State of Illinois
92^nd General Assembly
Legislation

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92_HB2538eng

 
HB2538 Engrossed                               LRB9201093JScs

 1        AN ACT concerning certain financial institutions.

 2        Be it  enacted  by  the  People  of  the  State  of  Illinois,
 3    represented in the General Assembly:

 4        Section  5.  The  Office  of Banks and Real Estate Act is
 5    amended by changing Sections 5 and 6 as follows:

 6        (20 ILCS 3205/5) (from Ch. 17, par. 455)
 7        Sec. 5.  Powers.  In addition to all the other powers and
 8    duties provided by  law,  the  Commissioner  shall  have  the
 9    following powers:
10        (a)  To  exercise  the rights, powers and duties formerly
11    vested by law in the Director of Financial Institutions under
12    the Illinois Banking Act.
13        (b)  To exercise the rights, powers and  duties  formerly
14    vested  by  law  in  the Department of Financial Institutions
15    under "An act to provide for and regulate the  administration
16    of  trusts  by  trust  companies", approved June 15, 1887, as
17    amended.
18        (c)  To exercise the rights, powers and  duties  formerly
19    vested by law in the Director of Financial Institutions under
20    "An act authorizing foreign corporations, including banks and
21    national  banking  associations domiciled in other states, to
22    act in a  fiduciary  capacity  in  this  state  upon  certain
23    conditions  herein  set  forth",  approved  July 13, 1953, as
24    amended.
25        (d)  Whenever the Commissioner is authorized or  required
26    by  law  to  consider  or  to  make  findings  regarding  the
27    character  of incorporators, directors, management personnel,
28    or other relevant individuals under the Illinois Banking Act,
29    the Corporate Fiduciary Act, the Pawnbroker  Regulation  Act,
30    or at other times as the Commissioner deems necessary for the
31    purpose  of  carrying out the Commissioner's statutory powers
 
HB2538 Engrossed            -2-                LRB9201093JScs
 1    and  responsibilities,  the   Commissioner   shall   consider
 2    criminal  history record information, including nonconviction
 3    information, pursuant to  the  Criminal  Identification  Act.
 4    The  Commissioner  shall,  in the form and manner required by
 5    the Department of State Police  and  the  Federal  Bureau  of
 6    Investigation,  cause  to  be  conducted  a  criminal history
 7    record  investigation   to   obtain   information   currently
 8    contained  in  the files of the Department of State Police or
 9    the  Federal  Bureau  of  Investigation,  provided  that  the
10    Commissioner  need  not  cause  additional  criminal  history
11    record investigations to be conducted on individuals for whom
12    the Commissioner, a federal bank regulatory  agency,  or  any
13    other  government  agency  has  caused such investigations to
14    have  been  conducted  previously  unless   such   additional
15    investigations  are  otherwise  required by law or unless the
16    Commissioner  deems  such  additional  investigations  to  be
17    necessary for the purposes of carrying out the Commissioner's
18    statutory powers and responsibilities.    The  Department  of
19    State  Police  shall  provide, on the Commissioner's request,
20    information concerning criminal charges and their disposition
21    currently on file with  respect  to  a  relevant  individual.
22    Information  obtained  as  a result of an investigation under
23    this Section shall be used in determining eligibility  to  be
24    an  incorporator,  director,  management  personnel, or other
25    relevant individual in relation to a financial institution or
26    other entity supervised by the  Commissioner.   Upon  request
27    and  payment  of fees in conformance with the requirements of
28    Section 2605-400 of the Department of State  Police  Law  (20
29    ILCS  2605/2605-400),  the  Department  of  State  Police  is
30    authorized  to  furnish, pursuant to positive identification,
31    such information contained in State files as is necessary  to
32    fulfill the request.
33        (e)  When  issuing  charters, permits, licenses, or other
34    authorizations, the Commissioner may impose  such  terms  and
 
HB2538 Engrossed            -3-                LRB9201093JScs
 1    conditions   on   the  issuance  as  he  deems  necessary  or
 2    appropriate.  Failure to abide by those terms and  conditions
 3    may result in the  revocation of the issuance, the imposition
 4    of  corrective  orders,  or  the  imposition  of  civil money
 5    penalties.
 6        (f)  If the Commissioner has reasonable cause to  believe
 7    that  any  entity  that  has not submitted an application for
 8    authorization or licensure is conducting  any  activity  that
 9    would  otherwise  require  authorization  or licensure by the
10    Commissioner,  the  Commissioner  shall  have  the  power  to
11    subpoena  witnesses,  to  compel  their  attendance,  and  to
12    require  the  production  of  any  relevant  books,   papers,
13    accounts,  and  documents  in  order to determine whether the
14    entity is  subject  to  authorization  or  licensure  by  the
15    Commissioner or the Office of Banks and Real Estate.
16        (g)  The  Commissioner may, through the Attorney General,
17    request  the  circuit  court  of  any  county  to  issue   an
18    injunction   to   restrain  any  person  from  violating  the
19    provisions of any Act administered by the Commissioner.
20        (h)  Whenever the Commissioner is authorized to take  any
21    action  or  required by law to consider or make findings, the
22    Commissioner may delegate or appoint, in writing, an  officer
23    or  employee  of  the Office of Banks and Real Estate to take
24    that action or make that finding.
25    (Source: P.A.  90-301,  eff.  8-1-97;  90-602,  eff.  7-1-98;
26    91-239, eff. 1-1-00.)

27        (20 ILCS 3205/6) (from Ch. 17, par. 456)
28        Sec.  6.  Duties.   The  Commissioner  shall  direct  and
29    supervise  all the administrative and technical activities of
30    the Office and shall:
31        (a)  Apply and carry out this Act and  the  law  and  all
32    rules adopted in pursuance thereof.
33        (b)  Appoint,  subject to the provisions of the Personnel
 
HB2538 Engrossed            -4-                LRB9201093JScs
 1    Code, such employees, experts, and special assistants as  may
 2    be  necessary to carry out effectively the provisions of this
 3    Act and, if the rate of compensation is not  otherwise  fixed
 4    by  law, fix their compensation; but neither the Commissioner
 5    nor any deputy commissioner shall be subject to the Personnel
 6    Code.
 7        (c)  Serve as Chairman of  the  State  Banking  Board  of
 8    Illinois.
 9        (d)  Serve  as  Chairman  of the Board of Trustees of the
10    Illinois Bank Examiners' Education Foundation.
11        (e)  Issue guidelines in the form of rules or regulations
12    which will prohibit discrimination  by  any  State  chartered
13    bank   against   any  individual,  corporation,  partnership,
14    association or other entity because it appears in a so-called
15    blacklist issued by any  domestic  or  foreign  corporate  or
16    governmental entity.
17        (f)  Make  an annual report to the Governor regarding the
18    work of the Office as the Commissioner may consider desirable
19    or as the Governor may request.
20        (g)  Perform such other acts as may be requested  by  the
21    State Banking Board of Illinois pursuant to its lawful powers
22    and  perform  any  other  lawful  act  that  the Commissioner
23    considers to be necessary  or  desirable  to  carry  out  the
24    purposes and provisions of this Act.
25        (h)  Adopt,    in    accordance    with    the   Illinois
26    Administrative  Procedure  Act,  reasonable  rules  that  the
27    Commissioner deems necessary for  the  proper  administration
28    and  enforcement  of  any  Act the administration of which is
29    vested in the Commissioner or the Office of  Banks  and  Real
30    Estate.
31    (Source: P.A. 89-508, eff. 7-3-96.)

32        Section  10.  The  Illinois  Banking  Act  is  amended by
33    changing Sections 2, 5, 5b, 7, 8, 10, 12, 13, 13.5,  14,  15,
 
HB2538 Engrossed            -5-                LRB9201093JScs
 1    16.1,  17,  18, 22, 25, 30.5, 31, 33, 37, 47, 48, 48.1, 48.5,
 2    49, 51, and 53, and adding Section 48.7 as follows:

 3        (205 ILCS 5/2) (from Ch. 17, par. 302)
 4        Sec. 2.  General definitions.  In this  Act,  unless  the
 5    context  otherwise  requires, the following words and phrases
 6    shall have the following meanings:
 7        "Accommodation party" shall have the meaning ascribed  to
 8    that term in Section 3-419 of the Uniform Commercial Code.
 9        "Action"  in  the sense of a judicial proceeding includes
10    recoupments, counterclaims, set-off, and any other proceeding
11    in which rights are determined.
12        "Affiliate facility" of  a  bank  means  a  main  banking
13    premises  or  branch of another commonly owned bank. The main
14    banking premises or any branch of a bank may be an "affiliate
15    facility" with respect to one or more  other  commonly  owned
16    banks.
17        "Appropriate  federal  banking  agency" means the Federal
18    Deposit Insurance Corporation, the Federal  Reserve  Bank  of
19    Chicago,  or  the  Federal  Reserve  Bank  of  St.  Louis, as
20    determined by federal law.
21        "Bank" means any person doing a banking business  whether
22    subject to the laws of this or any other jurisdiction.
23        A  "banking  house",  "branch",  "branch bank" or "branch
24    office" shall mean any place of business of a bank  at  which
25    deposits  are received, checks paid, or loans made, but shall
26    not include any place at which only records thereof are made,
27    posted, or kept.  A place of business at which  deposits  are
28    received,  checks  paid, or loans made shall not be deemed to
29    be a branch, branch bank, or branch office if  the  place  of
30    business  is  adjacent to and connected with the main banking
31    premises, or  if  it  is  separated  from  the  main  banking
32    premises  by not more than an alley; provided always that (i)
33    if the place of business is separated by an  alley  from  the
 
HB2538 Engrossed            -6-                LRB9201093JScs
 1    main  banking  premises there is a connection between the two
 2    by public or private  way  or  by  subterranean  or  overhead
 3    passage,  and  (ii) if the place of business is in a building
 4    not wholly occupied by the bank, the place of business  shall
 5    not  be within any office or room in which any other business
 6    or service of any kind or nature other than the  business  of
 7    the  bank  is conducted or carried on. A place of business at
 8    which deposits are received, checks paid, or loans made shall
 9    not be deemed to be a branch, branch bank, or  branch  office
10    (i)  of  any  bank if the place is a terminal established and
11    maintained in accordance with paragraph (17) of Section 5  of
12    this  Act,  or  (ii)  of  a  commonly owned bank by virtue of
13    transactions conducted at that place on behalf of  the  other
14    commonly owned bank under paragraph (23) of Section 5 of this
15    Act if the place is an affiliate facility with respect to the
16    other bank.
17        "Branch   of   an   out-of-state  bank"  means  a  branch
18    established or maintained in Illinois by an out-of-state bank
19    as a result of a merger between  an  Illinois  bank  and  the
20    out-of-state  bank  that  occurs on or after May 31, 1997, or
21    any branch established by the out-of-state bank following the
22    merger.
23        "Call report fee"  means  the  fee  to  be  paid  to  the
24    Commissioner  by each State bank pursuant to paragraph (a) of
25    subsection (3) of Section 48 of this Act.
26        "Capital" includes the aggregate of  outstanding  capital
27    stock and preferred stock.
28        "Cash  flow reserve account" means the account within the
29    books and records of  the  Commissioner  of  Banks  and  Real
30    Estate   used  to  record  funds  designated  to  maintain  a
31    reasonable Bank and Trust Company Fund operating  balance  to
32    meet agency obligations on a timely basis.
33        "Charter"   includes   the   original   charter  and  all
34    amendments thereto and articles of merger or consolidation.
 
HB2538 Engrossed            -7-                LRB9201093JScs
 1        "Commissioner" means the Commissioner of Banks  and  Real
 2    Estate or a person authorized by the Commissioner, the Office
 3    of  Banks  and  Real  Estate  Act,  or this Act to act in the
 4    Commissioner's stead.
 5        "Commonly owned banks" means 2 or more  banks  that  each
 6    qualify as a bank subsidiary of the same bank holding company
 7    pursuant  to Section 18 of the Federal Deposit Insurance Act;
 8    "commonly owned bank" refers to one of a  group  of  commonly
 9    owned banks but only with respect to one or more of the other
10    banks in the same group.
11        "Community"  means  a city, village, or incorporated town
12    and also includes the area served by the banking offices of a
13    bank, but need not be limited or expanded to conform  to  the
14    geographic  boundaries  of  units of local government in this
15    State.
16        "Company" means a corporation, limited liability company,
17    partnership,  business   trust,   association,   or   similar
18    organization  and,  unless  specifically excluded, includes a
19    "State bank" and a "bank".
20        "Consolidating bank" means a party to a consolidation.
21        "Consolidation" takes place when 2 or more  banks,  or  a
22    trust  company  and  a bank, are extinguished and by the same
23    process a new bank is created, taking  over  the  assets  and
24    assuming  the  liabilities  of  the  banks  or  trust company
25    passing out of existence.
26        "Continuing bank" means a merging bank,  the  charter  of
27    which becomes the charter of the resulting bank.
28        "Converting bank" means a State bank converting to become
29    a  national  bank,  or a national bank converting to become a
30    State bank.
31        "Converting  trust  company"  means   a   trust   company
32    converting to become a State bank.
33        "Court" means a court of competent jurisdiction.
34        "Eligible   depository   institution"  means  an  insured
 
HB2538 Engrossed            -8-                LRB9201093JScs
 1    savings association that is in default,  an  insured  savings
 2    association that is in danger of default, a State or national
 3    bank  that  is in default or a State or national bank that is
 4    in danger of default, as those  terms  are  defined  in  this
 5    Section,  or a new bank as that term defined in Section 11(m)
 6    of the Federal Deposit Insurance Act or a bridge bank as that
 7    term is defined in  Section  11(n)  of  the  Federal  Deposit
 8    Insurance Act or a new federal savings association authorized
 9    under  Section  11(d)(2)(f)  of the Federal Deposit Insurance
10    Act.
11        "Fiduciary"    means    trustee,     agent,     executor,
12    administrator,  committee,  guardian  for  a  minor  or for a
13    person  under  legal   disability,   receiver,   trustee   in
14    bankruptcy,  assignee for creditors, or any holder of similar
15    position of trust.
16        "Financial institution" means a bank,  savings  and  loan
17    association, credit union, or any licensee under the Consumer
18    Installment Loan Act or the Sales Finance Agency Act and, for
19    purposes  of  Section  48.3,  any  proprietary network, funds
20    transfer corporation, or other  entity  providing  electronic
21    funds  transfer  services,  or  any  corporate fiduciary, its
22    subsidiaries,  affiliates,  parent  company,  or  contractual
23    service provider that is examined by the Commissioner.
24        "Foundation" means the Illinois Bank Examiners' Education
25    Foundation.
26        "General  obligation"  means  a  bond,  note,  debenture,
27    security, or other instrument evidencing an obligation of the
28    government entity that is the issuer that is supported by the
29    full available resources of the  issuer,  the  principal  and
30    interest of which is payable in whole or in part by taxation.
31        "Guarantee" means an undertaking or promise to answer for
32    payment  of  another's debt or performance of another's duty,
33    liability, or  obligation  whether  "payment  guaranteed"  or
34    "collection guaranteed".
 
HB2538 Engrossed            -9-                LRB9201093JScs
 1        "In  danger of default" means a State or national bank, a
 2    federally  chartered  insured  savings  association   or   an
 3    Illinois  state  chartered  insured  savings association with
 4    respect to which the Commissioner or the appropriate  federal
 5    banking  agency  has  advised  the  Federal Deposit Insurance
 6    Corporation that:
 7             (1)  in the  opinion  of  the  Commissioner  or  the
 8        appropriate federal banking agency,
 9                  (A)  the  State  or  national  bank  or insured
10             savings association is not likely to be able to meet
11             the demands of  the  State  or  national  bank's  or
12             savings  association's  obligations  in  the  normal
13             course of business; and
14                  (B)  there  is  no reasonable prospect that the
15             State  or   national   bank   or   insured   savings
16             association  will  be  able to meet those demands or
17             pay those obligations without federal assistance; or
18             (2)  in the  opinion  of  the  Commissioner  or  the
19        appropriate federal banking agency,
20                  (A)  the  State  or  national  bank  or insured
21             savings association has incurred  or  is  likely  to
22             incur  losses that will deplete all or substantially
23             all of its capital; and
24                  (B)  there is no reasonable prospect  that  the
25             capital  of  the  State  or national bank or insured
26             savings  association  will  be  replenished  without
27             federal assistance.
28        "In default" means, with respect to a State  or  national
29    bank  or  an insured savings association, any adjudication or
30    other  official  determination  by  any  court  of  competent
31    jurisdiction,  the  Commissioner,  the  appropriate   federal
32    banking agency, or other public authority pursuant to which a
33    conservator,  receiver, or other legal custodian is appointed
34    for  a  State  or  national  bank  or  an   insured   savings
 
HB2538 Engrossed            -10-               LRB9201093JScs
 1    association.
 2        "Insured  savings  association" means any federal savings
 3    association chartered under Section 5  of  the  federal  Home
 4    Owners'  Loan Act and any State savings association chartered
 5    under the  Illinois  Savings  and  Loan  Act  of  1985  or  a
 6    predecessor  Illinois  statute,  the  deposits  of  which are
 7    insured by the Federal Deposit  Insurance  Corporation.   The
 8    term  also  includes  a  savings  bank organized or operating
 9    under the Savings Bank Act.
10        "Insured  savings  association  in  recovery"  means   an
11    insured   savings   association   that  is  not  an  eligible
12    depository institution and that does  not  meet  the  minimum
13    capital  requirements  applicable with respect to the insured
14    savings association.
15        "Issuer" means for purposes of Section  33  every  person
16    who  shall  have  issued  or  proposed to issue any security;
17    except that (1) with  respect  to  certificates  of  deposit,
18    voting trust certificates, collateral-trust certificates, and
19    certificates  of  interest  or  shares  in  an unincorporated
20    investment trust not having a board of directors (or  persons
21    performing  similar  functions), "issuer" means the person or
22    persons performing  the  acts  and  assuming  the  duties  of
23    depositor or manager pursuant to the provisions of the trust,
24    agreement,  or  instrument  under  which  the  securities are
25    issued; (2) with respect to trusts other than those specified
26    in clause (1) above,  where  the  trustee  is  a  corporation
27    authorized  to  accept and execute trusts, "issuer" means the
28    entrusters, depositors, or creators  of  the  trust  and  any
29    manager  or  committee  charged with the general direction of
30    the affairs of the trust pursuant to the  provisions  of  the
31    agreement  or  instrument  creating  the  trust; and (3) with
32    respect to equipment trust certificates or  like  securities,
33    "issuer"  means  the person to whom the equipment or property
34    is or is to be leased or conditionally sold.
 
