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90_HB3137
205 ILCS 5/21 from Ch. 17, par. 328
205 ILCS 5/25 from Ch. 17, par. 332
205 ILCS 5/26 from Ch. 17, par. 333
205 ILCS 5/27 from Ch. 17, par. 334
205 ILCS 5/28 from Ch. 17, par. 335
205 ILCS 305/17 from Ch. 17, par. 4418
Amends the Illinois Banking Act and the Illinois Credit
Union Act. Authorizes the conversion of credit unions into
State banks. Effective immediately.
LRB9009786JSmg
LRB9009786JSmg
1 AN ACT concerning conversion of credit unions into State
2 banks, amending named Acts.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Illinois Banking Act is amended by
6 changing Sections 21, 25, 26, 27, and 28 as follows:
7 (205 ILCS 5/21) (from Ch. 17, par. 328)
8 Sec. 21. Resulting State bank.
9 (a) Upon approval by the Commissioner, banks may be
10 merged to result in a State bank, and a national bank, or
11 insured savings association, or credit union may convert into
12 a State bank as prescribed by this Act, except that the
13 action by a national bank, or an insured savings association,
14 or a credit union shall be taken in the manner prescribed by
15 and shall be subject to limitations and requirements imposed
16 by the law of the United States or the laws of the State of
17 Illinois, which shall also govern the rights of its
18 dissenting stockholders.
19 (b) Upon approval by the Commissioner, a State bank may
20 be merged with an insured savings association resulting in a
21 State bank except that the merger of an insured savings
22 association shall be in the manner prescribed by and shall be
23 subject to limitations and requirements imposed by the laws
24 of the State of Illinois, including this Act, and the laws of
25 the United States.
26 (c) On or after June 1, 1997, a State bank, the deposits
27 of which are insured by the Federal Deposit Insurance
28 Corporation, may merge with an out-of-state bank. When the
29 resulting bank will be a State bank, the merger shall be
30 subject to the provisions and requirements of this Act. When
31 the resulting bank will be an out-of-state bank, the merger
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1 shall be in the manner prescribed by and shall be subject to
2 the limitations and requirements imposed by the laws of the
3 other State, except that if the laws of the other state do
4 not provide rights for dissenting shareholders that are
5 comparable to those provided by Section 29 of this Act, then
6 the rights of the dissenting stockholders of the State bank
7 shall be governed by Section 29 of this Act.
8 (Source: P.A. 89-208, eff. 9-29-95; 89-567, eff. 7-26-96.)
9 (205 ILCS 5/25) (from Ch. 17, par. 332)
10 Sec. 25. Conversion of national bank, or insured savings
11 association, or credit union into State bank. A national
12 bank, or insured savings association, or credit union located
13 in this State which follows the procedure prescribed by the
14 laws of the United States or of the State of Illinois to
15 convert into a State bank may be granted a charter by the
16 Commissioner. The national bank, or insured savings
17 association, or credit union may apply for such charter by
18 filing with the Commissioner:
19 (1) A certificate signed by its president, or a
20 vice-president, or the cashier, and by a majority of the
21 entire board of directors setting forth the corporate action
22 taken in compliance with the provisions of the laws of the
23 United States or of the State of Illinois governing the
24 conversion of a national bank, or insured savings
25 association, or credit union to a State bank;
26 (2) The plan of conversion and the proposed charter
27 approved by the stockholders or membership for the operation
28 of the bank, or insured savings association, or credit union
29 as a State bank;
30 (3) The name proposed for the converting bank, or
31 insured savings association, or credit union, its location,
32 and a list of its stockholders or membership as of the date
33 of the stockholders' or membership's approval of the plan of
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1 conversion;
2 (4) The amount of its capital, surplus and reserve for
3 operation expenses, the classes and the number of the shares
4 of stock or membership shares and the par value of each
5 share, and a detailed statement showing the assets and
6 liabilities of the converting bank, or insured savings
7 association, or credit union; and
8 (5) A statement that the plan of conversion is subject
9 to the approval of the Commissioner and that whether approved
10 or disapproved the converting bank, or insured savings
11 association, or credit union will pay the Commissioner's
12 expenses of examination.
13 For purposes of this Section, a national bank, or insured
14 savings association, or credit union is located in the State
15 where its main banking premises or main office is located.
16 (Source: P.A. 89-567, eff. 7-26-96.)
