed - 37 - LRB095 18312 MJR 44396 b

1 For the fiscal year beginning July 1, 2007, and continuing
2 thereafter through January 10, 2011, the Secretary shall adopt
3 emergency and general rules to adjust regulatory fee rates to
4 an amount that shall not exceed by more than 13.5% the rates in
5 effect prior to the escalation in rates implemented by an
6 amendment to 38 Ill. Adm. Code 1000 published in 27 Ill. Reg.
7 16029, Oct. 10, 2003. The adoption of emergency rules
8 authorized by this subsection (b) shall be deemed necessary for
9 the public interest, safety, and welfare, in order to provide
10 for the expeditious and timely implementation of the State's
11 fiscal year budget through the transfer from the Savings and
12 Residential Finance Regulatory Fund to the General Revenue Fund
13 authorized by this amendatory Act of the 95th General Assembly.
14 (Source: P.A. 85-313.)
 
15     (205 ILCS 105/7-19.1)  (from Ch. 17, par. 3307-19.1)
16     Sec. 7-19.1. Savings and Residential Finance Regulatory
17 Fund.
18     (a) The aggregate of all fees collected by the Secretary
19 Commissioner under this Act shall be paid promptly after
20 receipt of the same, accompanied by a detailed statement
21 thereof, into the State treasury and shall be set apart in the
22 Savings and Residential Finance Regulatory Fund, a special fund
23 hereby created in the State treasury. The amounts deposited
24 into the Fund shall be used for the ordinary and contingent
25 expenses of the Department of Financial and Professional

 

 

SB2513 Engrossed - 38 - LRB095 18312 MJR 44396 b

1 Regulation and the Division of Banking, or their successors, in
2 administering and enforcing the Illinois Savings and Loan Act
3 of 1985, the Savings Bank Act, and the Residential Mortgage
4 License Act of 1987 and other laws, rules, and regulations as
5 may apply to the administration and enforcement of the
6 foregoing laws, rules, and regulations as amended from time to
7 time Office of Banks and Real Estate. Nothing in this Act shall
8 prevent continuing the practice of paying expenses involving
9 salaries, retirement, social security, and State-paid
10 insurance of State officers by appropriation from the General
11 Revenue Fund.
12     (b) Except as otherwise provided in subsection (b-5),
13 moneys in the Savings and Residential Finance Regulatory Fund
14 may not be appropriated, assigned, or transferred to another
15 State fund. The moneys in the Fund shall be for the sole
16 benefit of the institutions assessed.
17     (b-5) Moneys in the Savings and Residential Finance
18 Regulatory Fund may be transferred to the Professions Indirect
19 Cost Fund, as authorized under Section 2105-300 of the
20 Department of Professional Regulation Law of the Civil
21 Administrative Code of Illinois.
22     (b-10) Notwithstanding provisions in the State Finance
23 Act, as now or hereafter amended, or any other law to the
24 contrary: (i) The sum of $27,481,638 shall be transferred from
25 the Savings and Residential Finance Regulatory Fund to the
26 General Revenue Fund on the effective date of this amendatory

 

 

SB2513 Engrossed - 39 - LRB095 18312 MJR 44396 b

1 Act of the 95th General Assembly, or as soon thereafter as
2 practical; (ii) the Governor may, during any fiscal year
3 through January 10, 2011, from time to time direct the State
4 Treasurer and Comptroller to transfer a specified sum not
5 exceeding 10% of the revenues to be deposited into the Savings
6 and Residential Finance Regulatory Fund during that fiscal year
7 from that Fund to the General Revenue Fund in order to help
8 defray the State's operating costs for the fiscal year; and
9 (iii) the total sum transferred during any fiscal year through
10 January 10, 2011, from the Savings and Residential Finance
11 Regulatory Fund to the General Revenue Fund pursuant to item
12 (ii) of this subsection (b-10) shall not exceed during any
13 fiscal year 10% of the revenues to be deposited into the
14 Savings and Residential Finance Regulatory Fund during that
15 fiscal year.
16     The State Treasurer and Comptroller shall transfer the
17 amounts designated under this Section as soon as may be
18 practicable after receiving the direction to transfer from the
19 Governor.
20     (c) All earnings received from investments of funds in the
21 Savings and Residential Finance Regulatory Fund shall be
22 deposited into the Savings and Residential Finance Regulatory
23 Fund and may be used for the same purposes as fees deposited
24 into that Fund.
25     (d) When the balance in the Savings and Residential Finance
26 Regulatory Fund at the end of a fiscal year apportioned to the

 

 

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1 fees collected under the Illinois Savings and Loan Act of 1985
2 and the Savings Bank Act exceeds 25% of the total actual
3 administrative and operational expenses incurred by the State
4 for that fiscal year in administering and enforcing the
5 Illinois Savings and Loan Act of 1985 and the Savings Bank Act
6 and such other laws, rules, and regulations as may apply to the
7 administration and enforcement of the foregoing laws, rules,
8 and regulations, the excess shall be credited to the
9 appropriate institutions and entities and applied against
10 their regulatory fees for the subsequent fiscal year. The
11 amount credited to each institution or entity shall be in the
12 same proportion that the regulatory fees paid by the
13 institution or entity for the fiscal year in which the excess
14 is produced bear to the aggregate amount of all fees collected
15 by the Secretary under the Illinois Savings and Loan Act of
16 1985 and the Savings Bank Act for the same fiscal year. For the
17 purpose of this Section, "fiscal year" means the period
18 beginning July 1 of any year and ending June 30 of the next
19 calendar year.
20 (Source: P.A. 94-91, eff. 7-1-05.)
 