HB2538 Engrossed            -11-               LRB9201093JScs
 1        "Letter of credit" and "customer" shall have the meanings
 2    ascribed to those terms  in  Section  5-102  of  the  Uniform
 3    Commercial Code.
 4        "Main  banking  premises"  means  the  location  that  is
 5    designated in a bank's charter as its main office.
 6        "Maker  or  obligor" means for purposes of Section 33 the
 7    issuer of a security, the promisor in a  debenture  or  other
 8    debt security, or the mortgagor or grantor of a trust deed or
 9    similar conveyance of a security interest in real or personal
10    property.
11        "Merged  bank"  means  a  merging  bank  that  is not the
12    continuing, resulting, or surviving bank in  a  consolidation
13    or merger.
14        "Merger" includes consolidation.
15        "Merging bank" means a party to a bank merger.
16        "Merging  trust company" means a trust company party to a
17    merger with a State bank.
18        "Mid-tier bank holding company" means a corporation  that
19    (a)  owns  100%  of the issued and outstanding shares of each
20    class  of  stock  of  a  State  bank,  (b)   has   no   other
21    subsidiaries,  and  (c)  100%  of  the issued and outstanding
22    shares of the corporation are owned by a parent bank  holding
23    company.
24        "Municipality"    means   any   municipality,   political
25    subdivision, school district, taxing district, or agency.
26        "National bank"  means  a  national  banking  association
27    located  in  this  State  and  after  May  31,  1997, means a
28    national banking association without regard to its location.
29        "Out-of-state bank" means a bank chartered under the laws
30    of a state other than Illinois, a  territory  of  the  United
31    States, or the District of Columbia.
32        "Parent bank holding company" means a corporation that is
33    a  bank  holding  company  as  that  term  is  defined in the
34    Illinois Bank Holding Company Act of 1957 and  owns  100%  of
 
HB2538 Engrossed            -12-               LRB9201093JScs
 1    the  issued and outstanding shares of a mid-tier bank holding
 2    company.
 3        "Person"  means  an  individual,   corporation,   limited
 4    liability company, partnership, joint venture, trust, estate,
 5    or unincorporated association.
 6        "Public  agency" means the State of Illinois, the various
 7    counties,  townships,   cities,   towns,   villages,   school
 8    districts,   educational   service   regions,   special  road
 9    districts, public water  supply  districts,  fire  protection
10    districts,   drainage   districts,   levee  districts,  sewer
11    districts, housing authorities, the Illinois Bank  Examiners'
12    Education  Foundation,  the  Chicago  Park  District, and all
13    other political corporations or subdivisions of the State  of
14    Illinois,  whether  now  or hereafter created, whether herein
15    specifically mentioned or not, and  shall  also  include  any
16    other  state  or  any political corporation or subdivision of
17    another state.
18        "Public funds" or "public money" means current  operating
19    funds,  special  funds, interest and sinking funds, and funds
20    of any kind or character belonging to, in the custody of,  or
21    subject  to the control or regulation of the United States or
22    a public agency.  "Public  funds"  or  "public  money"  shall
23    include  funds  held  by  any  of  the  officers,  agents, or
24    employees of the United States or of a public agency  in  the
25    course  of  their official duties and, with respect to public
26    money of the United  States,  shall  include  Postal  Savings
27    funds.
28        "Published" means, unless the context requires otherwise,
29    the  publishing  of  the  notice or instrument referred to in
30    some newspaper of general circulation  in  the  community  in
31    which  the  bank  is  located  at  least once each week for 3
32    successive weeks.  Publishing shall be accomplished  by,  and
33    at  the  expense  of,  the  bank  required to publish.  Where
34    publishing  is  required,  the  bank  shall  submit  to   the
 
HB2538 Engrossed            -13-               LRB9201093JScs
 1    Commissioner   that   evidence  of  the  publication  as  the
 2    Commissioner shall deem appropriate.
 3        "Qualified  financial  contract"   means   any   security
 4    contract,  commodity  contract,  forward  contract, including
 5    spot  and  forward  foreign  exchange  contracts,  repurchase
 6    agreement, swap agreement, and  any  similar  agreement,  any
 7    option  to  enter  into  any  such  agreement,  including any
 8    combination of the foregoing, and any  master  agreement  for
 9    such  agreements.  A  master  agreement,  together  with  all
10    supplements  thereto,  shall  be  treated  as  one  qualified
11    financial  contract.   The  contract,  option,  agreement, or
12    combination of contracts, options,  or  agreements  shall  be
13    reflected  upon  the books, accounts, or records of the bank,
14    or a party to the contract shall provide documentary evidence
15    of such agreement.
16        "Recorded" means the filing or recording of the notice or
17    instrument referred to in the office of the Recorder  of  the
18    county wherein the bank is located.
19        "Resulting  bank"  means the bank resulting from a merger
20    or conversion.
21        "Securities" means stocks, bonds, debentures,  notes,  or
22    other similar obligations.
23        "Stand-by  letter  of  credit"  means  a letter of credit
24    under  which  drafts  are  payable  upon  the  condition  the
25    customer has defaulted in performance of a  duty,  liability,
26    or obligation.
27        "State  bank"  means  any  banking corporation that has a
28    banking charter issued by the Commissioner under this Act.
29        "State Banking Board" means the State  Banking  Board  of
30    Illinois.
31        "Subsidiary"  with respect to a specified company means a
32    company that is controlled by  the  specified  company.   For
33    purposes of paragraphs (8) and (12) of Section 5 of this Act,
34    "control"  means  the  exercise  of operational or managerial
 
HB2538 Engrossed            -14-               LRB9201093JScs
 1    control of  a  corporation  by  the  bank,  either  alone  or
 2    together with other affiliates of the bank.
 3        "Surplus"  means  the  aggregate  of  (i) amounts paid in
 4    excess of the par value of capital stock and preferred stock;
 5    (ii) amounts contributed other than  for  capital  stock  and
 6    preferred  stock  and  allocated  to the surplus account; and
 7    (iii) amounts transferred from undivided profits.
 8        "Tier 1 Capital" and "Tier 2 Capital" have  the  meanings
 9    assigned  to  those  terms in regulations promulgated for the
10    appropriate federal banking agency of a state bank, as  those
11    regulations are now or hereafter amended.
12        "Trust  company"  means  a  limited  liability company or
13    corporation incorporated in this State  for  the  purpose  of
14    accepting and executing trusts.
15        "Undivided  profits"  means  undistributed  earnings less
16    discretionary transfers to surplus.
17        "Unimpaired capital  and  unimpaired  surplus",  for  the
18    purposes  of paragraph (21) of Section 5 and Sections 32, 33,
19    34, 35.1, 35.2, and 47 of this Act means the sum of the state
20    bank's Tier 1 Capital and Tier  2  Capital  plus  such  other
21    shareholder  equity  as  may be included by regulation of the
22    Commissioner.   Unimpaired  capital  and  unimpaired  surplus
23    shall be calculated on the basis of  the  date  of  the  last
24    quarterly  call  report filed with the Commissioner preceding
25    the date of the transaction  for  which  the  calculation  is
26    made,  provided  that: (i) when a material event occurs after
27    the date of the last quarterly call  report  filed  with  the
28    Commissioner  that reduces or increases the bank's unimpaired
29    capital and unimpaired surplus  by  10%  or  more,  then  the
30    unimpaired capital and unimpaired surplus shall be calculated
31    from  the  date  of  the  material  event  for  a transaction
32    conducted after the date of the material event; and  (ii)  if
33    the  Commissioner determines for safety and soundness reasons
34    that a state bank should  calculate  unimpaired  capital  and
 
HB2538 Engrossed            -15-               LRB9201093JScs
 1    unimpaired  surplus  more  frequently  than  provided by this
 2    paragraph, the Commissioner may by written notice direct  the
 3    bank  to  calculate unimpaired capital and unimpaired surplus
 4    at a more frequent interval.  In the case  of  a  state  bank
 5    newly  chartered  under  Section 13 or a state bank resulting
 6    from a merger, consolidation, or conversion under Sections 21
 7    through 26 for which no preceding quarterly call  report  has
 8    been  filed  with  the  Commissioner,  unimpaired capital and
 9    unimpaired surplus shall be calculated for the first calendar
10    quarter on the basis of the effective date  of  the  charter,
11    merger, consolidation, or conversion.
12    (Source: P.A.  89-208,  eff.  9-29-95;  89-364, eff. 8-18-95;
13    89-508,  eff.  7-3-96;  89-534,  eff.  1-1-97;  89-567,  eff.
14    7-26-96; 89-626, eff. 8-9-96;  90-14,  eff.  7-1-97;  90-301,
15    eff. 8-1-97.)

16        (205 ILCS 5/5) (from Ch. 17, par. 311)
17        Sec.  5.  General  corporate  powers.   A  bank organized
18    under this Act or subject hereto shall be  a  body  corporate
19    and  politic  and  shall, without specific mention thereof in
20    the charter, have all the powers conferred by  this  Act  and
21    the following additional general corporate powers:
22        (1)  To  sue  and  be  sued,  complain, and defend in its
23    corporate name.
24        (2)  To have a corporate seal, which may  be  altered  at
25    pleasure,  and  to  use the same by causing it or a facsimile
26    thereof  to  be  impressed  or  affixed  or  in  any   manner
27    reproduced, provided that the affixing of a corporate seal to
28    an  instrument shall not give the instrument additional force
29    or effect, or change the construction thereof, and the use of
30    a corporate seal is not mandatory.
31        (3)  To  make,  alter,  amend,  and  repeal  bylaws,  not
32    inconsistent  with  its  charter  or  with   law,   for   the
33    administration  of the affairs of the bank.  If this Act does
 
HB2538 Engrossed            -16-               LRB9201093JScs
 1    not  provide  specific  guidance  in  matters  of   corporate
 2    governance, the provisions of the Business Corporation Act of
 3    1983 may be used if so provided in the bylaws.
 4        (4)  To  elect  or appoint and remove officers and agents
 5    of  the  bank  and  define  their  duties   and   fix   their
 6    compensation.
 7        (5)  To   adopt   and  operate  reasonable  bonus  plans,
 8    profit-sharing plans, stock-bonus plans, stock-option  plans,
 9    pension  plans and similar incentive plans for its directors,
10    officers and employees.
11        (5.1)  To manage, operate and administer a fund  for  the
12    investment of funds by a public agency or agencies, including
13    any  unit  of  local  government  or  school district, or any
14    person.  The fund for a public agency  shall  invest  in  the
15    same   type  of  investments  and  be  subject  to  the  same
16    limitations provided for the investment of public funds.  The
17    fund for public agencies shall  maintain  a  separate  ledger
18    showing  the  amount  of investment for each public agency in
19    the fund. "Public funds" and "public agency" as used in  this
20    Section shall have the meanings ascribed to them in Section 1
21    of the Public Funds Investment Act.
22        (6)  To  make reasonable donations for the public welfare
23    or  for  charitable,  scientific,  religious  or  educational
24    purposes.
25        (7)  To borrow or incur an obligation; and to pledge  its
26    assets:
27             (a)  to secure its borrowings, its lease of personal
28        or real property or its other nondeposit obligations;
29             (b)  to  enable  it  to act as agent for the sale of
30        obligations of the United States;
31             (c)  to secure  deposits  of  public  money  of  the
32        United  States,  whenever  required  by  the  laws of the
33        United  States,  including  without  being  limited   to,
34        revenues and funds the deposit of which is subject to the
 
HB2538 Engrossed            -17-               LRB9201093JScs
 1        control  or regulation of the United States or any of its
 2        officers, agents, or employees and Postal Savings funds;
 3             (d)  to secure deposits of public money of any state
 4        or of any political corporation  or  subdivision  thereof
 5        including,  without  being limited to, revenues and funds
 6        the deposit  of  which  is  subject  to  the  control  or
 7        regulation  of  any state or of any political corporation
 8        or subdivisions thereof or  of  any  of  their  officers,
 9        agents, or employees;
10             (e)  to  secure  deposits of money whenever required
11        by the National Bankruptcy Act;
12             (f)  (blank); and
13             (g)  to  secure  trust  funds  commingled  with  the
14        bank's  funds,  whether  deposited  by  the  bank  or  an
15        affiliate of the bank, pursuant to  Section  2-8  of  the
16        Corporate Fiduciary Act.
17        (8)  To  own, possess, and carry as assets all or part of
18    the real estate necessary in or with which to do its  banking
19    business, either directly or indirectly through the ownership
20    of  all  or part of the capital stock, shares or interests in
21    any corporation, association, trust engaged  in  holding  any
22    part  or  parts  or all of the bank premises, engaged in such
23    business and in conducting a safe  deposit  business  in  the
24    premises or part of them, or engaged in any activity that the
25    bank  is  permitted  to  conduct  in a subsidiary pursuant to
26    paragraph (12) of this Section 5.
27        (9)  To own, possess, and  carry  as  assets  other  real
28    estate  to which it may obtain title in the collection of its
29    debts or that was  formerly  used  as  a  part  of  the  bank
30    premises,  but  title  to  any  real  estate except as herein
31    permitted shall not be retained by the bank, either  directly
32    or  by  or  through  a subsidiary, as permitted by subsection
33    (12) of this Section for a total period of more than 10 years
34    after acquiring title, either directly or indirectly.
 
HB2538 Engrossed            -18-               LRB9201093JScs
 1        (10)  To do any act, including the acquisition of  stock,
 2    necessary  to  obtain  insurance  of  its  deposits,  or part
 3    thereof, and any act necessary to obtain a guaranty, in whole
 4    or in part, of any of its loans or investments by the  United
 5    States  or  any agency thereof, and any act necessary to sell
 6    or otherwise dispose of any of its loans  or  investments  to
 7    the  United  States or any agency thereof, and to acquire and
 8    hold membership in the Federal Reserve System.
 9        (11)  Notwithstanding any other provisions of this Act or
10    any other law, to do any act and to own, possess,  and  carry
11    as assets property of the character, including stock, that is
12    at  the  time authorized or permitted to national banks by an
13    Act of Congress, but subject always to the  same  limitations
14    and  restrictions  as are applicable to national banks by the
15    pertinent federal law and subject to applicable provisions of
16    the Financial Institutions Insurance Sales Law.
17        (12)  To own, possess, and carry as assets stock  of  one
18    or  more corporations that is, or are, engaged in one or more
19    of the following businesses:
20             (a)  holding  title  to  and  administering   assets
21        acquired  as a result of the collection or liquidating of
22        loans, investments, or discounts; or
23             (b)  holding title  to  and  administering  personal
24        property  acquired  by  the  bank, directly or indirectly
25        through a subsidiary,  for  the  purpose  of  leasing  to
26        others,  provided  the lease or leases and the investment
27        of the bank, directly or through a  subsidiary,  in  that
28        personal  property  otherwise comply with Section 35.1 of
29        this Act; or
30             (c)  carrying  on  or  administering  any   of   the
31        activities  excepting  the  receipt  of  deposits  or the
32        payment of checks or other  orders  for  the  payment  of
33        money  in  which  a  bank  may  engage in carrying on its
34        general banking business; provided, however, that nothing
 
HB2538 Engrossed            -19-               LRB9201093JScs
 1        contained in this paragraph (c) shall be deemed to permit
 2        a bank organized under this Act or subject hereto to  do,
 3        either directly or indirectly through any subsidiary, any
 4        act,  including  the making of any loan or investment, or
 5        to own, possess, or carry as assets any property that  if
 6        done by or owned, possessed, or carried by the State bank
 7        would  be  in violation of or prohibited by any provision
 8        of this Act.
 9        The provisions of this subsection (12) shall not apply to
10    and shall not be deemed to limit the powers of a  State  bank
11    with  respect  to  the ownership, possession, and carrying of
12    stock that a State bank is  permitted  to  own,  possess,  or
13    carry under this Act.
14        Any  bank  intending to establish a subsidiary under this
15    subsection (12) shall give written notice to the Commissioner
16    60 days prior to the subsidiary's commencing of business  or,
17    as the case may be, prior to acquiring stock in a corporation
18    that  has  already  commenced  business.  After receiving the
19    notice, the Commissioner may waive or reduce the  balance  of
20    the  60  day notice period.  The Commissioner may specify the
21    form of the notice and may promulgate rules  and  regulations
22    to administer this subsection (12).
23        (13)  To   accept  for  payment  at  a  future  date  not
24    exceeding one year from the date of acceptance, drafts  drawn
25    upon  it  by  its customers; and to issue, advise, or confirm
26    letters of credit authorizing the  holders  thereof  to  draw
27    drafts upon it or its correspondents.
28        (14)  To  own and lease personal property acquired by the
29    bank at the request of a  prospective  lessee  and  upon  the
30    agreement  of  that  person  to  lease  the personal property
31    provided that the lease, the agreement with respect  thereto,
32    and  the amount of the investment of the bank in the property
33    comply with Section 35.1 of this Act.
34        (15) (a)  To establish and maintain, in addition  to  the
 