17 (205 ILCS 5/26) (from Ch. 17, par. 333)
18 Sec. 26. Converting national banks, or insured savings
19 association, or credit union; issuance of charter to
20 resulting State bank. After receipt by the Commissioner of
21 the papers specified in Section 25, he shall approve or
22 disapprove the plan of conversion. The Commissioner shall not
23 approve the plan of conversion unless he shall be of the
24 opinion and finds:
25 (a) That the resulting bank meets the requirements of
26 this Act for the formation of a new bank at the proposed
27 place of business of the resulting bank;
28 (b) That the same matters exist in respect of the
29 resulting bank which would have been required under Section
30 10 of this Act for the organization of a new bank; and
31 (c) That the plan of conversion is fair to all persons
32 affected.
33 If the Commissioner disapproves the plan of conversion,
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1 he shall state his objections in writing and give an
2 opportunity to the converting bank, or insured savings
3 association, or credit union to amend the plan of conversion
4 to obviate such objections. The conversion, unless a later
5 date is specified in the plan of conversion, shall become
6 effective upon the Commissioner's approval and the charter
7 proposed in the plan of conversion shall constitute the
8 charter. The Commissioner shall issue a certificate of
9 conversion which shall specify the name of the converting
10 bank, or insured savings association, or credit union, the
11 name of the resulting bank, and the charter provided for by
12 said plan of conversion. Such certificate shall be conclusive
13 evidence of the conversion and of the correctness of all
14 proceedings therefor in all courts and places, and such
15 certificate shall be recorded.
16 (Source: P.A. 89-567, eff. 7-26-96.)
17 (205 ILCS 5/27) (from Ch. 17, par. 334)
18 Sec. 27. Commissioner's expenses. The expenses of any
19 examination made by the Commissioner or at his direction in
20 connection with a proposed merger or a proposed conversion
21 shall be paid by the merging banks or insured savings
22 association or by the converting bank, or insured savings
23 association, or credit union. In any merger under the
24 provisions of Section 31 of this Act, the continuing or
25 resulting bank, or if the proposed merger is not consummated,
26 the bank that would have been the continuing or resulting
27 bank shall pay the expenses of any examination made by the
28 Commissioner or at his direction in connection with the
29 merger.
30 (Source: P.A. 89-567, eff. 7-26-96.)
31 (205 ILCS 5/28) (from Ch. 17, par. 335)
32 Sec. 28. Continuation of corporate entity. A resulting
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1 State bank, national bank or, after May 31, 1997,
2 out-of-state bank shall be considered the same business and
3 corporate entity as each merging bank or insured savings
4 association or as the converting bank, or insured savings
5 association, or credit union with all the property, rights,
6 powers, duties, and obligations of each merging bank or
7 insured savings association or of the converting bank, or
8 insured savings association, or credit union except as
9 affected by the State law in the case of a resulting State
10 bank or out-of-state bank or by the national law in the case
11 of a resulting national bank, and by the charter and by-laws
12 of the resulting bank. A resulting bank shall be liable for
13 all liabilities of the merging banks or, insured savings
14 association, or of the converting bank, or insured savings
15 association, or credit union, and all the rights, franchises
16 and interests of the merging banks or, insured savings
17 association, or of the converting bank, or insured savings
18 association, or credit union in and to every species of
19 property, real, personal, and mixed, and chooses in action
20 thereunto belonging, shall be deemed to be transferred to and
21 vested in the resulting bank without any deed or other
22 transfer, and the resulting bank, without any order or other
23 action on the part of any court or otherwise, shall hold and
24 enjoy the same and all rights of property, franchises, and
25 interests, including appointments, designations, and
26 nominations and all other rights and interests as trustee,
27 executor, administrator, registrar or transfer agent of
28 stocks and bonds, guardian, assignee, receiver, and in every
29 other fiduciary capacity, in the same manner and to the same
30 extent as was held and enjoyed by the merging banks or,
31 insured savings association, or by the converting bank, or
32 insured savings association, or credit union. Any reference
33 to a merging or converting bank or a merging or converting
34 insured savings association or a converting credit union in
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1 any writing, whether executed or taking effect before or
2 after the merger or conversion, shall be deemed a reference
3 to the resulting bank if not inconsistent with the other
4 provisions of the writing.
5 (Source: P.A. 89-208, eff. 9-29-95; 89-567, eff. 7-26-96.)
6 Section 10. The Illinois Credit Union Act is amended by
7 changing Section 17 as follows:
8 (205 ILCS 305/17) (from Ch. 17, par. 4418)
9 Sec. 17. Members who leave field. Nothing in this Act
10 shall be construed to impair the charter of an existing
11 credit union, prevent the merger of credit unions as
12 otherwise provided for in this Act, prevent the conversion
13 of a credit union charter as otherwise provided by law, or
14 prevent a credit union from retaining as a member a person
15 who subsequent to becoming a member, leaves the credit
16 union's common bond or undergoes a change in marital status.
17 (Source: P.A. 81-329.)
18 Section 99. Effective date. This Act takes effect upon
19 becoming law.