21     Section 15. The Savings Bank Act is amended by adding
22 Section 1007.135 and by changing Section 9002 as follows:
 
23     (205 ILCS 205/1007.135 new)
24     Sec. 1007.135. Secretary of the Department of Financial and

 

 

SB2513 Engrossed - 41 - LRB095 18312 MJR 44396 b

1 Professional Regulation. "Secretary" means the Secretary of
2 the Department of Financial and Professional Regulation, or a
3 person authorized by the Secretary or by this Act to act in the
4 Secretary's stead.
 
5     (205 ILCS 205/9002)  (from Ch. 17, par. 7309-2)
6     Sec. 9002. Powers of Secretary Commissioner. The Secretary
7 Commissioner shall have the following powers and duties:
8     (1) To exercise the rights, powers, and duties set forth in
9 this Act or in any related Act.
10     (2) To establish regulations as may be reasonable or
11 necessary to accomplish the purposes of this Act.
12     (3) To make an annual report regarding the work of his
13 office under this Act as he may consider desirable to the
14 Governor, or as the Governor may request.
15     (4) To cause a suit to be filed in his name to enforce any
16 law of this State that applies to savings banks, their service
17 corporations, subsidiaries, affiliates, or holding companies
18 operating under this Act, including the enforcement of any
19 obligation of the officers, directors, agents, or employees of
20 any savings bank.
21     (5) To prescribe a uniform manner in which the books and
22 records of every savings bank are to be maintained.
23     (6) To establish a reasonable fee structure for savings
24 banks and holding companies operating under this Act and for
25 their service corporations and subsidiaries. The fees shall

 

 

SB2513 Engrossed - 42 - LRB095 18312 MJR 44396 b

1 include, but not be limited to, annual fees, application fees,
2 regular and special examination fees, and other fees as the
3 Secretary Commissioner establishes and demonstrates to be
4 directly resultant from the Secretary's Commissioner's
5 responsibilities under this Act and as are directly
6 attributable to individual entities operating under this Act.
7 The aggregate of all fees collected by the Secretary
8 Commissioner on and after the effective date of this Act shall
9 be paid promptly after receipt of the same, accompanied by a
10 detailed statement thereof, into the Savings and Residential
11 Finance Regulatory Fund subject to the provisions of Section
12 7-19.1 of the Illinois Savings and Loan Act of 1985 including
13 without limitation the provision for credits against
14 regulatory fees. The amounts deposited into the Fund shall be
15 used for the ordinary and contingent expenses of the Office of
16 Banks and Real Estate. Nothing in this Act shall prevent
17 continuing the practice of paying expenses involving salaries,
18 retirement, social security, and State-paid insurance of State
19 officers by appropriation from the General Revenue Fund. For
20 the fiscal year beginning July 1, 2007, and continuing
21 thereafter through January 10, 2011, the Secretary shall adopt
22 emergency and general rules to adjust regulatory fee rates to
23 an amount that shall not exceed by more than 13.5% the rates in
24 effect prior to the escalation in rates implemented by an
25 amendment to 38 Ill. Adm. Code 1075 published in 27 Ill. Reg.
26 16043, Oct. 10, 2003. The adoption of emergency rules

 

 

SB2513 Engrossed - 43 - LRB095 18312 MJR 44396 b

1 authorized by this subsection (6) shall be deemed necessary for
2 the public interest, safety, and welfare in order to provide
3 for the expeditious and timely implementation of the State's
4 fiscal year budget through the transfer from the Savings and
5 Residential Finance Regulatory Fund to the General Revenue Fund
6 authorized by this amendatory Act of the 95th General Assembly.
7 (Source: P.A. 89-508, eff. 7-3-96.)
 
8     Section 20. The Illinois Credit Union Act is amended by
9 changing Sections 1.1 and 12 as follows:
 
10     (205 ILCS 305/1.1)  (from Ch. 17, par. 4402)
11     Sec. 1.1. Definitions.
12     Credit Union - The term "credit union" means a cooperative,
13 non-profit association, incorporated under this Act, under the
14 laws of the United States of America or under the laws of
15 another state, for the purposes of encouraging thrift among its
16 members, creating a source of credit at a reasonable rate of
17 interest, and providing an opportunity for its members to use
18 and control their own money in order to improve their economic
19 and social conditions. The membership of a credit union shall
20 consist of a group or groups each having a common bond as set
21 forth in this Act.
22     Common Bond - The term "common bond" refers to groups of
23 people who meet one of the following qualifications:
24         (1) Persons belonging to a specific association, group

 

 

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1     or organization, such as a church, labor union, club or
2     society and members of their immediate families which shall
3     include any relative by blood or marriage or foster and
4     adopted children.
5         (2) Persons who reside in a reasonably compact and well
6     defined neighborhood or community, and members of their
7     immediate families which shall include any relative by
8     blood or marriage or foster and adopted children.
9         (3) Persons who have a common employer or who are
10     members of an organized labor union or an organized
11     occupational or professional group within a defined
12     geographical area, and members of their immediate families
13     which shall include any relative by blood or marriage or
14     foster and adopted children.
15     Shares - The term "shares" or "share accounts" means any
16 form of shares issued by a credit union and established by a
17 member in accordance with standards specified by a credit
18 union, including but not limited to common shares, share draft
19 accounts, classes of shares, share certificates, special
20 purpose share accounts, shares issued in trust, custodial
21 accounts, and individual retirement accounts or other plans
22 established pursuant to Section 401(d) or (f) or Section 408(a)
23 of the Internal Revenue Code, as now or hereafter amended, or
24 similar provisions of any tax laws of the United States that
25 may hereafter exist.
26     Credit Union Organization - The term "credit union