HB2538 Engrossed            -20-               LRB9201093JScs
 1        main  banking  premises,  branches  offering  any banking
 2        services permitted at the  main  banking  premises  of  a
 3        State bank.
 4             (b)  To  establish and maintain, after May 31, 1997,
 5        branches in another state that may conduct  any  activity
 6        in  that  state  that  is authorized or permitted for any
 7        bank that has a banking charter  issued  by  that  state,
 8        subject to the same limitations and restrictions that are
 9        applicable to banks chartered by that state.
10        (16)  (Blank).
11        (17)  To  establish and maintain terminals, as authorized
12    by the Electronic Fund Transfer Act.
13        (18)  To establish and maintain temporary service  booths
14    at  any  International  Fair  held  in  this  State  which is
15    approved by the United States Department of Commerce, for the
16    duration of the international fair for the  sole  purpose  of
17    providing  a  convenient place for foreign trade customers at
18    the fair to exchange  their  home  countries'  currency  into
19    United  States currency or the converse. This power shall not
20    be construed  as  establishing  a  new  place  or  change  of
21    location for the bank providing the service booth.
22        (19)  To  indemnify  its  officers, directors, employees,
23    and agents, as authorized for corporations under Section 8.75
24    of the Business Corporation Act of 1983.
25        (20)  To own, possess, and carry as assets stock  of,  or
26    be  or  become  a member of, any corporation, mutual company,
27    association, trust, or other entity  formed  exclusively  for
28    the  purpose  of providing directors' and officers' liability
29    and bankers' blanket bond insurance or reinsurance to and for
30    the benefit of the stockholders, members,  or  beneficiaries,
31    or  their assets or businesses, or their officers, directors,
32    employees, or agents, and not to or for the  benefit  of  any
33    other person or entity or the public generally.
34        (21)  To  make debt or equity investments in corporations
 
HB2538 Engrossed            -21-               LRB9201093JScs
 1    or projects, whether for profit or not for  profit,  designed
 2    to  promote the development of the community and its welfare,
 3    provided that  the  aggregate  investment  in  all  of  these
 4    corporations and in all of these projects does not exceed 10%
 5    of  the unimpaired capital and unimpaired surplus of the bank
 6    and  provided  that  this  limitation  shall  not  apply   to
 7    creditworthy  loans  by  the  bank  to  those corporations or
 8    projects.  Upon written application to  the  Commissioner,  a
 9    bank  may make an investment that would, when aggregated with
10    all other such investments,  exceed  10%  of  the  unimpaired
11    capital  and unimpaired surplus of the bank. The Commissioner
12    may approve the investment if he is of the opinion and  finds
13    that the proposed investment will not have a material adverse
14    effect on the safety and soundness of the bank.
15        (22)  To own, possess, and carry as assets the stock of a
16    corporation engaged in the ownership or operation of a travel
17    agency  or  to  operate  a  travel  agency  as  a part of its
18    business, provided that the bank either owned, possessed, and
19    carried as assets the stock of such a corporation or operated
20    a travel agency as part of its business before July 1, 1991.
21        (23)  With respect to affiliate facilities:
22             (a)  to conduct at affiliate facilities for  and  on
23        behalf  of  another commonly owned bank, if so authorized
24        by the other bank, all transactions that the  other  bank
25        is authorized or permitted to perform; and
26             (b)  to  authorize  a commonly owned bank to conduct
27        for and on behalf of it any of  the  transactions  it  is
28        authorized  or  permitted  to  perform  at  one  or  more
29        affiliate facilities.
30        Any  bank intending to conduct or to authorize a commonly
31    owned bank to conduct at an affiliate  facility  any  of  the
32    transactions  specified  in  this  paragraph  (23) shall give
33    written notice to the Commissioner at least  30  days  before
34    any such transaction is conducted at the affiliate facility.
 
HB2538 Engrossed            -22-               LRB9201093JScs
 1        (24)  To  act  as  the agent for any fire, life, or other
 2    insurance company authorized by the  State  of  Illinois,  by
 3    soliciting  and  selling insurance and collecting premiums on
 4    policies issued by such company; and to receive for  services
 5    so  rendered  such  fees or commissions as may be agreed upon
 6    between the bank and the insurance company for which  it  may
 7    act  as  agent; provided, however, that no such bank shall in
 8    any case assume or guarantee the payment of  any  premium  on
 9    insurance   policies   issued   through  its  agency  by  its
10    principal; and provided further,  that  the  bank  shall  not
11    guarantee  the  truth  of any statement made by an assured in
12    filing his application for insurance.
13        (25)  Notwithstanding any other provisions of this Act or
14    any other law, to offer any product or service that is at the
15    time  authorized  or  permitted  to   any   insured   savings
16    association  or out-of-state bank by applicable law, provided
17    that powers conferred only by this subsection (25):
18             (a)  shall always be subject to the same limitations
19        and restrictions  that  are  applicable  to  the  insured
20        savings  association or out-of-state bank for the product
21        or service by such applicable law;
22             (b)  shall be subject to  applicable  provisions  of
23        the Financial Institutions Insurance Sales Law;
24             (c)  shall not include the right to own or conduct a
25        real  estate brokerage business for which a license would
26        be required under the laws of this State; and
27             (d)  shall  not  be   construed   to   include   the
28        establishment  or maintenance of a branch, nor shall they
29        be construed to limit the establishment or maintenance of
30        a branch pursuant to subsection (11).
31    (Source: P.A.  90-41,  eff.  10-1-97;  90-301,  eff.  8-1-97;
32    90-655, eff. 7-30-98;  90-665,  eff.  7-30-98;  91-330,  eff.
33    7-29-99; 91-849, eff. 6-22-00.)
 
HB2538 Engrossed            -23-               LRB9201093JScs
 1        (205 ILCS 5/5b) (from Ch. 17, par. 312.1)
 2        Sec. 5b.  Deposits in outside depository.
 3        (a)  Except  as provided in subsection (b), every bank is
 4    liable for deposits made in an outside  depository  from  the
 5    time the deposit is made.
 6        (b)  A  bank  may  adopt  a policy that its liability for
 7    deposits made in outside depositories will be  delayed  until
 8    the  deposits  are recorded, and, if such a policy is adopted
 9    and depositors are notified in writing at least  21  days  in
10    advance  of  the  effective  date  of such policy, the bank's
11    liability will be delayed in accordance with the policy.   In
12    case  of  deposit  accounts  opened  after  such  a policy is
13    adopted, the policy shall be effective if  the  depositor  is
14    given  written  notice  of the policy at the time the deposit
15    account is opened.
16        (c)  For  the   purposes   of   this   Section   "outside
17    depository"  means  any receptacle attached to a main banking
18    premise, or branch, as allowed in subsection (15) of  Section
19    5  of  this  Act, or other location for the purpose of making
20    deposits either during or after regular  banking  hours,  but
21    does not include an automatic teller machine or point of sale
22    terminal, as defined in the Electronic Fund Transfer Act.
23    (Source: P.A. 88-273; 89-310, eff. 1-1-96.)

24        (205 ILCS 5/7) (from Ch. 17, par. 314)
25        Sec.  7. Organization capital requirements. A bank may be
26    organized to exercise the powers conferred by this  Act  with
27    minimum   capital   and   surplus   as   determined   by  the
28    Commissioner.    The   Commissioner   shall    record    such
29    organization  capital  requirements  in  the  Office  of  the
30    Secretary of State.
31    (Source: P.A. 90-301, eff. 8-1-97.)

32        (205 ILCS 5/8) (from Ch. 17, par. 315)
 
HB2538 Engrossed            -24-               LRB9201093JScs
 1        Sec.  8.  Incorporators. A State bank may be organized on
 2    application  by  5  or  more  incorporators  who   shall   be
 3    individuals  except  that  a  bank holding company may be the
 4    sole incorporator of a State bank.  Each  incorporator  shall
 5    undertake  to  subscribe  and  pay  in full in cash for stock
 6    having a value of not less than one per cent of  the  minimum
 7    capital  and  surplus requirements as set forth in Section 7,
 8    except that incorporators of a State bank that will be  owned
 9    by  a  bank  holding company may subscribe and pay in full in
10    cash for stock of the bank holding company, provided that the
11    incorporator's investment in the bank holding company must at
12    least equal the amount of money that would have  been  needed
13    for  the  incorporator  to acquire shares of the bank's stock
14    pursuant to this Section.
15    (Source: P.A. 90-301, eff. 8-1-97.)

16        (205 ILCS 5/10) (from Ch. 17, par. 317)
17        Sec. 10. Permit to organize.
18        (a)  Upon the filing of an application for  a  permit  to
19    organize, the Commissioner shall investigate the truth of the
20    statements  therein  and  shall  consider the proposed bank's
21    capital structure, its future earnings prospects, the general
22    character, experience, and  qualifications  of  its  proposed
23    management,   its   proposed   plan  of  operation,  and  the
24    convenience and needs of the area sought to  be  served,  and
25    notwithstanding  the provisions of Section 7 of this Act, the
26    Commissioner shall not approve the application  and  issue  a
27    permit  to  organize  unless  he  shall be of the opinion and
28    finds:
29             (1)  that the proposed capital at  least  meets  the
30        minimum  requirements  of  this  Act  determined  by  the
31        Commissioner  pursuant to Section 7 of this Act including
32        additional capital necessitated by the  circumstances  of
33        the   proposed   bank   including  its  size,   scope  of
 
HB2538 Engrossed            -25-               LRB9201093JScs
 1        operations and market in which it proposes to operate;
 2             (2)  that  the   future   earnings   prospects   are
 3        favorable;
 4             (3)  that  the  general  character,  experience, and
 5        qualifications  of  its  proposed  management   and   its
 6        proposed   plan  of  operation  are  such  as  to  assure
 7        reasonable  promise  of  successful,   safe   and   sound
 8        operation;
 9             (4)  that  the  name of the proposed bank is not the
10        same as or deceptively similar to a  name  reserved  with
11        the  Commissioner's  office  under  Section 9.5 or to the
12        name of any other bank then operating in this State; and
13             (5)  that the convenience  and  needs  of  the  area
14        sought  to  be  served  by  the  proposed  bank  will  be
15        promoted.
16        (b)  The Commissioner shall revoke the permit to organize
17    and  order  liquidation  of  any funds collected in the event
18    that  the  organizers  do  not  obtain  a  charter  from  the
19    Commissioner authorizing the bank to commence business within
20    6 months from the date of the issuance of the permit,  unless
21    a request has been submitted, in writing, to the Commissioner
22    for an extension and the request has been approved.
23        (c)  The   Commissioner   may   impose   such  terms  and
24    conditions, if any, on the issuance of the permit to organize
25    as the Commissioner deems appropriate and necessary  for  the
26    organization of the bank.
27    (Source: P.A. 90-665, eff. 7-30-98; 91-452, eff. 1-1-00.)

28        (205 ILCS 5/12) (from Ch. 17, par. 319)
29        Sec. 12. Organization.
30        (a)  The  directors  so  elected  shall  may  proceed  to
31    organize in conformity with this Act and as follows:
32             (1)  To qualify themselves as directors.
33             (2)  To elect one of their number as president.
 
HB2538 Engrossed            -26-               LRB9201093JScs
 1             (3)  To make and adopt by-laws not inconsistent with
 2        its  charter  or  with  law for the administration of the
 3        affairs of the bank.
 4             (4)  To appoint such officers  as  the  by-laws  may
 5        provide, and fix the salaries of all officers.
 6             (5)  To  furnish  to  the  Commissioner lists of the
 7        stockholders  and  copies  of  any  other   records   the
 8        Commissioner may require.
 9             (6)  To  collect  the  subscriptions  to the capital
10        stock and to the preferred stock, if any,  including  the
11        surplus and the reserves for operating expenses.
12             (6.5)  To notify the Commissioner of any significant
13        deviation  or  change from the original plan of operation
14        or  proposed  business  activities  submitted  with   the
15        application for a permit to organize.
16             (7)  To report the organization to the Commissioner.
17        (b)  Subscriptions  to  the  capital  stock  and  to  the
18    preferred  stock,  if  any, collected pursuant to item (6) of
19    subsection (a) of this Section must be placed in escrow.
20    (Source: P.A. 85-204.)

21        (205 ILCS 5/13) (from Ch. 17, par. 320)
22        Sec. 13.  Issuance of charter.
23        (a)  When the directors have  organized  as  provided  in
24    Section  12  of  this  Act,  and  the  capital  stock and the
25    preferred stock, if any, together with a surplus of not  less
26    than  50%  of  the  capital, has been all fully paid in and a
27    record  of  the  same  filed  with  the   Commissioner,   the
28    Commissioner  or  some competent person of the Commissioner's
29    appointment  shall  make  a  thorough  examination  into  the
30    affairs of the proposed bank, and if satisfied (i)  that  all
31    the  requirements  of  this Act have been complied with, (ii)
32    that no intervening circumstance has occurred to  change  the
33    Commissioner's  findings  made pursuant to Section 10 of this
 
HB2538 Engrossed            -27-               LRB9201093JScs
 1    Act, and (iii) that the prior involvement by any  stockholder
 2    who will own a sufficient amount of stock to have control, as
 3    defined  in Section 18 of this Act, of the proposed bank with
 4    any other  financial  institution,  whether  as  stockholder,
 5    director,  officer,  or customer, was conducted in a safe and
 6    sound manner, upon payment into the Commissioner's office  of
 7    the  reasonable expenses of the examination, as determined by
 8    the Commissioner, the  Commissioner  shall  issue  a  charter
 9    authorizing  the  bank  to commence business as authorized in
10    this Act.  All charters issued by  the  Commissioner  or  any
11    predecessor agency which chartered State banks, including any
12    charter  outstanding  as  of  September  1,  1989,  shall  be
13    perpetual.  For the 2 years after the Commissioner has issued
14    a  charter  to a bank, the bank shall request and obtain from
15    the Commissioner prior written approval before it may  change
16    senior management personnel or directors.
17        The original charter, duly certified by the Commissioner,
18    or  a  certified  copy  shall  be  evidence in all courts and
19    places of the existence and  authority  of  the  bank  to  do
20    business.    Upon   the   issuance  of  the  charter  by  the
21    Commissioner, the bank shall be deemed  fully  organized  and
22    may  proceed  to  do  business.  The Commissioner may, in the
23    Commissioner's  discretion,  withhold  the  issuing  of   the
24    charter  when the Commissioner has reason to believe that the
25    bank  is  organized  for  any   purpose   other   than   that
26    contemplated by this Act or that a commission or fee has been
27    paid  in  connection  with the sale of the stock of the bank.
28    The  Commissioner  shall  revoke  the   charter   and   order
29    liquidation  in  the  event that the bank does not commence a
30    general banking business within one year from the date of the
31    issuance of the charter, unless a request has been submitted,
32    in writing, to the Commissioner  for  an  extension  and  the
33    request  has  been  approved.   After  commencing  a  general
34    banking  business,  a  bank  may  change  its  name by filing
 
HB2538 Engrossed            -28-               LRB9201093JScs
 1    written notice with the Commissioner at least 30  days  prior
 2    to the effective date of such change.  A bank chartered under
 3    this  Act  may  change  its  main  banking premises by filing
 4    written  application  with   the   Commissioner,   on   forms
 5    prescribed by the Commissioner, provided (i) the change shall
 6    not be a removal to a new location without complying with the
 7    capital  requirements  of  Section 7 and of subsection (1) of
 8    Section 10 of this Act; (ii) the  Commissioner  approves  the
 9    relocation  or  change;  and (iii) the bank complies with any
10    applicable federal law or regulation.  The application  shall
11    be deemed to be approved if the Commissioner has not acted on
12    the   application   within  30  days  after  receipt  of  the
13    application,  unless  within  the  30-day  time   frame   the
14    Commissioner  informs  the  bank that an extension of time is
15    necessary  prior  to  the  Commissioner's   action   on   the
16    application.
17        (b) (1)  The  Commissioner  may also issue a charter to a
18    bank  that  is  owned   exclusively   by   other   depository
19    institutions  or depository institution holding companies and
20    is organized to engage exclusively in providing  services  to
21    or   for   other   depository   institutions,  their  holding
22    companies, and the officers, directors, and employees of such
23    institutions and companies, and  in  providing  correspondent
24    banking   services   at   the  request  of  other  depository
25    institutions or their holding companies (also referred to  as
26    a "bankers' bank").
27        (2)  A  bank  chartered  pursuant to paragraph (1) shall,
28    except as otherwise specifically determined or limited by the
29    Commissioner in an order or pursuant to  a  rule,  be  vested
30    with  the  same rights and privileges and subject to the same
31    duties,  restrictions,  penalties,  and  liabilities  now  or
32    hereafter imposed under this Act.
33        (c)  A bank chartered under this Act  after  November  1,
34    1985,  and an out-of-state bank that merges with a State bank
 
HB2538 Engrossed            -29-               LRB9201093JScs
 1    and establishes or maintains a branch in this State after May
 2    31, 1997, shall obtain  from  and,  at  all  times  while  it
 3    accepts  or  retains  deposits,  maintain  with  the  Federal
 4    Deposit  Insurance Corporation, or such other instrumentality
 5    of or corporation chartered by  the  United  States,  deposit
 6    insurance as authorized under federal law.
 7        (d) (i)  A  bank that has a banking charter issued by the
 8    Commissioner under  this  Act  may,  pursuant  to  a  written
 9    purchase and assumption agreement, transfer substantially all
10    of  its  assets  to  another  State  bank or national bank in
11    consideration, in whole or in part, for the transferee banks'
12    assumption of any part or all of  its  liabilities.   Such  a
13    transfer  shall  in no way be deemed to impair the charter of
14    the transferor bank or cause the transferor bank  to  forfeit
15    any   of   its  rights,  powers,  interests,  franchises,  or
16    privileges as a State bank, nor shall any voluntary reduction
17    in  the  transferor  bank's  activities  resulting  from  the
18    transfer have any such  effect;  provided,  however,  that  a
19    State  bank  that  transfers  substantially all of its assets
20    pursuant to this subsection (d) and  following  the  transfer
21    does  not  accept deposits and make loans, shall not have any
22    rights, powers, interests, franchises,  or  privileges  under
23    subsection  (15)  of Section 5 of this Act until the bank has
24    resumed accepting deposits and making loans.
25        (ii)  The  fact  that  a  State  bank  does  not   resume
26    accepting deposits and making loans for a period of 24 months
27    commencing on September 11, 1989 or on a date of the transfer
28    of  substantially  all of a State bank's assets, whichever is
29    later, or such longer period as the Commissioner may allow in
30    writing, may be the basis for a finding by  the  Commissioner
31    under  Section  51  of  this  Act  that the bank is unable to
32    continue operations.
33        (iii)  The authority provided by subdivision (i) of  this
34    subsection  (d)  shall terminate on May 31, 1997, and no bank
 
HB2538 Engrossed            -30-               LRB9201093JScs
 1    that has transferred substantially all of its assets pursuant
 2    to this subsection (d) shall continue in existence after  May
 3    31, 1997.
 4    (Source:  P.A.  90-14,  eff.  7-1-97;  90-301,  eff.  8-1-97;
 5    90-665, eff. 7-30-98; 91-322, eff. 1-1-00.)

