Illinois Compiled Statutes
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205 ILCS 205/6013
(205 ILCS 205/6013)
(from Ch. 17, par. 7306-13)
Loans to one borrower.
(a) Except as provided in subsection (c), the total loans and extensions
of credit, both direct and
indirect, by a savings bank to any person, other than a municipal
corporation for money borrowed, outstanding at one time shall not
exceed 25% of the savings bank's total capital plus general loan
(b) Except as provided in subsection (c), the total loans and extensions
of credit, both direct and
indirect, by a savings bank to any person outstanding at one time
and at least 100% secured by readily marketable collateral having
a market value, as determined by reliable and continuously
available price quotations, shall not exceed 10% of the savings
bank's total capital plus general loan loss reserves. This limitation
shall be separate from and
in addition to the limitation contained in subsection (a).
(c) If the limit under subsection (a) or (b) on total loans to one
borrower is less than $500,000, a savings bank that meets its minimum capital
requirement under this Act may have loan and extensions of credit, both direct
and indirect, outstanding to any person at one time not to exceed $500,000.
the prior written approval of the Commissioner, a savings bank that has capital
in excess of 6% of assets may make loans and extensions of credit to one
borrower for the development of residential housing properties, located or to
be located in this State, not to exceed 30% of the savings bank's total capital
plus general loan loss reserves.
(d) For purposes of this Section, the term "person" shall be
deemed to include an individual, firm, corporation, business trust,
partnership, trust, estate, association, joint venture, pool,
syndicate, sole proprietorship, unincorporated association, any
political subdivision, or any similar entity or organization.
(e) For the purposes of this Section any loan or extension
of credit granted to one person, the proceeds of which are used for
the direct benefit of a second person, shall be deemed a loan or
extension of credit to the second person as well as the first
person. In addition, a loan or extension of credit to one person
shall be deemed a loan or extension of credit to others when a common
enterprise exists between the first person and such other persons.
(f) For the purposes of this Section, the total liabilities
of a firm, partnership, pool, syndicate, or joint venture shall include the
liabilities of the members of the entity.
(g) For the purposes of this Section, the term "readily
marketable collateral" means financial instruments or bullion
that are salable under ordinary circumstances with reasonable
promptness at a fair market value on an auction or a similarly
available daily bid-and-ask price market. "Financial instruments"
include stocks, bonds, notes, debentures traded on a national
exchange or over the counter, commercial paper, negotiable
certificates of deposit, bankers' acceptances, and shares in money
market or mutual funds.
(h) Each savings bank shall institute adequate procedures to
ensure that collateral fully secures the outstanding loan or
extension of credit at all times.
(i) If collateral values fall below 100% of the outstanding
loan or extension of credit to the extent that the loan or
extension of credit no longer is in conformance with subsection (b)
and exceeds the 25% limitation of subsection (a), the
loan must be brought into conformance with this Section within 5
business days except where judicial proceedings or other similar
extraordinary occurrences prevent the savings bank from taking
(j) This Section shall not apply to loans or extensions of
credit to the United States of America or its agencies or this
State or its agencies or to any loan, investment, or extension of credit made
pursuant to Section 6003 of this Act.
(k) This Section does not apply to the obligations as endorser, whether
with or without recourse, or as guarantor, whether conditional or
unconditional, of negotiable or nonnegotiable installment consumer paper of the
person transferring the same if the bank's files or the knowledge of its
officers of the financial condition of each maker of those obligations is
reasonably adequate and if an officer of the bank, designated for that purpose
by the board of directors of the bank, certifies that the responsibility of
each maker of the obligations has been evaluated and that the bank is relying
primarily upon each maker for the payment of the obligations. The
shall be in writing and shall be retained as part of the records of the bank.
(l) The Commissioner may prescribe rules to carry out the purposes of this
Section and to establish limits or requirements other than those specified in
this Section for particular types of loans and extensions of credit.
(Source: P.A. 92-483, eff. 8-23-01; 92-700, eff. 7-19-02.)