 

 

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1 organization" means any organization established to serve the
2 needs of credit unions, the business of which relates to the
3 daily operations of credit unions.
4     Department - The term "Department" means the Illinois
5 Department of Financial Institutions.
6     Director - The term "Director" means the Director of the
7 Illinois Department of Financial Institutions, except that
8 beginning on the effective date of this amendatory Act of the
9 95th General Assembly, all references in this Act to the
10 Director of the Department of Financial Institutions are
11 deemed, in appropriate contexts, to be references to the
12 Secretary of Financial and Professional Regulation.
13     NCUA - The term "NCUA" means the National Credit Union
14 Administration, an agency of the United States Government
15 charged with the supervision of credit unions chartered under
16 the laws of the United States of America.
17     Central Credit Union - The term "central credit union"
18 means a credit union incorporated primarily to receive shares
19 from and make loans to credit unions and Directors, Officers,
20 committee members and employees of credit unions. A central
21 credit union may also accept as members persons who were
22 members of credit unions which were liquidated and persons from
23 occupational groups not otherwise served by another credit
24 union.
25     Corporate Credit Union - The term "corporate credit union"
26 means a credit union which is a cooperative, non-profit

 

 

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1 association, the membership of which is limited primarily to
2 other credit unions.
3     Insolvent - "Insolvent" means the condition that results
4 when the total of all liabilities and shares exceeds net assets
5 of the credit union.
6     Danger of insolvency - For purposes of Section 61, a credit
7 union is in "danger of insolvency" if its net worth to asset
8 ratio falls below 2%. In calculating the danger of insolvency
9 ratio, secondary capital shall be excluded. For purposes of
10 Section 61, a credit union is also in "danger of insolvency" if
11 the Department is unable to ascertain, upon examination, the
12 true financial condition of the credit union.
13     Net Worth - "Net worth" means the retained earnings balance
14 of the credit union, as determined under generally accepted
15 accounting principles, and forms of secondary capital approved
16 by the Director pursuant to rulemaking.
17     Secretary - The term "Secretary" means the Secretary of the
18 Department of Financial and Professional Regulation, or a
19 person authorized by the Secretary or this Act to act in the
20 Secretary's stead.
21 (Source: P.A. 92-608, eff. 7-1-02.)
 
22     (205 ILCS 305/12)  (from Ch. 17, par. 4413)
23     Sec. 12. Regulatory fees.
24     (1) For the fiscal year beginning July 1, 2007, a A credit
25 union regulated by the Department shall pay a regulatory fee to

 

 

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1 the Department based upon its total assets as shown by its
2 Year-end Call Report at the following rates or at a lesser rate
3 established by the Secretary in a manner proportionately
4 consistent with the following rates and sufficient to fund the
5 actual administrative and operational expenses of the Credit
6 Union Section pursuant to subsection (4) of this Section:
7TOTAL ASSETSREGULATORY FEE
8$25,000 or less ................$100
9Over $25,000 and not over
10$100,000 .......................$100 plus $4 per
11$1,000 of assets in excess of
12$25,000
13Over $100,000 and not over
14$200,000 .......................$400 plus $3 per
15$1,000 of assets in excess of
16$100,000
17Over $200,000 and not over
18$500,000 .......................$700 plus $2 per
19$1,000 of assets in excess of
20$200,000
21Over $500,000 and not over
22$1,000,000 .....................$1,300 plus $1.40
23per $1,000 of assets in excess
24of $500,000
25Over $1,000,000 and not
26over $5,000,000.................$2,000 plus $0.50

 

 

SB2513 Engrossed - 48 - LRB095 18312 MJR 44396 b

1per $1,000 of assets in
2excess of $1,000,000
3Over $5,000,000 and not
4over $30,000,000 ............... $4,540 $5,080 plus $0.397 $0.44
5per $1,000 assets
6in excess of $5,000,000
7Over $30,000,000 and not over
8$100,000,000....................$14,471 $16,192 plus $0.34
9$0.38 per $1,000 of assets
10 in excess of $30,000,000
11
12Over $100,000,000 and not
13over $500,000,000 ..............$38,306 $42,862 plus $0.17
14$0.19 per $1,000 of assets
15in excess of $100,000,000
16Over $500,000,000 ..............$106,406 $140,625 plus $0.056
17$0.075 per $1,000 of assets
18in excess of $500,000,000
19     (2) The Secretary Director shall review the regulatory fee
20 schedule in subsection (1) and the projected earnings on those
21 fees on an annual basis and adjust the fee schedule no more
22 than 5% annually if necessary to defray the estimated
23 administrative and operational expenses of the Credit Union
24 Section of the Department as defined in subsection (5).
25 However, the fee schedule shall not be increased if the amount
26 remaining in the Credit Union Fund at the end of any fiscal

 

 