 6        (205 ILCS 5/13.5)
 7        Sec. 13.5.  Formation and merger of interim banks.
 8        (a)  An interim bank may be chartered as a State bank for
 9    the   exclusive   purpose   of   accomplishing   a  corporate
10    restructuring through merger with  an  existing  State  bank,
11    national   bank,   trust   company,  or  an  insured  savings
12    association.  An interim bank shall be chartered  and  merged
13    pursuant to the provisions of this Section.  The interim bank
14    shall  not accept deposits, make loans, pay checks, or engage
15    in the general banking business  or  any  part  thereof,  and
16    shall not be subject to the provisions of this Act other than
17    those  set  forth in this Section; provided, however, that if
18    the interim bank becomes the resulting bank in a merger, such
19    resulting bank shall have all  of  the  powers,  rights,  and
20    duties  of  a  State bank and must comply with all applicable
21    provisions of this Act.
22        (b)  An  interim  State  bank  may  be   organized   upon
23    application  by  5 or more incorporators or by a bank holding
24    company.  The application shall be made on  forms  prescribed
25    by  the  Commissioner  which shall request, at a minimum, the
26    following information:
27             (1)  the names and addresses of the incorporators;
28             (2)  the proposed name and address  of  the  interim
29        bank;
30             (3)  the  name  and  address of all banks with which
31        the interim bank will be merging;
32             (4)  a copy of the merger  agreement  by  which  the
33        interim  bank will be merged with the banks identified in
 
HB2538 Engrossed            -31-               LRB9201093JScs
 1        item (3) containing  the  same  information  required  in
 2        merger  agreements  pursuant to subsection (1) of Section
 3        22 of this Act; and
 4             (5)  an acknowledgement that the interim bank  shall
 5        not  engage  in  the general banking business or any part
 6        thereof unless and until the  interim  bank  becomes  the
 7        resulting bank in a merger.
 8        (c)  The  merger agreement must be approved by all of the
 9    incorporators of the interim bank and must be approved by the
10    existing State bank with which the interim bank  will  merge,
11    as required by Section 22 of this Act.
12        (d)  Upon  receipt  of  the  application  to organize the
13    interim bank and the merger agreement submitted  pursuant  to
14    this Section and Section 22 of this Act, the Commissioner may
15    issue  a  charter  to the interim bank and approve the merger
16    agreement if the Commissioner makes the findings set forth in
17    subsection (3) of Section 22 of this Act.  The interim bank's
18    charter shall not  take  effect  until,  and  shall  only  be
19    effective for purposes of, the merger.
20        (e)  Nothing  in  this Section affects the obligations of
21    an existing State bank  with  which  the  interim  bank  will
22    merge,  or  the rights of minority or dissenting shareholders
23    of the existing State bank, in connection with the  approval,
24    execution,  and  accomplishment  of  a  merger  agreement  as
25    provided elsewhere in this Act.
26    (Source: P.A. 90-301, eff. 8-1-97.)

27        (205 ILCS 5/14) (from Ch. 17, par. 321)
28        Sec.  14.  Stock.   Unless otherwise provided for in this
29    Act provisions of general application to  stock  of  a  state
30    bank shall be as follows:
31        (1)  All  banks  shall  have  their  capital divided into
32    shares of a par value of not less than $1 one dollar each and
33    not more than $100 one hundred dollars each, however, the par
 
HB2538 Engrossed            -32-               LRB9201093JScs
 1    value of shares of a bank effecting  a  reverse  stock  split
 2    pursuant  to  item  (8)  of  subsection (a) of Section 17 may
 3    temporarily exceed this limit provided  it  conforms  to  the
 4    limits   immediately   after   the  reverse  stock  split  is
 5    completed. No issue of capital stock or preferred stock shall
 6    be valid until not less than the par value of all such  stock
 7    so  issued  shall  be  paid  in  and  notice  thereof  by the
 8    president, a vice-president or cashier of the bank  has  been
 9    transmitted  to  the Commissioner. In the case of an increase
10    in capital stock by the declaration of a stock dividend,  the
11    capitalization  of  retained  earnings effected by such stock
12    dividend  shall  constitute  the  payment  for  such   shares
13    required by the preceding sentence, provided that the surplus
14    of  said  bank  after  such  stock dividend shall be at least
15    equal to fifty per cent of  the  capital  as  increased.  The
16    charter  shall  not  limit  or  deny  the voting power of the
17    shares of any class of stock except as  provided  in  Section
18    15(3) of this Act.
19        (2)  Pursuant  to  action  taken  in  accordance with the
20    requirements of Section 17, a bank may issue preferred  stock
21    of   one  or  more  classes  as  shall  be  approved  by  the
22    Commissioner as hereinafter provided, and make such amendment
23    to its charter as may be necessary for this purpose;  but  in
24    the case of any newly organized bank which has not yet issued
25    capital stock the requirements of Section 17 shall not apply.
26        (3)  Without  limiting  the  authority herein contained a
27    bank, when so provided in its charter and  when  approved  by
28    the Commissioner, may issue shares of preferred stock:
29             (a)  Subject  to the right of the bank to redeem any
30        of such shares at not exceeding the price  fixed  by  the
31        charter for the redemption thereof;
32             (b)  Subject  to the provisions of subsection (8) of
33        this  Section  14  entitling  the  holders   thereof   to
34        cumulative or noncumulative dividends;
 
HB2538 Engrossed            -33-               LRB9201093JScs
 1             (c)  Having  preference  over  any  other  class  or
 2        classes of shares as to the payment of dividends;
 3             (d)  Having  preference as to the assets of the bank
 4        over any other  class  or  classes  of  shares  upon  the
 5        voluntary or involuntary liquidation of the bank;
 6             (e)  Convertible  into  shares of any other class of
 7        stock,  provided  that  preferred  shares  shall  not  be
 8        converted into shares of a  different  par  value  unless
 9        that  part of the capital of the bank represented by such
10        preferred shares is at the time of the  conversion  equal
11        to  the  aggregate par value of the shares into which the
12        preferred shares are to be converted.
13        (4)  If any part of the capital of  a  bank  consists  of
14    preferred  stock,  the  determination  of  whether or not the
15    capital of such bank is  impaired  and  the  amount  of  such
16    impairment  shall  be  based  upon the par value of its stock
17    even though the amount which the holders  of  such  preferred
18    stock shall be entitled to receive in the event of retirement
19    or  liquidation  shall  be in excess of the par value of such
20    preferred stock.
21        (5)  Pursuant to action  taken  in  accordance  with  the
22    requirements  of  Section  17  of  this Act, a state bank may
23    provide for a specified number  of  authorized  but  unissued
24    shares  of  capital  stock  for  one or more of the following
25    purposes:
26             (a)  Reserved for issuance under stock  option  plan
27        or plans to directors, officers or employees;
28             (b)  Reserved   for   issuance  upon  conversion  of
29        convertible preferred stock issued  pursuant  to  and  in
30        compliance with the provisions of subsections (2) and (3)
31        of this Section 14.
32             (c)  Reserved   for   issuance  upon  conversion  of
33        convertible debentures or other convertible evidences  of
34        indebtedness issued by a state bank, provided always that
 
HB2538 Engrossed            -34-               LRB9201093JScs
 1        the  terms  of  such conversion have been approved by the
 2        Commissioner;
 3             (d)  Reserved for issuance by the declaration  of  a
 4        stock  dividend.  If and when any shares of capital stock
 5        are proposed to be authorized and reserved for any of the
 6        purposes set forth  in  subparagraphs  (a),  (b)  or  (c)
 7        above,  the  notice  of  the  meeting, whether special or
 8        annual, of stockholders at which such proposition  is  to
 9        be considered shall be accompanied by a statement setting
10        forth  or  summarizing the terms upon which the shares of
11        capital stock so reserved  are  to  be  issued,  and  the
12        extent to which any preemptive rights of stockholders are
13        inapplicable to the issuance of the shares so reserved or
14        to   the   convertible  preferred  stock  or  convertible
15        debentures   or   other    convertible    evidences    of
16        indebtedness, and the approving vote of the holders of at
17        least  two-thirds  of  the  outstanding  shares  of stock
18        entitled to vote at such meeting of  the  terms  of  such
19        issuance  shall  be  requisite  for  the  adoption of any
20        amendment providing for the reservation of authorized but
21        unissued shares for any of said purposes. Nothing in this
22        subsection (5) contained shall be deemed to authorize the
23        issuance of any capital stock for  a  consideration  less
24        than the par value thereof.
25        (6)  Upon written application to the Commissioner 60 days
26    prior  to  the  proposed  purchase and receipt of the written
27    approval of the Commissioner, a state bank may  purchase  and
28    hold  as  treasury  stock such amounts of the total number of
29    issued and outstanding shares of its  capital  and  preferred
30    stock   outstanding   as   the   Commissioner  determines  is
31    consistent with  safety  and  soundness  of  the  bank.   The
32    Commissioner  may  specify  the  manner of accounting for the
33    treasury stock and the  form  of  notice  prior  to  ultimate
34    disposition  of  the  shares.   Except  as authorized in this
 
HB2538 Engrossed            -35-               LRB9201093JScs
 1    subsection, it shall not  be  lawful  for  a  state  bank  to
 2    purchase  or  hold  any  additional such shares or securities
 3    described in subsection (2) of Section 37 unless necessary to
 4    prevent loss upon a debt previously contracted in good faith,
 5    in which event such shares  or  securities  so  purchased  or
 6    acquired  shall, within 6 months from the time of purchase or
 7    acquisition, be sold or disposed  of  at  public  or  private
 8    sale.   Any  state  bank  which  intends to purchase and hold
 9    treasury stock as authorized in  this  subsection  (6)  shall
10    file  a  written  application  with  the Commissioner 60 days
11    prior to any such proposed purchase.  The  application  shall
12    state the number of shares to be purchased, the consideration
13    for  the shares, the name and address of the person from whom
14    the shares are to be  purchased,  if  known,  and  the  total
15    percentage of its issued and outstanding shares to be held by
16    the bank after the purchase.  The total consideration paid by
17    a  state  bank  for  treasury  stock shall reduce capital and
18    surplus of the bank for purposes  of  Sections  of  this  Act
19    relating  to  lending  and  investment  limits  which require
20    computation of capital and  surplus.  After  considering  and
21    approving  an application to purchase and hold treasury stock
22    under this subsection, the Commissioner may waive  or  reduce
23    the   balance   of   the   60  day  application  period.  The
24    Commissioner may specify the  form  of  the  application  for
25    approval  to  acquire treasury stock and promulgate rules and
26    regulations for the administration of this subsection (6).  A
27    state bank may, acquire or resell its owns shares as treasury
28    stock pursuant to this subsection (6) without a change in its
29    charter pursuant to Section 17.  Such stock may be  held  for
30    any purpose permitted in subsection (5) of this Section 14 or
31    may  be  resold  upon  such  reasonable terms as the board of
32    directors may determine  provided  notice  is  given  to  the
33    Commissioner prior to the resale of such stock.
34        (7)  During the time that a state bank shall continue its
 
HB2538 Engrossed            -36-               LRB9201093JScs
 1    banking  business,  it  shall  not  withdraw  or permit to be
 2    withdrawn, either in the form of dividends or otherwise,  any
 3    portion  of its capital, but nothing in this subsection shall
 4    prevent a reduction or change of the  capital  stock  or  the
 5    preferred  stock  under the provisions of Sections 17 through
 6    30 of this Act,  a  purchase  of  treasury  stock  under  the
 7    provisions  of  subsection  (6)  of  this  Section  14  or  a
 8    redemption  of preferred stock pursuant to charter provisions
 9    therefor.
10        (8)  (a)  Subject to the  provisions  of  this  Act,  the
11        board  of directors of a state bank from time to time may
12        declare a dividend of so much of the net profits of  such
13        bank  as  it  shall judge expedient, but each bank before
14        the declaration  of  a  dividend  shall  carry  at  least
15        one-tenth  of  its  net  profits  since  the  date of the
16        declaration of the last preceding dividend, or since  the
17        issuance  of  its  charter  in  the  case  of  its  first
18        dividend, to its surplus until the same shall be equal to
19        its capital.
20             (b)  No  dividends  shall  be  paid  by a state bank
21        while it continues its  banking  business  to  an  amount
22        greater  than  its  net  profits  then on hand, deducting
23        first therefrom its losses and bad debts.  All debts  due
24        to  a state bank on which interest is past due and unpaid
25        for a period of 6 months or more,  unless  the  same  are
26        well  secured  and in the process of collection, shall be
27        considered bad debts.
28        (9)  A State bank may, but shall not be obliged to, issue
29    a certificate for a fractional share, and, by action  of  its
30    board  of  directors,  may in lieu thereof, pay cash equal to
31    the value of the  fractional  share.   A  certificate  for  a
32    fractional   share  shall  entitle  the  holder  to  exercise
33    fractional  voting  rights,  to  receive  dividends,  and  to
34    participate in any of the assets of the bank in the event  of
 
HB2538 Engrossed            -37-               LRB9201093JScs
 1    liquidation.
 2    (Source:  P.A.  90-160,  eff.  7-23-97;  90-301, eff. 8-1-97;
 3    90-655, eff. 7-30-98.)

 4        (205 ILCS 5/15) (from Ch. 17, par. 322)
 5        Sec.  15.   Stock  and  stockholders.   Unless  otherwise
 6    provided for in this Act, provisions of  general  application
 7    to  capital  stock,  preferred  stock,  and stockholders of a
 8    State bank shall be as follows:
 9        (1)  There shall be an annual meeting of the stockholders
10    for the election of directors each year on the first business
11    day in January, unless some other date shall be fixed by  the
12    by-laws.  A special meeting of the stockholders may be called
13    at  any  time by the board of directors, and otherwise as may
14    be provided in the bylaws.
15        (2)  Written or printed notice stating  the  place,  day,
16    and  hour  of  the meeting, and in case of a special meeting,
17    the purpose or purposes for  which  the  meeting  is  called,
18    shall  be  delivered  not  less than 10 nor more than 40 days
19    before the date of the meeting either personally or by  mail,
20    by or at the direction of the president, or the secretary, or
21    the   officer   or  persons  calling  the  meeting,  to  each
22    stockholder of record entitled to vote at  the  meeting.   If
23    mailed,  the  notice  shall  be  deemed  to be delivered when
24    deposited in the United  States  mail  with  postage  thereon
25    prepaid  addressed  to  the  stockholder at his address as it
26    appears on the records of the bank.
27        (3)  Except as provided below in this paragraph (3), each
28    outstanding share shall be  entitled  to  one  vote  on  each
29    matter  submitted  to  a  vote  at a meeting of stockholders.
30    Shares of its own stock belonging to  a  bank  shall  not  be
31    voted,  directly  or indirectly, at any meeting and shall not
32    be counted in determining the  total  number  of  outstanding
33    shares at any given time, but shares of its own stock held by
 
HB2538 Engrossed            -38-               LRB9201093JScs
 1    it  in a fiduciary capacity may be voted and shall be counted
 2    in determining the total number of outstanding shares at  any
 3    given  time.   A  stockholder may vote either in person or by
 4    proxy executed in writing by the stockholder or by  his  duly
 5    authorized  attorney-in-fact.   No proxy shall be valid after
 6    11 months from the date of its  execution,  unless  otherwise
 7    provided  in  the  proxy.   Except  as provided below in this
 8    paragraph  (3),  in  all  elections   for   directors   every
 9    stockholder (or subscriber to the stock prior to the issuance
10    of  a  charter) shall have the right to vote, in person or by
11    proxy, for the number of shares of stock owned by him, for as
12    many persons as there are directors  to  be  elected,  or  to
13    cumulate  the  shares and give one candidate as many votes as
14    the number of directors multiplied by the number  of  his  or
15    her shares of stock shall equal, or to distribute them on the
16    same  principle  among  as many candidates as he or she shall
17    think fit.  The bank charter of  any  bank  organized  on  or
18    after  January  1,  1984  may  limit  or eliminate cumulative
19    voting rights in  all  or  specified  circumstances,  or  may
20    eliminate  voting rights entirely, as to any class or classes
21    or series of stock of the bank; provided that  one  class  of
22    shares  or  series thereof shall always have voting rights in
23    respect of all matters in the bank. A bank organized prior to
24    January 1, 1984 may amend its charter to eliminate cumulative
25    voting rights under all or  specified  circumstances,  or  to
26    eliminate  voting rights entirely, as to any class or classes
27    or series of stock of the bank; provided that  one  class  of
28    shares  or  series thereof shall always have voting rights in
29    respect of all matters in the bank, and provided further that
30    the proposal to eliminate  the  voting  rights  receives  the
31    approval  of  the holders of 70% of the outstanding shares of
32    stock entitled to vote as provided in  paragraph (b)  (7)  of
33    Section  17. A majority of the outstanding shares represented
34    in person or by proxy shall constitute a quorum at a  meeting
 
HB2538 Engrossed            -39-               LRB9201093JScs
 1    of stockholders.  In the absence of a quorum a meeting may be
 2    adjourned   from   time   to   time  without  notice  to  the
 3    stockholders.
 4        (4)  Whenever additional stock of a class is offered  for
 5    sale, stockholders of record of the same class on the date of
 6    the offer shall have the right to subscribe to the proportion
 7    of the shares as the stock of the class held by them bears to
 8    the  total  of  the  outstanding  stock of the class, and the
 9    price thereof may be in excess  of  par  value.   This  right
10    shall  be  transferable  but shall terminate if not exercised
11    within 60 days of the offer, unless  the  Commissioner  shall
12    authorize a shorter time.  If the right is not exercised, the
13    stock  shall  not be re-offered for sale to others at a lower
14    price without the stockholders of the same class again  being
15    accorded a preemptive right to subscribe at the lower price.
16    Notwithstanding  any  of the provisions of this paragraph (4)
17    or any other provision of law, stockholders  shall  not  have
18    any preemptive or other right to subscribe for or to purchase
19    or  acquire  shares  of  capital stock issued or to be issued
20    under a stock-option plan or  upon  conversion  of  preferred
21    stock   or   convertible   debentures  or  other  convertible
22    indebtedness that has been approved by  stockholders  in  the
23    manner  required  by  the  provisions  of  subsection  (5) of
24    Section 14 hereof or to treasury stock acquired  pursuant  to
25    subsection (6) of Section 14.
26        (5)  For the purpose of determining stockholders entitled
27    to  notice  of  or to vote at any meeting of stockholders, or
28    stockholders entitled to receive payment of any dividend,  or
29    in  order  to  make  a  determination of stockholders for any
30    other proper purpose, the board of directors of  a  bank  may
31    provide  that  the stock transfer books shall be closed for a
32    stated period not to exceed, in any case, 40 days.   In  lieu
33    of  closing  the stock transfer books, the board of directors
34    may fix in  advance  a  date  as  the  record  date  for  any
 
HB2538 Engrossed            -40-               LRB9201093JScs
 1    determination of stockholders, the date in any case to be not
 2    more  than 40 days, and in case of a meeting of stockholders,
 3    not less than  10  days  prior  to  the  date  on  which  the
 4    particular    action,    requiring   the   determination   of
 5    stockholders, is to be taken.  If the  stock  transfer  books
 6    are   not  closed  and  no  record  date  is  fixed  for  the
 7    determination of stockholders entitled to  notice  of  or  to
 8    vote  at  a meeting of stockholders, or stockholders entitled
 9    to receive payment of a dividend, the date on which notice of
10    a meeting is mailed or the date on which  the  resolution  of
11    the  board of directors declaring the dividend is adopted, as
12    the  case  may  be,  shall  be  the  record  date   for   the
13    determination of stockholders.
14        (6)  Stock  standing  in the name of another corporation,
15    domestic or foreign, may be voted by the officer,  agent,  or
16    proxy as the by-laws of the corporation may prescribe, or, in
17    the  absence  of such provision, as the board of directors of
18    the corporation may determine.  Stock standing in the name of
19    a deceased person may be voted by his or her administrator or
20    executor, either in person or by proxy.   Stock  standing  in
21    the  name  of  a  guardian  or  trustee  may be voted by that
22    fiduciary either in person or by proxy.  Shares  standing  in
23    the  name  of  a  receiver  may be voted by the receiver, and
24    shares held by or under control of a receiver may be voted by
25    the receiver without the transfer thereof  into  his  or  her
26    name  if  authority  so  to do be contained in an appropriate
27    order of the court by which the receiver  was  appointed.   A
28    stockholder  whose  shares  of  stock  are  pledged  shall be
29    entitled to vote those shares  until  the  shares  have  been
30    transferred  into the name of the pledgee, and thereafter the
31    pledgee shall be entitled to vote the shares so transferred.
32        (7)  Shares of stock shall be transferable in  accordance
33    with the general laws of this State governing the transfer of
34    corporate shares.
 
HB2538 Engrossed            -41-               LRB9201093JScs
 1        (8)  The  president and cashier of every State bank shall
 2    cause to be kept at all times a full and correct list of  the
 3    names  and  residences  of  all the shareholders in the State
 4    bank and the number of shares held  by  each  in  the  office
 5    where  its business is transacted.  The list shall be subject
 6    to the inspection of all the shareholders of the  State  bank
 7    and  the  officers  authorized  to  assess  taxes under State
 8    authority during business hours of each day in which business
 9    may be legally transacted.  A copy of the list,  verified  by
10    the oath of the president or cashier, shall be transmitted to
11    the  Commissioner  of Banks and Real Estate within 10 days of
12    any demand therefor made by the Commissioner.
13        (9)  Any number of shareholders of a bank  may  create  a
14    voting  trust for the purpose of conferring upon a trustee or
15    trustees the right  to  vote  or  otherwise  represent  their
16    shares  for  a  period  of not to exceed 10 years by entering
17    into a written voting trust  agreement specifying  the  terms
18    and  conditions of the voting trust and by transferring their
19    shares to the trustee or trustees for  the  purposes  of  the
20    agreement.   The  trust  agreement shall not become effective
21    until a counterpart of the agreement is  deposited  with  the
22    bank  at  its  main  banking premises registered office.  The
23    counterpart of the voting trust agreement so  deposited  with
24    the bank shall be subject to the same right of examination by
25    a shareholder of the bank, in person or by agent or attorney,
26    as  is  the  record  of shareholders of the bank and shall be
27    subject to examination by any holder of a beneficial interest
28    in the  voting  trust,  either  in  person  or  by  agent  or
29    attorney, at any reasonable time for any proper purpose.
30        (10)  Voting  agreements.   Shareholders  may provide for
31    the voting of their shares by signing an agreement  for  that
32    purpose.   A voting agreement created under this paragraph is
33    not subject to the provisions of paragraph (9).
34        A  voting  agreement  created  under  this  paragraph  is
 
HB2538 Engrossed            -42-               LRB9201093JScs
 1    specifically enforceable in accordance with the principles of
 2    equity.
 3    (Source: P.A. 89-508, eff. 7-3-96.)

 4        (205 ILCS 5/16.1) (from Ch. 17, par. 323.1)
 5        Sec. 16.1.  One or more of the directors may be  removed,
 6    with  or  without  cause, at a meeting of shareholders by the
 7    affirmative  vote  of  the  holders  of  a  majority  of  the
 8    outstanding shares then entitled to vote at  an  election  of
 9    directors, except as follows:
10        (1)  No  director  shall  be  removed  at  a  meeting  of
11    shareholders  unless  the  notice  of the meeting shall state
12    that a purpose of the meeting is to vote upon the removal  of
13    one  or  more  directors named in the notice.  Only the named
14    director or directors may be removed at that meeting.
15        (2)  In the case of a bank having cumulative  voting,  if
16    less  than the entire board is to be removed, no director may
17    be removed if the votes cast against his or her removal would
18    be sufficient to elect him or her if then cumulatively  voted
19    at an election of the entire board of directors.
20        (3)  If  a  director  is  elected by a class or series of
21    shares, he or she may be removed only by the shareholders  of
22    that class or series.
23        (4)  In   the  case  of  a  State  bank  whose  board  is
24    classified as provided in paragraph (3) (5) of Section 16  of
25    this  Act,  the  charter  or  the  by-laws  may  provide that
26    directors may be removed only for cause.
27    (Source: P.A. 86-368; 87-269.)

28        (205 ILCS 5/17) (from Ch. 17, par. 324)
29        Sec. 17.  Changes in charter.
30        (a)  By compliance with the  provisions  of  this  Act  a
31    State bank may:
32             (1)  (blank);
 
HB2538 Engrossed            -43-               LRB9201093JScs
 1             (2)  increase, decrease or change its capital stock,
 2        whether  issued  or  unissued,  provided  that in no case
 3        shall the capital be diminished to the prejudice  of  its
 4        creditors;
 5             (3)  provide  for  authorized  but  unissued capital
 6        stock reserved for  issuance  for  one  or  more  of  the
 7        purposes  provided  for  in  subsection (5) of Section 14
 8        hereof;
 9             (4)  authorize   preferred   stock,   or   increase,
10        decrease  or  change  the  preferences,   qualifications,
11        limitations,  restrictions  or special or relative rights
12        of its  preferred  stock,  whether  issued  or  unissued,
13        provided  that in no case shall the capital be diminished
14        to the prejudice of its creditors;
15             (5)  increase, decrease or change the par  value  of
16        its  shares  of  its  capital  stock  or preferred stock,
17        whether issued or unissued;
18             (6)  (blank) extend the duration of its charter;
19             (7)  eliminate cumulative voting rights under all or
20        specified  circumstances,  or  eliminate  voting   rights
21        entirely,  as  to any class or classes or series of stock
22        of the bank pursuant to  paragraph  (3)  of  Section  15,
23        provided that one class of shares or series thereof shall
24        always have voting in respect to all matters in the bank,
25        and  provided further that the proposal to eliminate such
26        voting rights receives the approval of the holders of 70%
27        of the outstanding shares of stock entitled  to  vote  as
28        provided  in  paragraph  (7)  of  subsection  (b) of this
29        Section 17;
30             (8)  increase, decrease, or change its capital stock
31        or preferred stock, whether issued or unissued,  for  the
32        purpose  of eliminating fractional shares or avoiding the
33        issuance of fractional shares, provided that in  no  case
34        shall  the  capital be diminished to the prejudice of its
 
HB2538 Engrossed            -44-               LRB9201093JScs
 1        creditors; or
 2             (9)  make such other change in its charter as may be
 3        authorized in this Act.
 4        (b)  To effect a change or  changes  in  a  State  bank's
 5    charter as provided for in this Section 17:
 6             (1)  The board of directors shall adopt a resolution
 7        setting  forth  the proposed amendment and directing that
 8        it be submitted to a vote at a meeting  of  stockholders,
 9        which may be either an annual or special meeting.
10             (2)  If the meeting is a special meeting, written or
11        printed  notice  setting  forth the proposed amendment or
12        summary thereof shall be given  to  each  stockholder  of
13        record  entitled to vote at such meeting at least 30 days
14        before such meeting and in the manner  provided  in  this
15        Act for the giving of notice of meetings of stockholders.
16             (3)  At   such   special  meeting,  a  vote  of  the
17        stockholders entitled to  vote  shall  be  taken  on  the
18        proposed  amendment.  Except as provided in paragraph (7)
19        of this subsection (b), the proposed amendment  shall  be
20        adopted  upon  receiving  the  affirmative  vote  of  the
21        holders  of at least two-thirds of the outstanding shares
22        of stock entitled to vote at such meeting, unless holders
23        of preferred stock are entitled to vote  as  a  class  in
24        respect  thereof,  in  which event the proposed amendment
25        shall be adopted upon receiving the affirmative  vote  of
26        the  holders  of  at  least two-thirds of the outstanding
27        shares of each class of shares  entitled  to  vote  as  a
28        class  in  respect  thereof  and of the total outstanding
29        shares entitled to vote at such meeting.  Any  number  of
30        amendments may be submitted to the stockholders and voted
31        upon  by  them  at  one  meeting.   A  certificate of the
32        amendment, or amendments, verified by the president, or a
33        vice-president,  or   the   cashier,   shall   be   filed
34        immediately in the office of the Commissioner.
 
HB2538 Engrossed            -45-               LRB9201093JScs
 1             (4)  At  any  annual meeting without a resolution of
 2        the board of directors and without  a  notice  and  prior
 3        publication, as hereinabove provided, a proposition for a
 4        change  in  the  bank's  charter  as provided for in this
 5        Section 17 may be submitted to a vote of the stockholders
 6        entitled to vote at the annual meeting,  except  that  no
 7        proposition  for  authorized  but  unissued capital stock
 8        reserved for issuance for one or  more  of  the  purposes
 9        provided for in subsection (5) of Section 14 hereof shall
10        be  submitted  without  complying  with the provisions of
11        said subsection.  The proposed amendment shall be adopted
12        upon receiving the affirmative vote of the holders of  at
13        least  two-thirds  of  the  outstanding  shares  of stock
14        entitled to vote  at  such  meeting,  unless  holders  of
15        preferred  stock  are  entitled  to  vote  as  a class in
16        respect thereof, in which event  the  proposed  amendment
17        shall  be  adopted upon receiving the affirmative vote of
18        the holders of at least  two-thirds  of  the  outstanding
19        shares  of  each  class  of  shares entitled to vote as a
20        class in respect thereof and the total outstanding shares
21        entitled to vote at such meeting.  A certificate  of  the
22        amendment, or amendments, verified by the president, or a
23        vice-president  or cashier, shall be filed immediately in
24        the office of the Commissioner.
25             (5)  If an amendment or amendments shall be approved
26        in  writing  by  the  Commissioner,  the   amendment   or
27        amendments   so   adopted   and   so  approved  shall  be
28        accomplished  in  accordance  with  the   vote   of   the
29        stockholders.  The Commissioner may impose such terms and
30        conditions on the approval of the amendment or amendments
31        as  he  deems necessary or appropriate.  The Commissioner
32        shall revoke such approval in the event such amendment or
33        amendments are not effected within one year from the date
34        of the issuance of  the  Commissioner's  certificate  and
 
HB2538 Engrossed            -46-               LRB9201093JScs
 1        written  approval except for transactions permitted under
 2        subsection (5) of Section 14 of this Act.
 3             (6)  No amendment or amendments shall  affect  suits
 4        in  which  the  bank  is  a  party,  nor affect causes of
 5        action, nor affect rights of persons in  any  particular,
 6        nor shall actions brought against such bank by its former
 7        name be abated by a change of name.
 8             (7)  A  proposal  to  amend the charter to eliminate
 9        cumulative  voting  rights   under   all   or   specified
10        circumstances, or to eliminate voting rights entirely, as
11        to  any  class  or  classes or series or stock of a bank,
12        pursuant to paragraph (3) of Section 15 and paragraph (7)
13        of subsection (a) of this Section 17,  shall  be  adopted
14        only  upon  such  proposal  receiving the approval of the
15        holders  of  70%  of  the  outstanding  shares  of  stock
16        entitled to vote at the meeting  where  the  proposal  is
17        presented for approval, unless holders of preferred stock
18        are  entitled  to  vote as a class in respect thereof, in
19        which event the proposed amendment shall be adopted  upon
20        receiving  the  approval  of  the  holders  of 70% of the
21        outstanding shares of each class of  shares  entitled  to
22        vote  as  a  class  in  respect  thereof and of the total
23        outstanding shares entitled to vote at the meeting  where
24        the  proposal is presented for approval.  The proposal to
25        amend the charter pursuant to this paragraph (7)  may  be
26        voted upon at the annual meeting or a special meeting.
27             (8)  Written  or  printed  notice of a stockholders'
28        meeting to vote on a proposal to  increase,  decrease  or
29        change  the  capital stock or preferred stock pursuant to
30        paragraph (8) of subsection (a) of this Section 17 and to
31        eliminate fractional shares  or  avoid  the  issuance  of
32        fractional  shares  shall be given to each stockholder of
33        record entitled to vote at the meeting at least  30  days
34        before the meeting and in the manner provided in this Act
 
HB2538 Engrossed            -47-               LRB9201093JScs
 1        for the giving of notice of meetings of stockholders, and
 2        shall include all of the following information:
 3                  (A)  A statement of the purpose of the proposed
 4             reverse stock split.
 5                  (B)  A statement of the amount of consideration
 6             being offered for the bank's stock.
 7                  (C)  A  statement  that  the bank considers the
 8             transaction  fair  to  the   stockholders,   and   a
 9             statement  of  the  material  facts  upon which this
10             belief is based.
11                  (D)  A statement that the bank has  secured  an
12             opinion  from  a  third  party  with  respect to the
13             fairness, from a financial point  of  view,  of  the
14             consideration   to   be   paid,   the  identity  and
15             qualifications of the third  party,  how  the  third
16             party  was  selected,  and any material relationship
17             between the third party and the bank.
18                  (E)  A summary of  the  opinion  including  the
19             basis  for  and  the  methods  of  arriving  at  the
20             findings  and  any limitation imposed by the bank in
21             arriving at fair value and a  statement  making  the
22             opinion  available  for  reviewing or copying by any
23             stockholder.
24                  (F)  A statement  that  objecting  stockholders
25             will  be  entitled to the fair value of those shares
26             that are voted against the charter amendment,  if  a
27             proper   demand   is   made  on  the  bank  and  the
28             requirements are  satisfied  as  specified  in  this
29             Section.
30    If a stockholder shall file with the bank, prior to or at the
31    meeting   of  stockholders  at  which  the  proposed  charter
32    amendment is submitted to a vote, a written objection to  the
33    proposed  charter  amendment  and  shall  not  vote  in favor
34    thereof,  and  if  the  stockholder,  within  20  days  after
 
HB2538 Engrossed            -48-               LRB9201093JScs
 1    receiving written notice of the date  the  charter  amendment
 2    was  accomplished pursuant to paragraph (5) of subsection (a)
 3    of this Section 17, shall make written demand on the bank for
 4    payment of the fair value of the stockholder's shares  as  of
 5    the  day  prior  to  the  date  on  which  the vote was taken
 6    approving the charter amendment, the bank shall  pay  to  the
 7    stockholder,   upon   surrender   of   the   certificate   or
 8    certificates  representing the stock, the fair value thereof.
 9    The demand shall state the number  of  shares  owned  by  the
10    objecting stockholder.  The bank shall provide written notice
11    of  the  date on which the charter amendment was accomplished
12    to all stockholders who  have  filed  written  objections  in
13    order that the objecting stockholders may know when they must
14    file written demand if they choose to do so.  Any stockholder
15    failing  to  make  demand  within  the 20-day period shall be
16    conclusively  presumed  to  have  consented  to  the  charter
17    amendment and shall be bound by the terms thereof.  If within
18    30 days after the date  on  which  a  charter  amendment  was
19    accomplished  the  value of the shares is agreed upon between
20    the objecting stockholders and  the  bank,  payment  therefor
21    shall  be  made  within  90  days after the date on which the
22    charter amendment was accomplished, upon the surrender of the
23    stockholder's certificate or  certificates  representing  the
24    shares.  Upon  payment  of  the  agreed  value  the objecting
25    stockholder shall cease to have any interest in the shares or
26    in  the  bank.   If  within  such  period  of  30  days   the
27    stockholder  and the bank do not so agree, then the objecting
28    stockholder may, within 60 days after the expiration  of  the
29    30-day  period,  file a complaint in the circuit court asking
30    for a finding and determination of  the  fair  value  of  the
31    shares,  and  shall  be entitled to judgment against the bank
32    for the amount of the fair value as of the day prior  to  the
33    date  on  which  the  vote  was  taken  approving the charter
34    amendment with interest thereon to the date of the  judgment.
 