SB2513 Engrossed - 49 - LRB095 18312 MJR 44396 b

1 year is greater than 25% of the total actual and operational
2 expenses incurred by the State in administering and enforcing
3 the Illinois Credit Union Act and other laws, rules, and
4 regulations as may apply to the administration and enforcement
5 of the foregoing laws, rules, and regulations as amended from
6 time to time for the preceding fiscal year. The regulatory fee
7 for the next fiscal year shall be calculated by the Secretary
8 based on the credit union's total assets as of December 31 of
9 the preceding calendar year. The Secretary Director shall
10 provide credit unions with written notice of any adjustment
11 made in the regulatory fee schedule.
12     (3) Beginning with the calendar quarter commencing on
13 January 1, 2009 Not later than March 1 of each calendar year, a
14 credit union shall pay to the Department a regulatory fee in
15 quarterly installments equal to one-fourth of the regulatory
16 fee due for that calendar year in accordance with the
17 regulatory fee schedule in subsection (1), on the basis of
18 assets as of the Year-end Call Report of the preceding calendar
19 year. The total annual regulatory fee shall not be less than
20 $100 or more than $141,875 $187,500, provided that the
21 regulatory fee cap of $141,875 $187,500 shall be adjusted to
22 incorporate the same percentage increase as the Secretary
23 Director makes in the regulatory fee schedule from time to time
24 under subsection (2). No regulatory fee shall be collected from
25 a credit union until it has been in operation for one year. The
26 regulatory fee shall be billed to credit unions on a quarterly

 

 

SB2513 Engrossed - 50 - LRB095 18312 MJR 44396 b

1 basis commencing with the quarter ending March 31, 2009, and it
2 shall be payable by credit unions on the due date for the Call
3 Report for the subject quarter.
4     (4) The aggregate of all fees collected by the Department
5 under this Act shall be paid promptly after they are received,
6 accompanied by a detailed statement thereof, into the State
7 Treasury and shall be set apart in the Credit Union Fund, a
8 special fund hereby created in the State treasury. The amount
9 from time to time deposited in the Credit Union Fund and shall
10 be used to offset the ordinary administrative and operational
11 expenses of the Credit Union Section of the Department under
12 this Act. All earnings received from investments of funds in
13 the Credit Union Fund shall be deposited into the Credit Union
14 Fund and may be used for the same purposes as fees deposited
15 into that Fund. Moneys deposited in the Credit Union Fund may
16 be transferred to the Professions Indirect Cost Fund, as
17 authorized under Section 2105-300 of the Department of
18 Professional Regulation Law of the Civil Administrative Code of
19 Illinois. Notwithstanding provisions in the State Finance Act,
20 as now or hereafter amended, or any other law to the contrary:
21 (i) the sum of $4,404,515 shall be transferred from the Credit
22 Union Fund to the General Revenue Fund as of the effective date
23 of this amendatory Act of the 95th General Assembly, or as soon
24 thereafter as practical; (ii) the Governor may, during any
25 fiscal year through January 10, 2011, from time to time direct
26 the State Treasurer and Comptroller to transfer a specified sum

 

 

SB2513 Engrossed - 51 - LRB095 18312 MJR 44396 b

1 not exceeding 10% of the revenues to be deposited into the
2 Credit Union Fund during that fiscal year from that Fund to the
3 General Revenue Fund in order to help defray the State's
4 operating costs for the fiscal year; and (iii) the total sum
5 transferred from the Credit Union Fund to the General Revenue
6 Fund pursuant to item (ii) of this subsection (4) shall not
7 exceed during any fiscal year 10% of the revenues to be
8 deposited into the Credit Union Fund during that fiscal year.
9     The State Treasurer and Comptroller shall transfer the
10 amounts designated under this Section as soon as may be
11 practicable after receiving the direction to transfer from the
12 Governor.
13     (5) The administrative and operational expenses for any
14 fiscal calendar year shall mean the ordinary and contingent
15 expenses for that year incidental to making the examinations
16 provided for by, and for administering, this Act, including all
17 salaries and other compensation paid for personal services
18 rendered for the State by officers or employees of the State to
19 enforce this Act; all expenditures for telephone and telegraph
20 charges, postage and postal charges, office supplies and
21 services, furniture and equipment, office space and
22 maintenance thereof, travel expenses and other necessary
23 expenses; all to the extent that such expenditures are directly
24 incidental to such examination or administration.
25     (6) When the balance in the Credit Union Fund at the end of
26 a fiscal year exceeds 25% aggregate of all fees collected by

 

 

SB2513 Engrossed - 52 - LRB095 18312 MJR 44396 b

1 the Department under this Act and all earnings thereon for any
2 calendar year exceeds 150% of the total administrative and
3 operational expenses incurred by the State in administering and
4 enforcing the Illinois Credit Union Act and other laws, rules,
5 and regulations as may apply to the administration and
6 enforcement of the foregoing laws, rules, and regulations as
7 amended from time to time under this Act for that fiscal year,
8 such excess shall be credited to credit unions and applied
9 against their regulatory fees for the subsequent fiscal year.
10 The amount credited to each a credit union shall be in the same
11 proportion as the regulatory fee paid by such credit union for
12 the fiscal calendar year in which the excess is produced bears
13 to the aggregate amount of all the fees collected by the
14 Department under this Act for the same fiscal year.
15     (7) (Blank). Examination fees for the year 2000 statutory
16 examinations paid pursuant to the examination fee schedule in
17 effect at that time shall be credited toward the regulatory fee
18 to be assessed the credit union in calendar year 2001.
19     (8) Nothing in this Act shall prohibit the General Assembly
20 from appropriating funds to the Department from the General
21 Revenue Fund for the purpose of administering this Act.
22     (9) For purposes of this Section, "fiscal year" means a
23 period beginning on July 1 of any calendar year and ending on
24 June 30 of the next calendar year.
25 (Source: P.A. 93-32, eff. 7-1-03; 93-652, eff. 1-8-04; 94-91,
26 eff. 7-1-05.)
 