HB2538 Engrossed            -49-               LRB9201093JScs
 1    The practice, procedure and judgment shall be governed by the
 2    Civil Practice Law.   The judgment shall be payable only upon
 3    and  simultaneously  with  the  surrender  to the bank of the
 4    certificate or certificates representing  the  shares.   Upon
 5    payment  of  the  judgment,  the  objecting stockholder shall
 6    cease to have any interest in the shares or  the  bank.   The
 7    shares  may  be held and disposed of by the bank.  Unless the
 8    objecting stockholder shall file such  complaint  within  the
 9    time herein limited, the stockholder and all persons claiming
10    under  the stockholder shall be conclusively presumed to have
11    approved and ratified the charter  amendment,  and  shall  be
12    bound  by  the  terms  thereof.    The  right of an objecting
13    stockholder to be paid the fair value  of  the  stockholder's
14    shares  of  stock  as herein provided shall cease if and when
15    the bank shall abandon the charter amendment.
16        (c)  The  purchase  and  holding  and  later  resale   of
17    treasury  stock of a state bank pursuant to the provisions of
18    subsection (6) of Section 14 may be  accomplished  without  a
19    change  in its charter reflecting any decrease or increase in
20    capital stock.
21    (Source: P.A. 90-160,  eff.  7-23-97;  90-301,  eff.  8-1-97;
22    90-655, eff. 7-30-98; 91-322, eff. 1-1-00.)

23        (205 ILCS 5/18) (from Ch. 17, par. 325)
24        Sec. 18.  Change in control.
25        (a)  Before  a  change  may  occur  in  the  ownership of
26    outstanding stock of any State  bank,  whether  by  sale  and
27    purchase,  gift,  bequest or inheritance, or any other means,
28    including the acquisition of stock of the State bank  by  any
29    bank  holding  company,   which  will  result in control or a
30    change in the control of the bank or before a change  in  the
31    control   of   a   holding  company  having  control  of  the
32    outstanding stock  of  a  State  bank  whether  by  sale  and
33    purchase,  gift,  bequest or inheritance, or any other means,
 
HB2538 Engrossed            -50-               LRB9201093JScs
 1    including the acquisition of stock of such holding company by
 2    any other bank holding company, which will result in  control
 3    or  a  change  in  control of the bank or holding company, or
 4    before  a  transfer  of  substantially  all  the  assets   or
 5    liabilities  of  the State bank, the Commissioner shall be of
 6    the opinion and find:
 7             (1)  that the  general  character  of  its  proposed
 8        management   or   of  the  person  desiring  to  purchase
 9        substantially all the assets or to  assume  substantially
10        all  the  liabilities of the State bank, after the change
11        in control, is such as to assure  reasonable  promise  of
12        successful, safe and sound operation;
13             (1.1)  that   depositors'   interests  will  not  be
14        jeopardized  by  the  purchase  or  assumption  and  that
15        adequate provision has been made for all  liabilities  as
16        required  for a voluntary liquidation under Section 68 of
17        this Act;
18             (2)  that  the  future  earnings  prospects  of  the
19        person desiring to purchase substantially all  assets  or
20        to  assume substantially all the liabilities of the State
21        bank,  after  the  proposed  change   in   control,   are
22        favorable;
23             (3)  that  any  prior  involvement  by  the  persons
24        proposing  to  obtain  control, to purchase substantially
25        all the  assets,  or  to  assume  substantially  all  the
26        liabilities   of  the  State  bank  or  by  the  proposed
27        management   personnel   with   any    other    financial
28        institution, whether as stockholder, director, officer or
29        customer, was conducted in a safe and sound manner; and
30             (4)  that if the acquisition is being made by a bank
31        holding  company, the acquisition is authorized under the
32        Illinois Bank Holding Company Act of 1957.
33        (b)  Persons desiring to purchase control of an  existing
34    state  bank,  to purchase substantially all the assets, or to
 
HB2538 Engrossed            -51-               LRB9201093JScs
 1    assume substantially all the liabilities of  the  State  bank
 2    shall, prior to that purchase, submit to the Commissioner:
 3             (1)  a statement of financial worth;
 4             (2)  satisfactory    evidence    that    any   prior
 5        involvement by the persons and  the  proposed  management
 6        personnel  with  any other financial institution, whether
 7        as  stockholder,  director,  officer  or  customer,   was
 8        conducted in a safe and sound manner; and
 9             (3)  such   other   relevant   information   as  the
10        Commissioner may request  to  substantiate  the  findings
11        under subsection (a) of this Section.
12        A   person   who   has   submitted   information  to  the
13    Commissioner pursuant to  this  subsection  (b)  is  under  a
14    continuing  obligation until the Commissioner takes action on
15    the application to immediately supplement that information if
16    there are any material changes in the information  previously
17    furnished  or  if  there  are  any  material  changes  in any
18    circumstances that may affect the Commissioner's opinion  and
19    findings.  In addition, a person submitting information under
20    this  subsection  shall  notify  the Commissioner of the date
21    when the change in control is finally effected.
22        The Commissioner may impose such terms and conditions  on
23    the approval of the change in control application as he deems
24    necessary or appropriate.
25        If  an  applicant,  whose  application  for  a  change in
26    control has been approved pursuant to subsection (a) of  this
27    Section,  fails  to  effect  the change in control within 180
28    days after the  date  of  the  Commissioner's  approval,  the
29    Commissioner  shall revoke that approval unless a request has
30    been submitted,  in  writing,  to  the  Commissioner  for  an
31    extension and the request has been approved.
32        As  used  in  this  Section, the term "control" means the
33    ownership of such amount of stock or ability  to  direct  the
34    voting  of  such  stock  as  to  give  power  to, directly or
 
HB2538 Engrossed            -52-               LRB9201093JScs
 1    indirectly, direct or cause the direction of  the  management
 2    or  policies  of  the  bank.   A change in ownership of stock
 3    which would result in  direct  or  indirect  ownership  by  a
 4    stockholder, an affiliated group of stockholders or a holding
 5    company  of  less  than  10  percent of the outstanding stock
 6    shall not be considered a change of  control.   A  change  in
 7    ownership  of  stock which would result in direct or indirect
 8    ownership  by  a  stockholder,   an   affiliated   group   of
 9    stockholders  or  a  holding  company  of  20 percent or such
10    lesser amount which would  entitle  the  holder  by  applying
11    cumulative  voting to elect one director shall be presumed to
12    constitute a change of control for purposes of  this  Section
13    18.   If  there  is  any  doubt as to whether a change in the
14    ownership or control of the outstanding stock  is  sufficient
15    to  result in obtaining control thereof or to effect a change
16    in the control thereof, such doubt shall be resolved in favor
17    of reporting the facts to the Commissioner.
18        As used in this Section, "substantially all"  the  assets
19    or  liabilities  of  a  State  bank means that portion of the
20    assets or  liabilities  of  a  State  bank  such  that  their
21    purchase  or  transfer  will materially impair the ability of
22    the State  bank  to  continue  successful,  safe,  and  sound
23    operations  or  to continue as a going concern or would cause
24    the bank to lose its federal deposit insurance.
25        (b-1)  Any person who obtains ownership of  stock  of  an
26    existing  State  bank  or  stock  of  a  holding company that
27    controls the State bank by gift, bequest, or inheritance such
28    that ownership of the stock would constitute control  of  the
29    State  bank or holding company may obtain title and ownership
30    of the stock, but may not exercise management or  control  of
31    the  business  and  affairs  of  the  bank or vote his or her
32    shares so as to exercise management  or  control  unless  and
33    until the Commissioner approves an application for the change
34    of control as provided in subsection (b) of this Section.
 
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 1        (c)  Whenever  a  state  bank  makes  a  loan  or  loans,
 2    secured,  or to be secured, by 25% or more of the outstanding
 3    stock of a state bank, the president or other chief executive
 4    officer of the lending bank shall promptly report  such  fact
 5    to  the Commissioner upon obtaining knowledge of such loan or
 6    loans, except that no report need  be  made  in  those  cases
 7    where  the borrower has been the owner of record of the stock
 8    for a period of one year or more, or the stock is that  of  a
 9    newly organized bank prior to its opening.
10        (d)  The  reports  required by subsections (b) and (c) of
11    this Section 18, other than those relating to a  transfer  of
12    assets  or  assumption  of  liabilities,  shall  contain  the
13    following  information  to the extent that it is known by the
14    person making the report: (1) the number of shares  involved;
15    (2)  the names of the sellers (or transferors); (3) the names
16    of the purchasers (or transferees);  (4)  the  names  of  the
17    beneficial  owners  if  the  shares are registered in another
18    name: (5) the purchase price, if applicable;  (6)  the  total
19    number  of  shares owned by the sellers (or transferors), the
20    purchasers (or transferees) and the  beneficial  owners  both
21    immediately before and after the transaction; and, (7) in the
22    case  of  a loan, the name of the borrower, the amount of the
23    loan, the name of the bank issuing  the  stock  securing  the
24    loan and the number of shares securing the loan.  In addition
25    to  the  foregoing,  such  reports  shall  contain such other
26    information which is requested by the Commissioner to  inform
27    the  Commissioner  of  the  effect  of  the  transaction upon
28    control of the bank whose stock is involved.
29        (d-1)  The reports required by  subsection  (b)  of  this
30    Section  18  that relate to purchase of assets and assumption
31    of liabilities shall contain the following information to the
32    extent that it is known by the person making the report:  (1)
33    the value, amount, and description of the assets transferred;
34    (2) the amount, type, and to whom each  type  of  liabilities
 
HB2538 Engrossed            -54-               LRB9201093JScs
 1    are  owed;  (3) the names of the purchasers (or transferees);
 2    (4) the names of the beneficial owners if  the  shares  of  a
 3    purchaser  or  transferee are registered in another name; (5)
 4    the purchase price, if applicable; and, (6) in the case of  a
 5    loan obtained to effect a purchase, the name of the borrower,
 6    the  amount and terms of the loan, and the description of the
 7    assets securing the loan.   In  addition  to  the  foregoing,
 8    these  reports  shall  contain  any other information that is
 9    requested by the Commissioner to inform the  Commissioner  of
10    the effect of the transaction upon the bank from which assets
11    are purchased or liabilities are transferred.
12        (e)  Whenever  such  a  change as described in subsection
13    (a) of this Section 18 occurs, each state bank  shall  report
14    promptly  to  the  Commissioner any changes or replacement of
15    its chief executive officer or of any director  occurring  in
16    the next 12 month period, including in its report a statement
17    of   the   past   and   current   business  and  professional
18    affiliations of the new chief executive officer or directors.
19        (f)  (Blank).
20        (g) (1)  Except as otherwise expressly provided  in  this
21        subsection  (g),  the  Commissioners shall not approve an
22        application for a change in control if upon  consummation
23        of  the  change  in  control the persons applying for the
24        change  in  control,  including  any  affiliates  of  the
25        persons applying, would control 30% or more of the  total
26        amount  of  deposits  which  are located in this State at
27        insured depository institutions.  For  purposes  of  this
28        subsection    (g),    the   words   "insured   depository
29        institution" shall mean State banks, national banks,  and
30        insured   savings  associations.  For  purposes  of  this
31        subsection  (g),  the  word  "deposits"  shall  have  the
32        meaning ascribed to that word  in  Section  3(1)  of  the
33        Federal  Deposit  Insurance  Act.  For  purposes  of this
34        subsection (g), the total amount of  deposits  which  are
 
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 1        considered  to  be  located  in  this  State  at  insured
 2        depository  institutions  shall  equal  the  sum  of  all
 3        deposits  held  at the main banking premises and branches
 4        in the State of Illinois of State banks, national  banks,
 5        or  insured  savings  associations.  For purposes of this
 6        subsection (g), the  word  "affiliates"  shall  have  the
 7        meaning  ascribed  to  that  word in Section 35.2 of this
 8        Act.
 9             (2)  Notwithstanding the  provisions  of  subsection
10        (g)(1)  of  this Section, the Commissioner may approve an
11        application for a change in control for a bank that is in
12        default  or  in  danger  of  default.  Except  in   those
13        instances in which an application for a change in control
14        is for a bank that is in default or in danger of default,
15        the  Commissioner  may  not  approve  a change in control
16        which does not meet the requirements of subsection (g)(1)
17        of this Section.  The  Commissioner  may  not  waive  the
18        provisions  of subsection (g)(1) of this Section, whether
19        pursuant to Section 3(d)  of  the  federal  Bank  Holding
20        Company  Act  of  1956  or  Section  44(d) of the Federal
21        Deposit Insurance Act, except as  expressly  provided  in
22        this subsection (g)(2).
23        (h)  As  used  in  this Section, the term "control" means
24    the  ownership  of such amount of stock or ability to  direct
25    the  voting of such stock as to, directly or indirectly, give
26    power to direct or cause the direction of the  management  or
27    policies  of  the bank.  A change in ownership of  stock that
28    would  result  in  direct  or   indirect   ownership   by   a
29    stockholder,  an  affiliated  group  of  stockholders,  or  a
30    holding  company of  less  than  10% of the outstanding stock
31    shall not be considered a change in  control.   A  change  in
32    ownership  of  stock  that would result in direct or indirect
33    ownership  by  a  stockholder,   an   affiliated   group   of
34    stockholders,  or  a  holding  company  of 20% or such lesser
 
HB2538 Engrossed            -56-               LRB9201093JScs
 1    amount that would entitle  the  holder by applying cumulative
 2    voting to elect one director shall be presumed to  constitute
 3    a  change  of  control  for  purposes of this Section 18.  If
 4    there is any question as to whether a change in the ownership
 5    or control of the outstanding stock is sufficient  to  result
 6    in  obtaining   control  thereof or to effect a change in the
 7    control thereof, the question shall be resolved in  favor  of
 8    reporting the facts to the Commissioner.
 9        As  used  in this Section, "substantially all" the assets
10    or liabilities of a State bank  means  that  portion  of  the
11    assets  or  liabilities  of  a  State  bank  such  that their
12    purchase or transfer will materially impair  the  ability  of
13    the  State  bank  to  continue  successful,  safe,  and sound
14    operations or to continue as a going concern or  would  cause
15    the bank to lose its federal deposit insurance.
16        As  used  in this Section, "purchase" includes a transfer
17    by gift, bequest, inheritance, or any other means.
18    (Source: P.A. 89-567, eff. 7-26-96; 90-226, eff. 7-25-97.)

19        (205 ILCS 5/22) (from Ch. 17, par. 329)
20        Sec. 22. Merger  procedure;  resulting  State  bank.  The
21    merger  procedure  required of a State bank where there is to
22    be a resulting State bank by consolidation  or  merger  shall
23    be:
24        (1)  The  board  of  directors  of  each  merging bank or
25    insured savings association  shall,  by  a  majority  of  the
26    entire board, approve a merger agreement that shall contain:
27             (a)  The  name  of  each  merging  bank  or  insured
28        savings  association  and its location and a list of each
29        merging   bank's   or   insured   savings   association's
30        stockholders as of the date of the merger agreement;
31             (b)  With respect to the resulting bank (i) its name
32        and place of business; (ii) the amount of Tier 1 capital,
33        surplus and reserve for  operating  expenses;  (iii)  the
 
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 1        classes  and  the  number  of shares of stock and the par
 2        value  of  each  share;  (iv)  the  designation  of   the
 3        continuing  bank  and  the  charter  which  is  to be the
 4        charter  of  the  resulting  bank,  together   with   the
 5        amendments   to   the   continuing  charter  and  to  the
 6        continuing  by-laws;  and  (v)   a   detailed   financial
 7        Statement  showing  the  assets and liabilities after the
 8        proposed merger or consolidation;
 9             (c)  Provisions  stating  the  method,   terms   and
10        conditions  of carrying the merger into effect, including
11        the manner of converting the shares of the merging  banks
12        or  insured  savings association into the cash, shares of
13        stock or other securities of  any  corporation  or  other
14        property,  or any combination of the foregoing, Stated in
15        the  merger  agreement  as  to   be   received   by   the
16        stockholders  of  each  merging  bank  or insured savings
17        association;
18             (d)  A Statement that the agreement  is  subject  to
19        approval  by  the Commissioner and by the stockholders of
20        each merging bank or insured savings association and that
21        whether approved or  disapproved  the  merging  banks  or
22        insured  savings  association will pay the Commissioner's
23        expenses of examination;
24             (e)  Provisions governing the manner of disposing of
25        the shares  of  the  resulting  bank  not  taken  by  the
26        dissenting  stockholders  of the merging banks or insured
27        savings association; and
28             (f)  Such other provisions as the  Commissioner  may
29        reasonably  require to enable him to discharge his duties
30        with respect to the merger.
31        (2)  After approval by the board  of  directors  of  each
32    bank  or  insured  savings  association, the merger agreement
33    shall be submitted to the Commissioner for approval, together
34    with certified copies of the authorizing resolutions of  each
 
HB2538 Engrossed            -58-               LRB9201093JScs
 1    board  of  directors  showing  approval  by a majority of the
 2    entire board of each bank or insured savings association.
 3        (3)  After receipt by  the  Commissioner  of  the  papers
 4    specified  in  paragraph  (2), he shall approve or disapprove
 5    the merger agreement. The Commissioner shall not approve  the
 6    merger  agreement unless he shall be of the opinion and shall
 7    find:
 8             (a)  That the resulting bank meets the  requirements
 9        of  this  Act  for  the  formation  of  a new bank at the
10        proposed main banking premises of the resulting bank;
11             (b)  That the same matters exist with respect to the
12        resulting bank  which  would  have  been  required  under
13        Section  10  of  this  Act  for the organization of a new
14        bank;
15             (c)  That  the  merger  agreement  is  fair  to  all
16        persons affected; and
17             (d)  That the resulting bank will be operated  in  a
18        safe and sound manner.
19        If  the  Commissioner  disapproves  an agreement he shall
20    State his objections and give an opportunity to  the  merging
21    banks   to   amend  the  merger  agreement  to  obviate  such
22    objections.
23        (4)  The  Commissioner  may   impose   such   terms   and
24    conditions  on  the  approval  of  the merger agreement as he
25    deems necessary or appropriate.
26        (5)  If the Commissioner approves a merger agreement,  he
27    may  revoke that approval if the merger has not been approved
28    by the shareholders in accordance with Section 23 within  180
29    days  after the date of the Commissioner's approval, unless a
30    request has been submitted, in writing, to  the  Commissioner
31    for an extension and the request has been approved.
32        (6)  The  board of directors of a bank or insured savings
33    association  is  under  a  continuing  obligation  until  the
34    Commissioner takes  action  on  the  application  to  furnish
 
HB2538 Engrossed            -59-               LRB9201093JScs
 1    additional  information  if there are any material changes in
 2    circumstances after the merger agreement has  been  submitted
 3    which may affect the Commissioner's opinions and findings.
 4    (Source: P.A. 87-1226.)

 5        (205 ILCS 5/25) (from Ch. 17, par. 332)
 6        Sec.  25.  Conversion of national bank or insured savings
 7    association into State  bank.  A  national  bank  or  insured
 8    savings  association  located in this State which follows the
 9    procedure prescribed by the laws of the United States  or  of
10    the  State  of  Illinois  to convert into a State bank may be
11    granted a charter by the Commissioner. The national  bank  or
12    insured  savings  association  may  apply for such charter by
13    filing with the Commissioner:
14        (1)  A  certificate  signed  by  its  president,   or   a
15    vice-president,  or  the  cashier,  and  by a majority of the
16    entire board of directors setting forth the corporate  action
17    taken  in  compliance  with the provisions of the laws of the
18    United States or of  the  State  of  Illinois  governing  the
19    conversion  of a national bank or insured savings association
20    to a State bank;
21        (2)  The plan of  conversion  and  the  proposed  charter
22    approved by the stockholders for the operation of the bank or
23    insured savings association as a State bank;
24        (3)  The name proposed for the converting bank or insured
25    savings   association,   its  location  and  a  list  of  its
26    stockholders as of the date of the stockholders' approval  of
27    the plan of conversion;
28        (4)  The  amount  of  its  Tier  1  capital,  surplus and
29    reserve for operation expenses, the classes and the number of
30    the shares of stock and the par value of each  share,  and  a
31    detailed  statement showing the assets and liabilities of the
32    converting bank or insured savings association; and
33        (5)  A statement that the plan of conversion  is  subject
 
HB2538 Engrossed            -60-               LRB9201093JScs
 1    to the approval of the Commissioner and that whether approved
 2    or   disapproved  the  converting  bank  or  insured  savings
 3    association  will  pay   the   Commissioner's   expenses   of
 4    examination.
 5        For  purposes of this Section, a national bank or insured
 6    savings association is located in the State  where  its  main
 7    banking premises or main office is located.
 8    (Source: P.A. 89-567, eff. 7-26-96.)

 9        (205 ILCS 5/30.5)
10        Sec.  30.5.  Mid-tier  bank  holding  company merger with
11    State bank.  Upon approval by the  Commissioner,  a  mid-tier
12    bank  holding  company  having  power  so to do under the law
13    under which it is organized may  merge  into  its  subsidiary
14    State  bank as prescribed by this Act; except that the action
15    by the mid-tier bank holding company shall be  taken  in  the
16    manner  prescribed by and shall be subject to limitations and
17    requirements imposed by the law under which it is  organized.
18    The merger procedure shall be as follows:
19        (1)  The  board  of  directors of the parent bank holding
20    company shall, by  resolution,  approve  a  merger  agreement
21    which shall contain:
22             (a)  the  name  and location of the merging bank and
23        of the mid-tier bank holding company;
24             (b)  with respect to the merging bank (i) the amount
25        of Tier 1 capital, surplus,  and  reserve  for  operating
26        expenses;  (ii)  the  classes and the number of shares of
27        stock and the par value of each share; (iii)  a  detailed
28        financial  statement  showing  the assets and liabilities
29        after the proposed merger; and (iv) any amendments to the
30        charter or by-laws;
31             (c)  provisions governing the manner  of  converting
32        the  shares  of  the  merging  bank and the mid-tier bank
33        holding company into shares of the merging bank  and  the
 
HB2538 Engrossed            -61-               LRB9201093JScs
 1        manner of transferring the converted shares to the parent
 2        bank holding company;
 3             (d)  a   statement  that  the  merger  agreement  is
 4        subject to approval by the Commissioner and that  whether
 5        approved or disapproved, the parties thereto will pay the
 6        Commissioner's expenses of examination; and
 7             (e)  such  other  provisions as the Commissioner may
 8        reasonably require to enable him to discharge his  duties
 9        with respect to the merger.
10        (2)  After  approval  by  the  board  of directors of the
11    parent bank holding company, the merger  agreement  shall  be
12    submitted to the Commissioner for approval.
13        (3)  After  receipt  by  the  Commissioner  of the papers
14    specified in item (2), he shall  approve  or  disapprove  the
15    merger  agreement.   The  Commissioner  shall not approve the
16    agreement unless he shall be of the opinion  and  finds  that
17    the  same  matters  exist  in  respect of the continuing bank
18    which would have been required under Section 10 of  this  Act
19    for  the  organization  of a new bank, that the mid-tier bank
20    holding company has no known  liabilities  that  will  become
21    liabilities  of the continuing bank, and that the parent bank
22    holding company will indemnify the continuing  bank  for  any
23    known  and  unknown  contingent  liabilities  for  which  the
24    continuing bank may become liable as a result of the merger.
25    Nothing  in  this  Section  shall authorize a resulting State
26    bank to acquire, hold, or invest any asset or  to  assume  or
27    incur  any  liability  that  does  not  conform  to the legal
28    requirements  for  assets  acquired,  held,  or  invested  or
29    liabilities assumed or incurred by State banks, or to  engage
30    in  any  activity  in which a State bank is not authorized to
31    engage as  part  of  a  general  banking  business.   If  the
32    Commissioner disapproves the merger agreement, he shall state
33    his  objections  in  writing  and  give an opportunity to the
34    merging bank and mid-tier bank holding company to obviate the
 
HB2538 Engrossed            -62-               LRB9201093JScs
 1    objections.
 2        (4)  To be effective, if approved by the Commissioner,  a
 3    copy  of the merger agreement executed by the duly authorized
 4    president of the mid-tier bank holding company and  president
 5    of  the  merging  State  bank,  together  with  copies of the
 6    resolution of the board  of  directors  of  the  parent  bank
 7    holding company, approving the merger agreement, certified by
 8    the parent bank holding company's president or vice-president
 9    and  attested  by  the  secretary,  must  be  filed  with the
10    Commissioner.  The merger  shall,  unless  a  later  date  is
11    specified   in  the  agreement,  become  effective  when  the
12    Commissioner  has  approved  the  agreement  and   issued   a
13    certificate  of  merger  to  the continuing bank, which shall
14    specify the name of the mid-tier bank  holding  company,  the
15    name  of  the  continuing  bank,  and  the  amendments to the
16    charter of the continuing bank provided  for  by  the  merger
17    agreement.   The charter of the mid-tier bank holding company
18    shall thereupon automatically  terminate.   Such  certificate
19    shall  be  conclusive  evidence  of  the  merger  and  of the
20    correctness of all proceedings therefor  in  all  courts  and
21    places  including  the  office of the Secretary of State, and
22    the certificate shall be recorded.
23    (Source: P.A. 89-364, eff. 8-18-95.)

24        (205 ILCS 5/31) (from Ch. 17, par. 338)
25        Sec. 31. Emergency sale of assets, change in control,  or
26    merger.
27        (a)  With the prior written approval of the Commissioner,
28    any  State  bank  in  danger  of  default  may,  by vote of a
29    majority of its board of directors, and without a vote of its
30    shareholders,  and  any  State  bank  in  default   may,   by
31    appropriate  action  of  its  receiver  or  conservator,  and
32    without  a  vote of its shareholders, sell all or any part of
33    its assets to another State bank  that  is  not  an  eligible
 
HB2538 Engrossed            -63-               LRB9201093JScs
 1    depository  institution,  to  a  national bank that is not an
 2    eligible  depository  institution,  to  an  insured   savings
 3    association  that  is not an eligible depository institution,
 4    to the Federal Deposit Insurance Corporation, or to  any  one
 5    or  more  of  them, provided that a State bank that is not an
 6    eligible depository institution, a national bank that is  not
 7    an   eligible  depository  institution,  an  insured  savings
 8    association that is not an eligible  depository  institution,
 9    the Federal Deposit Insurance Corporation, or any one or more
10    of  them  assumes  in  writing  all of the liabilities of the
11    selling  bank  as  shown  by  its  records,  other  than  the
12    liabilities of the selling bank to its shareholders as such.
13        (b)  If the Commissioner has made  one  or  more  of  the
14    findings  provided  in  Section  51,  and the finding that an
15    emergency exists as  provided  in  Section  52,  and  if,  in
16    addition, the Commissioner gives his approval in writing, any
17    State  bank  may,  by  vote  of  a  majority  of its board of
18    directors and without a vote of its shareholders, merge  with
19    another  State  bank  that  is  not  an  eligible  depository
20    institution,   a  national  bank  that  is  not  an  eligible
21    depository institution, or  an  insured  savings  association
22    located  in  Illinois  that  is  not  an  eligible depository
23    institution, and after May 31,  1997,  an  out-of-state  bank
24    that  is  not  an  eligible depository institution, with such
25    other  State  bank,  out-of-state  bank,  national  bank,  or
26    insured savings association being the resulting or continuing
27    bank or resulting  insured  savings  association  in  such  a
28    merger.
29        (c)  With the prior written approval of the Commissioner,
30    any  State bank may either purchase, assume, or both purchase
31    and assume all or any part of the assets or  liabilities,  or
32    act  as  paying agent for the payment of deposit insurance to
33    the depositors of an eligible depository institution.
34        (d)  With the prior written approval of the Commissioner,
 
HB2538 Engrossed            -64-               LRB9201093JScs
 1    a State bank may, by vote of  a  majority  of  its  board  of
 2    directors  and without a vote of its shareholders, merge with
 3    an insured savings association, national bank, or  after  May
 4    31,  1997,  out-of-state  bank,  in  default  or in danger of
 5    default, provided such State bank results from  such  merger,
 6    and  provided  further that such resulting bank shall conform
 7    all assets acquired or liabilities incurred as  a  result  of
 8    such  merger  to  the  legal  requirements  for  such  assets
 9    acquired, held or invested or liabilities assumed or incurred
10    by  State  banks,  and that such resulting or continuing bank
11    shall conform all of its activities to  those  activities  in
12    which  a  State  bank  is  authorized  to engage as part of a
13    general banking business.
14        (d-5)  If the Commissioner has made one or  more  of  the
15    findings  provided  in  Section  51  or  the  finding that an
16    emergency exists as  provided  in  Section  52,  and  if,  in
17    addition,  the  Commissioner gives his approval in writing, a
18    change in the ownership of outstanding  stock  of  any  State
19    bank, including the acquisition of stock of the State bank by
20    any  bank  holding  company,  may  occur  that will result in
21    control or a change in the control of the  State  bank  or  a
22    change  in the control of a holding company having control of
23    the  outstanding  stock  of  a  State  bank,  including   the
24    acquisition  of  stock  of  such holding company by any other
25    bank holding company, which  will  result  in  control  or  a
26    change in control of the bank or holding company.
27        (e)  Nothing in this Section shall authorize a State bank
28    to  acquire,  hold, or invest any asset or to assume or incur
29    any liability that does not conform to the legal requirements
30    for assets acquired, held, or invested or liabilities assumed
31    or incurred by State banks, or to engage in any  activity  in
32    which  a  State bank is not authorized to engage as part of a
33    general banking business.
34        (f)  Nothing in  this  Section  shall  authorize  a  bank
 
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 1    holding  company to own or control, directly or indirectly, a
 2    State bank  or  a  national  bank  having  its  main  banking
 3    premises  in  Illinois  unless  such  ownership or control is
 4    expressly authorized under the  provisions  of  the  Illinois
 5    Bank Holding Company Act of 1957.
 6    (Source: P.A. 88-4; 89-208, eff. 9-29-95.)

 7        (205 ILCS 5/33) (from Ch. 17, par. 341)
 8        Sec.  33.  Marketable  investment  securities  limit. Any
 9    State bank  may  purchase  for  its  own  account  marketable
10    investment  securities  without regard to any other liability
11    to the bank of the issuer, maker, obligor,  or  guarantor  of
12    any marketable investment securities, but the total amount of
13    the marketable investment securities of any one issuer, maker
14    or  obligor  held  by  the bank or for its account at any one
15    time shall not exceed  20%  of  its  unimpaired  capital  and
16    unimpaired   surplus.  As  used  in  this  Section  the  term
17    "marketable   investment   securities"    means    marketable
18    obligations evidencing indebtedness of any person in the form
19    of  bonds,  notes, or debentures commonly known as investment
20    securities;  obligations  identified   by   certificates   of
21    participation  in investments the bank could have invested in
22    directly; and includes certificates of participation in  open
23    end  investment  companies registered with the Securities and
24    Exchange Commission pursuant to the Investment Company Act of
25    1940 and Securities Act  of  1933  commonly  referred  to  as
26    mutual  or  money  market  funds,  provided the portfolios of
27    those investment companies consist of investments that a bank
28    could invest in directly.  Marketable  investment  securities
29    shall  be  rated  in  the top 4 rating categories by national
30    rating services and designated as "investment grade" or "bank
31    quality investments" securities. The  rating  restriction  on
32    marketable investment securities does not apply to securities
33    that are issued by a public agency as defined in Section 1 of
 
HB2538 Engrossed            -66-               LRB9201093JScs
 1    the Public Funds Investment Act.
 2    (Source: P.A. 88-546; 89-364, eff. 8-18-95.)

 3        (205 ILCS 5/37) (from Ch. 17, par. 347)
 4        Sec.  37. Loans to officers and loans on and purchases of
 5    bank's own stock.
 6        (1)  No state bank shall make any loan  or  extension  of
 7    credit  in  excess  of  the  limits,  as  determined  by  the
 8    Commissioner,  at  any  one  time  outstanding  each  to  its
 9    president,  or  to any of its vice presidents or its salaried
10    officers or employees or  directors  or  to  corporations  or
11    firms,  controlled by them, or in the management of which any
12    of them are actively engaged, unless such loan  or  extension
13    of  credit  shall  have  been first approved, by the board of
14    directors.  The Commissioner shall prescribe such  limits  by
15    rules.
16        (2)  It  shall not be lawful for a state bank to make any
17    loan or discount on the security of the  shares  of  its  own
18    capital  stock  or  preferred stock or on the security of its
19    own  debentures  or  evidences  of  debt  which  are   either
20    convertible  into  capital stock or are junior or subordinate
21    in right of payment to deposit or other  liabilities  of  the
22    bank.
23        (3)(a)  For purposes of this Section, "control" means (i)
24    ownership,  control,  or  power  to  vote  25% or more of the
25    outstanding shares of any class of  voting  security  of  the
26    corporation  or  firm,  directly  or  indirectly,  or  acting
27    through  or  in  concert with one or more other persons; (ii)
28    control in any manner over the election of a majority of  the
29    directors  of  the corporation or firm; or (iii) the power to
30    exercise a  controlling  influence  over  the  management  or
31    policies  of the corporation or firm, directly or indirectly,
32    or acting through or in concert with one or more persons.
33        (3)(b)  A person does not have the power  to  exercise  a
 
HB2538 Engrossed            -67-               LRB9201093JScs
 1    controlling  influence  over  the management or policies of a
 2    corporation or firm solely by virtue of the person's position
 3    as an officer or director of the corporation or firm.
 4        (3)(c)  A person is presumed to have  control,  including
 5    the  power  to  exercise  a  controlling  influence  over the
 6    management or policies, of a corporation or firm if:
 7             (i)  the person:
 8                  (A)  is  an  executive  officer,  director,  or
 9             individual  exercising  similar  functions  of   the
10             corporation or firm; and
11                  (B)  directly  or indirectly owns, controls, or
12             has the power to vote more than 10% of any class  of
13             voting securities of the corporation or firm; or
14             (ii)(A)  the  person  directly  or  indirectly owns,
15        controls, or has the power to vote more than 10%  of  any
16        class  of  voting  securities of the corporation or firm;
17        and
18                  (B)  no other  person  directly  or  indirectly
19             owns,  controls,  or has the power to vote a greater
20             percentage of that class of voting securities.
21        (3)(d)  A person  may  rebut  a  presumption  established
22    under  subdivision  (3)(c)  of  this  Section  by  submitting
23    written  materials  that,  in  the  Commissioner's  judgment,
24    demonstrate an absence of control.
25    (Source: P.A. 86-754.)