 

 

SB2513 Engrossed - 53 - LRB095 18312 MJR 44396 b

1     Section 25. The Residential Mortgage License Act of 1987 is
2 amended by changing Sections 1-4, 2-2, 2-6, and 4-11 as
3 follows:
 
4     (205 ILCS 635/1-4)  (from Ch. 17, par. 2321-4)
5     Sec. 1-4. Definitions.
6     (a) "Residential real property" or "residential real
7 estate" shall mean real property located in this State improved
8 by a one-to-four family dwelling used or occupied, wholly or
9 partly, as the home or residence of one or more persons and may
10 refer, subject to regulations of the Commissioner, to
11 unimproved real property upon which those kinds dwellings are
12 to be constructed.
13     (b) "Making a residential mortgage loan" or "funding a
14 residential mortgage loan" shall mean for compensation or gain,
15 either directly or indirectly, advancing funds or making a
16 commitment to advance funds to a loan applicant for a
17 residential mortgage loan.
18     (c) "Soliciting, processing, placing, or negotiating a
19 residential mortgage loan" shall mean for compensation or gain,
20 either directly or indirectly, accepting or offering to accept
21 an application for a residential mortgage loan, assisting or
22 offering to assist in the processing of an application for a
23 residential mortgage loan on behalf of a borrower, or
24 negotiating or offering to negotiate the terms or conditions of

 

 

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1 a residential mortgage loan with a lender on behalf of a
2 borrower including, but not limited to, the submission of
3 credit packages for the approval of lenders, the preparation of
4 residential mortgage loan closing documents, including a
5 closing in the name of a broker.
6     (d) "Exempt person or entity" shall mean the following:
7         (1) (i) Any banking organization or foreign banking
8     corporation licensed by the Illinois Commissioner of Banks
9     and Real Estate or the United States Comptroller of the
10     Currency to transact business in this State; (ii) any
11     national bank, federally chartered savings and loan
12     association, federal savings bank, federal credit union;
13     (iii) any pension trust, bank trust, or bank trust company;
14     (iv) any bank, savings and loan association, savings bank,
15     or credit union organized under the laws of this or any
16     other state; (v) any Illinois Consumer Installment Loan Act
17     licensee; (vi) any insurance company authorized to
18     transact business in this State; (vii) any entity engaged
19     solely in commercial mortgage lending; (viii) any service
20     corporation of a savings and loan association or savings
21     bank organized under the laws of this State or the service
22     corporation of a federally chartered savings and loan
23     association or savings bank having its principal place of
24     business in this State, other than a service corporation
25     licensed or entitled to reciprocity under the Real Estate
26     License Act of 2000; or (ix) any first tier subsidiary of a

 

 

SB2513 Engrossed - 55 - LRB095 18312 MJR 44396 b

1     bank, the charter of which is issued under the Illinois
2     Banking Act by the Illinois Commissioner of Banks and Real
3     Estate, or the first tier subsidiary of a bank chartered by
4     the United States Comptroller of the Currency and that has
5     its principal place of business in this State, provided
6     that the first tier subsidiary is regularly examined by the
7     Illinois Commissioner of Banks and Real Estate or the
8     Comptroller of the Currency, or a consumer compliance
9     examination is regularly conducted by the Federal Reserve
10     Board.
11         (1.5) Any employee of a person or entity mentioned in
12     item (1) of this subsection.
13         (2) Any person or entity that does not originate
14     mortgage loans in the ordinary course of business making or
15     acquiring residential mortgage loans with his or her or its
16     own funds for his or her or its own investment without
17     intent to make, acquire, or resell more than 10 residential
18     mortgage loans in any one calendar year.
19         (3) Any person employed by a licensee to assist in the
20     performance of the activities regulated by this Act who is
21     compensated in any manner by only one licensee.
22         (4) Any person licensed pursuant to the Real Estate
23     License Act of 2000, who engages only in the taking of
24     applications and credit and appraisal information to
25     forward to a licensee or an exempt entity under this Act
26     and who is compensated by either a licensee or an exempt

 

 

SB2513 Engrossed - 56 - LRB095 18312 MJR 44396 b

1     entity under this Act, but is not compensated by either the
2     buyer (applicant) or the seller.
3         (5) Any individual, corporation, partnership, or other
4     entity that originates, services, or brokers residential
5     mortgage loans, as these activities are defined in this
6     Act, and who or which receives no compensation for those
7     activities, subject to the Commissioner's regulations with
8     regard to the nature and amount of compensation.
9         (6) A person who prepares supporting documentation for
10     a residential mortgage loan application taken by a licensee
11     and performs ministerial functions pursuant to specific
12     instructions of the licensee who neither requires nor
13     permits the preparer to exercise his or her discretion or
14     judgment; provided that this activity is engaged in
15     pursuant to a binding, written agreement between the
16     licensee and the preparer that:
17             (A) holds the licensee fully accountable for the
18         preparer's action; and
19             (B) otherwise meets the requirements of this
20         Section and this Act, does not undermine the purposes
21         of this Act, and is approved by the Commissioner.
22     (e) "Licensee" or "residential mortgage licensee" shall
23 mean a person, partnership, association, corporation, or any
24 other entity who or which is licensed pursuant to this Act to
25 engage in the activities regulated by this Act.
26     (f) "Mortgage loan" "residential mortgage loan" or "home

 

 

SB2513 Engrossed - 57 - LRB095 18312 MJR 44396 b

1 mortgage loan" shall mean a loan to or for the benefit of any
2 natural person made primarily for personal, family, or
3 household use, primarily secured by either a mortgage on
4 residential real property or certificates of stock or other
5 evidence of ownership interests in and proprietary leases from,
6 corporations, partnerships, or limited liability companies
7 formed for the purpose of cooperative ownership of residential
8 real property, all located in Illinois.
9     (g) "Lender" shall mean any person, partnership,
10 association, corporation, or any other entity who either lends
11 or invests money in residential mortgage loans.
12     (h) "Ultimate equitable owner" shall mean a person who,
13 directly or indirectly, owns or controls an ownership interest
14 in a corporation, foreign corporation, alien business
15 organization, trust, or any other form of business organization
16 regardless of whether the person owns or controls the ownership
17 interest through one or more persons or one or more proxies,
18 powers of attorney, nominees, corporations, associations,
19 partnerships, trusts, joint stock companies, or other entities
20 or devices, or any combination thereof.
21     (i) "Residential mortgage financing transaction" shall
22 mean the negotiation, acquisition, sale, or arrangement for or
23 the offer to negotiate, acquire, sell, or arrange for, a
24 residential mortgage loan or residential mortgage loan
25 commitment.
26     (j) "Personal residence address" shall mean a street

 

 

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1 address and shall not include a post office box number.
2     (k) "Residential mortgage loan commitment" shall mean a
3 contract for residential mortgage loan financing.
4     (l) "Party to a residential mortgage financing
5 transaction" shall mean a borrower, lender, or loan broker in a
6 residential mortgage financing transaction.
7     (m) "Payments" shall mean payment of all or any of the
8 following: principal, interest and escrow reserves for taxes,
9 insurance and other related reserves, and reimbursement for
10 lender advances.
11     (n) "Commissioner" shall mean the Commissioner of Banks and
12 Real Estate, except that beginning on the effective date of
13 this amendatory Act of the 95th General Assembly, all
14 references in this Act to the Commissioner of Banks and Real
15 Estate are deemed, in appropriate contexts, to be references to
16 the Secretary of Financial and Professional Regulation or a
17 person authorized by the Commissioner, the Office of Banks and
18 Real Estate Act, or this Act to act in the Commissioner's
19 stead.
20     (o) "Loan brokering", "brokering", or "brokerage service"
21 shall mean the act of helping to obtain from another entity,
22 for a borrower, a loan secured by residential real estate
23 situated in Illinois or assisting a borrower in obtaining a
24 loan secured by residential real estate situated in Illinois in
25 return for consideration to be paid by either the borrower or
26 the lender including, but not limited to, contracting for the

 

 

SB2513 Engrossed - 59 - LRB095 18312 MJR 44396 b

1 delivery of residential mortgage loans to a third party lender
2 and soliciting, processing, placing, or negotiating
3 residential mortgage loans.
4     (p) "Loan broker" or "broker" shall mean a person,
5 partnership, association, corporation, or limited liability
6 company, other than those persons, partnerships, associations,
7 corporations, or limited liability companies exempted from
8 licensing pursuant to Section 1-4, subsection (d), of this Act,
9 who performs the activities described in subsections (c) and
10 (o) of this Section.
11     (q) "Servicing" shall mean the collection or remittance for
12 or the right or obligation to collect or remit for any lender,
13 noteowner, noteholder, or for a licensee's own account, of
14 payments, interests, principal, and trust items such as hazard
15 insurance and taxes on a residential mortgage loan in
16 accordance with the terms of the residential mortgage loan; and
17 includes loan payment follow-up, delinquency loan follow-up,
18 loan analysis and any notifications to the borrower that are
19 necessary to enable the borrower to keep the loan current and
20 in good standing.
21     (r) "Full service office" shall mean office and staff in
22 Illinois reasonably adequate to handle efficiently
23 communications, questions, and other matters relating to any
24 application for, or an existing home mortgage secured by
25 residential real estate situated in Illinois with respect to
26 which the licensee is brokering, funding originating,

 

 

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1 purchasing, or servicing. The management and operation of each
2 full service office must include observance of good business
3 practices such as adequate, organized, and accurate books and
4 records; ample phone lines, hours of business, staff training
5 and supervision, and provision for a mechanism to resolve
6 consumer inquiries, complaints, and problems. The Commissioner
7 shall issue regulations with regard to these requirements and
8 shall include an evaluation of compliance with this Section in
9 his or her periodic examination of each licensee.
10     (s) "Purchasing" shall mean the purchase of conventional or
11 government-insured mortgage loans secured by residential real
12 estate situated in Illinois from either the lender or from the
13 secondary market.
14     (t) "Borrower" shall mean the person or persons who seek
15 the services of a loan broker, originator, or lender.
16     (u) "Originating" shall mean the issuing of commitments for
17 and funding of residential mortgage loans.
18     (v) "Loan brokerage agreement" shall mean a written
19 agreement in which a broker or loan broker agrees to do either
20 of the following:
21         (1) obtain a residential mortgage loan for the borrower
22     or assist the borrower in obtaining a residential mortgage
23     loan; or
24         (2) consider making a residential mortgage loan to the
25     borrower.
26     (w) "Advertisement" shall mean the attempt by publication,

 

 

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1 dissemination, or circulation to induce, directly or
2 indirectly, any person to enter into a residential mortgage
3 loan agreement or residential mortgage loan brokerage
4 agreement relative to a mortgage secured by residential real
5 estate situated in Illinois.
6     (x) "Residential Mortgage Board" shall mean the
7 Residential Mortgage Board created in Section 1-5 of this Act.
8     (y) "Government-insured mortgage loan" shall mean any
9 mortgage loan made on the security of residential real estate
10 insured by the Department of Housing and Urban Development or
11 Farmers Home Loan Administration, or guaranteed by the Veterans
12 Administration.
13     (z) "Annual audit" shall mean a certified audit of the
14 licensee's books and records and systems of internal control
15 performed by a certified public accountant in accordance with
16 generally accepted accounting principles and generally
17 accepted auditing standards.
18     (aa) "Financial institution" shall mean a savings and loan
19 association, savings bank, credit union, or a bank organized
20 under the laws of Illinois or a savings and loan association,
21 savings bank, credit union or a bank organized under the laws
22 of the United States and headquartered in Illinois.
23     (bb) "Escrow agent" shall mean a third party, individual or
24 entity charged with the fiduciary obligation for holding escrow
25 funds on a residential mortgage loan pending final payout of
26 those funds in accordance with the terms of the residential

 

 

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1 mortgage loan.
2     (cc) "Net worth" shall have the meaning ascribed thereto in
3 Section 3-5 of this Act.
4     (dd) "Affiliate" shall mean:
5         (1) any entity that directly controls or is controlled
6     by the licensee and any other company that is directly
7     affecting activities regulated by this Act that is
8     controlled by the company that controls the licensee;
9         (2) any entity:
10             (A) that is controlled, directly or indirectly, by
11         a trust or otherwise, by or for the benefit of
12         shareholders who beneficially or otherwise control,
13         directly or indirectly, by trust or otherwise, the
14         licensee or any company that controls the licensee; or
15             (B) a majority of the directors or trustees of
16         which constitute a majority of the persons holding any
17         such office with the licensee or any company that
18         controls the licensee;
19         (3) any company, including a real estate investment
20     trust, that is sponsored and advised on a contractual basis
21     by the licensee or any subsidiary or affiliate of the
22     licensee.
23     The Commissioner may define by rule and regulation any
24 terms used in this Act for the efficient and clear
25 administration of this Act.
26     (ee) "First tier subsidiary" shall be defined by regulation

 

 

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1 incorporating the comparable definitions used by the Office of
2 the Comptroller of the Currency and the Illinois Commissioner
3 of Banks and Real Estate.
4     (ff) "Gross delinquency rate" means the quotient
5 determined by dividing (1) the sum of (i) the number of
6 government-insured residential mortgage loans funded or
7 purchased by a licensee in the preceding calendar year that are
8 delinquent and (ii) the number of conventional residential
9 mortgage loans funded or purchased by the licensee in the
10 preceding calendar year that are delinquent by (2) the sum of
11 (i) the number of government-insured residential mortgage
12 loans funded or purchased by the licensee in the preceding
13 calendar year and (ii) the number of conventional residential
14 mortgage loans funded or purchased by the licensee in the
15 preceding calendar year.
16     (gg) "Delinquency rate factor" means the factor set by rule
17 of the Commissioner that is multiplied by the average gross
18 delinquency rate of licensees, determined annually for the
19 immediately preceding calendar year, for the purpose of
20 determining which licensees shall be examined by the
21 Commissioner pursuant to subsection (b) of Section 4-8 of this
22 Act.
23     (hh) "Loan originator" means any natural person who, for
24 compensation or in the expectation of compensation, either
25 directly or indirectly makes, offers to make, solicits, places,
26 or negotiates a residential mortgage loan.

 

 

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1     (ii) "Confidential supervisory information" means any
2 report of examination, visitation, or investigation prepared
3 by the Commissioner under this Act, any report of examination
4 visitation, or investigation prepared by the state regulatory
5 authority of another state that examines a licensee, any
6 document or record prepared or obtained in connection with or
7 relating to any examination, visitation, or investigation, and
8 any record prepared or obtained by the Commissioner to the
9 extent that the record summarizes or contains information
10 derived from any report, document, or record described in this
11 subsection. "Confidential supervisory information" does not
12 include any information or record routinely prepared by a
13 licensee and maintained in the ordinary course of business or
14 any information or record that is required to be made publicly
15 available pursuant to State or federal law or rule.
16     (jj) "Secretary" means the Secretary of the Department of
17 Financial and Professional Regulation, or a person authorized
18 by the Secretary or by this Act to act in the Secretary's
19 stead.
20 (Source: P.A. 93-561, eff. 1-1-04; 93-1018, eff. 1-1-05.)
 
21     (205 ILCS 635/2-2)  (from Ch. 17, par. 2322-2)
22     Sec. 2-2. Application process; investigation; fee.
23     (a) The Secretary Commissioner shall issue a license upon
24 completion of all of the following:
25         (1) The filing of an application for license.

 

 

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1         (2) The filing with the Secretary Commissioner of a
2     listing of judgments entered against, and bankruptcy
3     petitions by, the license applicant for the preceding 10
4     years.
5         (3) The payment, in certified funds, of investigation
6     and application fees, the total of which shall be in an
7     amount equal to $2,043 $2,700 annually, however, the
8     Commissioner may increase the investigation and
9     application fees by rule as provided in Section 4-11.
10         (4) Except for a broker applying to renew a license,
11     the filing of an audited balance sheet including all
12     footnotes prepared by a certified public accountant in
13     accordance with generally accepted accounting principles
14     and generally accepted auditing principles which evidences
15     that the applicant meets the net worth requirements of
16     Section 3-5.
17         (5) The filing of proof satisfactory to the
18     Commissioner that the applicant, the members thereof if the
19     applicant is a partnership or association, the members or
20     managers thereof that retain any authority or
21     responsibility under the operating agreement if the
22     applicant is a limited liability company, or the officers
23     thereof if the applicant is a corporation have 3 years
24     experience preceding application in real estate finance.
25     Instead of this requirement, the applicant and the
26     applicant's officers or members, as applicable, may

 

 

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1     satisfactorily complete a program of education in real
2     estate finance and fair lending, as approved by the
3     Commissioner, prior to receiving the initial license. The
4     Commissioner shall promulgate rules regarding proof of
5     experience requirements and educational requirements and
6     the satisfactory completion of those requirements. The
7     Commissioner may establish by rule a list of duly licensed
8     professionals and others who may be exempt from this
9     requirement.
10         (6) An investigation of the averments required by
11     Section 2-4, which investigation must allow the
12     Commissioner to issue positive findings stating that the
13     financial responsibility, experience, character, and
14     general fitness of the license applicant and of the members
15     thereof if the license applicant is a partnership or
16     association, of the officers and directors thereof if the
17     license applicant is a corporation, and of the managers and
18     members that retain any authority or responsibility under
19     the operating agreement if the license applicant is a
20     limited liability company are such as to command the
21     confidence of the community and to warrant belief that the
22     business will be operated honestly, fairly and efficiently
23     within the purpose of this Act. If the Commissioner shall
24     not so find, he or she shall not issue such license, and he
25     or she shall notify the license applicant of the denial.
26     The Commissioner may impose conditions on a license if the

 

 

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1 Commissioner determines that the conditions are necessary or
2 appropriate. These conditions shall be imposed in writing and
3 shall continue in effect for the period prescribed by the
4 Commissioner.
5     (b) All licenses shall be issued in duplicate with one copy
6 being transmitted to the license applicant and the second being
7 retained with the Commissioner.
8     Upon receipt of such license, a residential mortgage
9 licensee shall be authorized to engage in the business
10 regulated by this Act. Such license shall remain in full force
11 and effect until it expires without renewal, is surrendered by
12 the licensee or revoked or suspended as hereinafter provided.
13 (Source: P.A. 93-32, eff. 7-1-03; 93-1018, eff. 1-1-05.)
 
14     (205 ILCS 635/2-6)  (from Ch. 17, par. 2322-6)
15     Sec. 2-6. License issuance and renewal; fee.
16     (a) Beginning July 1, 2003, licenses shall be renewed every
17 year on the anniversary of the date of issuance of the original
18 license. Properly completed renewal application forms and
19 filing fees must be received by the Secretary Commissioner 60
20 days prior to the renewal date.
21     (b) It shall be the responsibility of each licensee to
22 accomplish renewal of its license; failure of the licensee to
23 receive renewal forms absent a request sent by certified mail
24 for such forms will not waive said responsibility. Failure by a
25 licensee to submit a properly completed renewal application

 

 

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1 form and fees in a timely fashion, absent a written extension
2 from the Secretary Commissioner, will result in the assessment
3 of additional fees, as follows:
4         (1) A fee of $567.50 $750 will be assessed to the
5     licensee 30 days after the proper renewal date and $1,135
6     $1,500 each month thereafter, until the license is either
7     renewed or expires pursuant to Section 2-6, subsections (c)
8     and (d), of this Act.
9         (2) Such fee will be assessed without prior notice to
10     the licensee, but will be assessed only in cases wherein
11     the Secretary Commissioner has in his or her possession
12     documentation of the licensee's continuing activity for
13     which the unrenewed license was issued.
14     (c) A license which is not renewed by the date required in
15 this Section shall automatically become inactive. No activity
16 regulated by this Act shall be conducted by the licensee when a
17 license becomes inactive. The Commissioner may require the
18 licensee to provide a plan for the disposition of any
19 residential mortgage loans not closed or funded when the
20 license becomes inactive. The Commissioner may allow a licensee
21 with an inactive license to conduct activities regulated by
22 this Act for the sole purpose of assisting borrowers in the
23 closing or funding of loans for which the loan application was
24 taken from a borrower while the license was active. An inactive
25 license may be reactivated by the Commissioner upon payment of
26 the renewal fee, and payment of a reactivation fee equal to the

 

 

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1 renewal fee.
2     (d) A license which is not renewed within one year of
3 becoming inactive shall expire.
4     (e) A licensee ceasing an activity or activities regulated
5 by this Act and desiring to no longer be licensed shall so
6 inform the Commissioner in writing and, at the same time,
7 convey the license and all other symbols or indicia of
8 licensure. The licensee shall include a plan for the withdrawal
9 from regulated business, including a timetable for the
10 disposition of the business. Upon receipt of such written
11 notice, the Commissioner shall issue a certified statement
12 canceling the license.
13 (Source: P.A. 93-32, eff. 7-1-03; 93-561, eff. 1-1-04; 93-1018,
14 eff. 1-1-05.)
 
15     (205 ILCS 635/4-11)  (from Ch. 17, par. 2324-11)
16     Sec. 4-11. Costs of Supervision; Examination and
17 Investigative Fees. The expenses of administering this Act,
18 including investigations and examinations provided for in this
19 Act shall be borne by and assessed against entities regulated
20 by this Act. Subject to the limitations set forth in Section
21 2-2 of this Act, the Secretary The Commissioner shall establish
22 fees by regulation in at least the following categories:
23     (1) application fees;
24     (2) investigation of license applicant fees;
25     (3) examination fees;

 

 

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1     (4) contingent fees;
2 and such other categories as may be required to administer this
3 Act.
4 (Source: P.A. 85-735.)
 
5     Section 99. Effective date. This Act takes effect upon
6 becoming law.