26        (205 ILCS 5/47) (from Ch. 17, par. 358)
27        Sec. 47.  Reports to Commissioner.
28        (a)  All  State  banks  shall  make  a  full and accurate
29    statement of their  affairs  at  least  1  time  during  each
30    calendar  quarter  which shall be certified to, under oath by
31    the president, a vice-president or the cashier of such  bank.
32    If  the  statement  is  submitted  in  electronic  form,  the
33    Commissioner  may,  in  the  call for the report, specify the
 
HB2538 Engrossed            -68-               LRB9201093JScs
 1    manner in which the appropriate officer  of  the  bank  shall
 2    certify  the  statement  of  affairs.  The statement shall be
 3    according  to  the  form  which  may  be  prescribed  by  the
 4    Commissioner  and  shall  exhibit   in   detail   information
 5    concerning  such bank at the close of business of any day the
 6    Commissioner may choose and designate  in  a  call  for  such
 7    report.   Each  bank shall deliver its quarterly statement to
 8    the location specified by the Commissioner within 30 calendar
 9    days of the date of  the  call  for  such  reports.   If  the
10    quarterly  statement  is mailed, it must be postmarked within
11    the period prescribed for  delivery,  and  if  the  quarterly
12    statement  is  delivered  in  electronic form, the bank shall
13    generate and retain satisfactory proof that it has caused the
14    report to be  delivered  within  the  period  prescribed  for
15    delivery.  Within  60  calendar days after the Commissioner's
16    call for the fourth calendar quarter statement of affairs,  a
17    State  bank  shall  publish  an  annual  disclosure statement
18    setting  forth  the  information  required  by  rule  of  the
19    Commissioner.  The disclosure  statement  shall  contain  the
20    required  information  as  of  the  close of the business day
21    designated  by  the  Commissioner  for  the  fourth   quarter
22    statement  of  affairs.  Any bank failing to make and deliver
23    such statement or to  comply  with  any  provisions  of  this
24    Section   may   be  subject  to  a  penalty  payable  to  the
25    Commissioner of $100 for each day of noncompliance.
26        (b)  In addition to the foregoing reports, any bank which
27    is the victim of a shortage of funds in excess of $10,000, an
28    apparent misapplication of the bank's funds  by  an  officer,
29    employee  or  director,  or  any  adverse  legal action in an
30    amount in excess of  10%  of  total  unimpaired  capital  and
31    unimpaired surplus of the bank, including but not limited to,
32    the  entry of an adverse money judgment against the bank or a
33    write-off  of  assets  of  the  bank,   shall   report   that
34    information  in  writing to the Commissioner within 7 days of
 
HB2538 Engrossed            -69-               LRB9201093JScs
 1    the occurrence. Compliance with the time frames prescribed by
 2    the United States Department of Treasury's  Financial  Crimes
 3    Enforcement  Network  shall  be  deemed  compliance with this
 4    Section. Neither the bank, its directors, officers, employees
 5    or its agents, in the preparation or filing  of  the  reports
 6    required  by subsection (b) of this Section, shall be subject
 7    to  any  liability  for  libel,  slander,  or  other  charges
 8    resulting from information supplied in such  reports,  except
 9    when  the  supplying of such information is done in a corrupt
10    or malicious manner or otherwise not in good faith.
11    (Source: P.A. 89-505, eff.  6-28-96;  89-567,  eff.  7-26-96;
12    90-14, eff. 7-1-97.)

13        (205 ILCS 5/48) (from Ch. 17, par. 359)
14        Sec. 48. Commissioner's powers; duties.  The Commissioner
15    shall  have the powers and authority, and is charged with the
16    duties and responsibilities designated in  this  Act,  and  a
17    State bank shall not be subject to any other visitorial power
18    other  than as authorized by this Act, except those vested in
19    the courts, or upon prior consultation with the Commissioner,
20    a foreign bank  regulator  with  an  appropriate  supervisory
21    interest  in the parent or affiliate of a state bank.  In the
22    performance of the Commissioner's duties:
23        (1)  The Commissioner shall call for statements from  all
24    State  banks  as  provided  in  Section  47 at least one time
25    during each calendar quarter.
26        (2) (a)  The Commissioner, as often as  the  Commissioner
27    shall  deem  necessary or proper, and no less frequently than
28    18 months following the preceding examination, shall  appoint
29    a  suitable  person  or persons to make an examination of the
30    affairs of every State bank, except that for  every  eligible
31    State  bank,  as  defined  by regulation, the Commissioner in
32    lieu of the examination may accept on  an  alternating  basis
33    the examination made by the eligible State bank's appropriate
 
HB2538 Engrossed            -70-               LRB9201093JScs
 1    federal banking agency pursuant to Section 111 of the Federal
 2    Deposit   Insurance  Corporation  Improvement  Act  of  1991,
 3    provided the appropriate federal banking agency has made such
 4    an examination.   A  person  so  appointed  shall  not  be  a
 5    stockholder  or  officer  or  employee of any bank which that
 6    person may be directed to examine, and shall have  powers  to
 7    make  a thorough examination into all the affairs of the bank
 8    and in so doing to examine any of the officers or  agents  or
 9    employees  thereof on oath and shall make a full and detailed
10    report of the condition of the bank to the Commissioner.   In
11    making   the  examination  the  examiners  shall  include  an
12    examination of the affairs of all the affiliates of the bank,
13    as defined in subsection (b) of Section 35.2 of this Act,  or
14    subsidiaries  of  the  bank as shall be necessary to disclose
15    fully the conditions of the subsidiaries or  affiliates,  the
16    relations between the bank and the subsidiaries or affiliates
17    and  the  effect  of  those relations upon the affairs of the
18    bank, and in connection therewith shall have power to examine
19    any of the officers, directors, agents, or employees  of  the
20    subsidiaries  or affiliates on oath.  After May 31, 1997, the
21    Commissioner may enter into cooperative agreements with state
22    regulatory  authorities  of  other  states  to  provide   for
23    examination  of  State bank branches in those states, and the
24    Commissioner may accept reports of examinations of State bank
25    branches from those  state  regulatory  authorities.    These
26    cooperative  agreements may set forth the manner in which the
27    other state regulatory authorities  may  be  compensated  for
28    examinations prepared for and submitted to the Commissioner.
29        (b)  After  May  31, 1997, the Commissioner is authorized
30    to examine, as often as the Commissioner shall deem necessary
31    or proper, branches of out-of-state banks.  The  Commissioner
32    may  establish  and  may  assess  fees  to  be  paid  to  the
33    Commissioner for examinations under this subsection (b).  The
34    fees shall be borne by the out-of-state bank, unless the fees
 
HB2538 Engrossed            -71-               LRB9201093JScs
 1    are  borne  by  the state regulatory authority that chartered
 2    the  out-of-state  bank,  as  determined  by  a   cooperative
 3    agreement  between  the Commissioner and the state regulatory
 4    authority that chartered the out-of-state bank.
 5        (2.5)  Whenever  any  State  bank,  any   subsidiary   or
 6    affiliate  of a State bank, or after May 31, 1997, any branch
 7    of an out-of-state bank causes to be performed,  by  contract
 8    or otherwise, any bank services for itself, whether on or off
 9    its premises:
10             (a)  that    performance   shall   be   subject   to
11        examination by the Commissioner to the same extent as  if
12        services  were  being performed by the bank or, after May
13        31, 1997, branch of the out-of-state bank itself  on  its
14        own premises; and
15             (b)  the  bank or, after May 31, 1997, branch of the
16        out-of-state bank shall notify the  Commissioner  of  the
17        existence  of  a  service relationship.  The notification
18        shall be submitted with the first statement of  condition
19        (as  required  by  Section  47 of this Act) due after the
20        making of the service contract or the performance of  the
21        service,  whichever occurs first.  The Commissioner shall
22        be notified of  each  subsequent  contract  in  the  same
23        manner.
24        For  purposes  of  this  subsection (2.5), the term "bank
25    services" means services  such  as  sorting  and  posting  of
26    checks  and deposits, computation and posting of interest and
27    other credits and charges, preparation and mailing of checks,
28    statements,  notices,  and  similar  items,  or   any   other
29    clerical,  bookkeeping,  accounting,  statistical, or similar
30    functions performed for  a  State  bank,  including  but  not
31    limited  to  electronic data processing related to those bank
32    services.
33        (3)  The expense of administering this Act, including the
34    expense of the examinations of State  banks  as  provided  in
 
HB2538 Engrossed            -72-               LRB9201093JScs
 1    this  Act,  shall to the extent of the amounts resulting from
 2    the fees provided for in paragraphs (a), (a-2),  and  (b)  of
 3    this  subsection  (3)  be  assessed  against and borne by the
 4    State banks:
 5             (a)  Each bank shall pay to the Commissioner a  Call
 6        Report  Fee which shall be paid in quarterly installments
 7        equal to one-fourth of the sum of the annual fixed fee of
 8        $800, plus a variable fee based on the  assets  shown  on
 9        the  quarterly  statement  of  condition delivered to the
10        Commissioner  in  accordance  with  Section  47  for  the
11        preceding quarter according to  the  following  schedule:
12        16¢  per  $1,000 of the first $5,000,000 of total assets,
13        15¢ per $1,000 of the next $20,000,000 of  total  assets,
14        13¢  per $1,000 of the next $75,000,000  of total assets,
15        9¢ per $1,000 of the next $400,000,000 of  total  assets,
16        7¢  per  $1,000 of the next $500,000,000 of total assets,
17        and  5¢  per  $1,000  of  all   assets   in   excess   of
18        $1,000,000,000,  of  the  State bank. The Call Report Fee
19        shall be calculated by the Commissioner and billed to the
20        banks  for  remittance  at  the  time  of  the  quarterly
21        statements of condition provided for in Section  47.  The
22        Commissioner  may require payment of the fees provided in
23        this Section by an electronic transfer  of  funds  or  an
24        automatic debit of an account of each of the State banks.
25        In  case  more than one examination of any bank is deemed
26        by the Commissioner to be necessary  in  any  examination
27        frequency  cycle  specified  in  subsection  2(a) of this
28        Section,  and  is  performed  at   his   direction,   the
29        Commissioner  may  assess  a reasonable additional fee to
30        recover the cost of the additional examination; provided,
31        however, that an examination conducted at the request  of
32        the  State  Treasurer pursuant to the Uniform Disposition
33        of Unclaimed Property Act shall not be deemed  to  be  an
34        additional examination under this Section. In lieu of the
 
HB2538 Engrossed            -73-               LRB9201093JScs
 1        method  and  amounts  set forth in this paragraph (a) for
 2        the calculation of the Call Report Fee, the  Commissioner
 3        may specify by rule that the Call Report Fees provided by
 4        this  Section  may be assessed semiannually or some other
 5        period and may provide in the rule the formula to be used
 6        for calculating and assessing the  periodic  Call  Report
 7        Fees to be paid by State banks.
 8             (a-1)  If  in  the  opinion  of  the Commissioner an
 9        emergency exists or appears likely, the Commissioner  may
10        assign an examiner or examiners to monitor the affairs of
11        a   State   bank   with   whatever   frequency  he  deems
12        appropriate, including but not limited to a daily  basis.
13        The reasonable and necessary expenses of the Commissioner
14        during the period of the monitoring shall be borne by the
15        subject  bank.   The Commissioner shall furnish the State
16        bank a statement of time and expenses if requested to  do
17        so  within  30  days  of the conclusion of the monitoring
18        period.
19             (a-2)  On and after January 1, 1990, the  reasonable
20        and   necessary   expenses  of  the  Commissioner  during
21        examination  of  the  performance  of   electronic   data
22        processing services under subsection (2.5) shall be borne
23        by  the  banks  for  which the services are provided.  An
24        amount, based upon a  fee  structure  prescribed  by  the
25        Commissioner,  shall  be  paid by the banks or, after May
26        31, 1997, branches of out-of-state  banks  receiving  the
27        electronic  data  processing services along with the Call
28        Report  Fee  assessed  under  paragraph   (a)   of   this
29        subsection (3).
30             (a-3)  After   May  31,  1997,  the  reasonable  and
31        necessary expenses of the Commissioner during examination
32        of the performance of electronic data processing services
33        under subsection (2.5) at or on  behalf  of  branches  of
34        out-of-state  banks  shall  be  borne by the out-of-state
 
HB2538 Engrossed            -74-               LRB9201093JScs
 1        banks, unless those  expenses  are  borne  by  the  state
 2        regulatory  authorities  that  chartered the out-of-state
 3        banks, as determined by  cooperative  agreements  between
 4        the  Commissioner  and  the  state regulatory authorities
 5        that chartered the out-of-state banks.
 6             (b)  "Fiscal year" for purposes of this  Section  48
 7        is  defined  as a period beginning July 1 of any year and
 8        ending June 30 of the next year. The  Commissioner  shall
 9        receive  for each fiscal year, commencing with the fiscal
10        year ending June 30, 1987, a contingent fee equal to  the
11        lesser  of  the  aggregate  of the fees paid by all State
12        banks under paragraph (a)  of  subsection  (3)  for  that
13        year, or the amount, if any, whereby the aggregate of the
14        administration expenses, as defined in paragraph (c), for
15        that  fiscal year exceeds the sum of the aggregate of the
16        fees payable by all  State  banks  for  that  year  under
17        paragraph   (a)  of  subsection  (3),  plus  any  amounts
18        transferred into the Bank and Trust Company Fund from the
19        State Pensions Fund for that year, plus all other amounts
20        collected by the Commissioner for  that  year  under  any
21        other  provision  of  this Act, plus the aggregate of all
22        fees collected for that year by  the  Commissioner  under
23        the  Corporate  Fiduciary Act, excluding the receivership
24        fees provided  for  in  Section  5-10  of  the  Corporate
25        Fiduciary  Act,  and  the Foreign Banking Office Act. The
26        aggregate amount of the contingent fee  thus  arrived  at
27        for   any  fiscal  year  shall  be  apportioned  amongst,
28        assessed upon, and paid by the State  banks  and  foreign
29        banking   corporations,   respectively,   in   the   same
30        proportion  that  the  fee of each under paragraph (a) of
31        subsection (3), respectively, for that year bears to  the
32        aggregate  for  that  year  of  the  fees collected under
33        paragraph (a) of subsection (3). The aggregate amount  of
34        the  contingent  fee,  and  the  portion  thereof  to  be
 
HB2538 Engrossed            -75-               LRB9201093JScs
 1        assessed   upon  each  State  bank  and  foreign  banking
 2        corporation, respectively, shall  be  determined  by  the
 3        Commissioner  and  shall  be  paid by each, respectively,
 4        within 120 days of the close of the period for which  the
 5        contingent  fee  is  computed  and  is  payable,  and the
 6        Commissioner shall give 20 days  advance  notice  of  the
 7        amount  of  the  contingent fee payable by the State bank
 8        and of the date fixed by the Commissioner for payment  of
 9        the fee.
10             (c)  The  "administration  expenses"  for any fiscal
11        year shall mean the ordinary and contingent expenses  for
12        that  year  incident  to making the examinations provided
13        for by, and for otherwise administering,  this  Act,  the
14        Corporate Fiduciary Act, excluding the expenses paid from
15        the  Corporate Fiduciary Receivership account in the Bank
16        and Trust Company Fund, the Foreign Banking  Office  Act,
17        the  Electronic  Fund Transfer Act, and the Illinois Bank
18        Examiners'  Education  Foundation  Act,   including   all
19        salaries   and   other  compensation  paid  for  personal
20        services rendered for the State by officers or  employees
21        of  the  State, including the Commissioner and the Deputy
22        Commissioners,  all  expenditures   for   telephone   and
23        telegraph  charges,  postage  and  postal charges, office
24        stationery, supplies and services, and  office  furniture
25        and  equipment,  including  typewriters  and  copying and
26        duplicating machines and filing  equipment,  surety  bond
27        premiums,  and  travel  expenses  of  those  officers and
28        employees, employees, expenditures  or  charges  for  the
29        acquisition,  enlargement  or  improvement of, or for the
30        use of, any office  space,  building,  or  structure,  or
31        expenditures   for   the   maintenance   thereof  or  for
32        furnishing heat, light, or power  with  respect  thereto,
33        all  to  the  extent that those expenditures are directly
34        incidental to such examinations or administration.    The
 
HB2538 Engrossed            -76-               LRB9201093JScs
 1        Commissioner  shall  not be required by paragraphs (c) or
 2        (d-1) of this subsection (3) to maintain  in  any  fiscal
 3        year's  budget appropriated reserves for accrued vacation
 4        and accrued sick leave that is required  to  be  paid  to
 5        employees  of  the Commissioner upon termination of their
 6        service with the Commissioner in an amount that  is  more
 7        than  is  reasonably  anticipated to be necessary for any
 8        anticipated turnover in employees, whether due to  normal
 9        attrition   or   due   to   layoffs,   terminations,   or
10        resignations.
11             (d)  The  aggregate  of  all  fees  collected by the
12        Commissioner under this Act, the Corporate Fiduciary Act,
13        or the Foreign Banking Office Act on and  after  July  1,
14        1979,  shall  be paid promptly after receipt of the same,
15        accompanied by a detailed  statement  thereof,  into  the
16        State  treasury  and shall be set apart in a special fund
17        to be known as the "Bank and Trust Company Fund",  except
18        as  provided  in paragraph (c) of subsection (11) of this
19        Section. The amount from time to time deposited into  the
20        Bank  and  Trust Company Fund shall be used to offset the
21        ordinary administrative expenses of the  Commissioner  of
22        Banks and Real Estate as defined in this Section. Nothing
23        in  this  amendatory Act of 1979 shall prevent continuing
24        the  practice  of  paying  expenses  involving  salaries,
25        retirement, social  security,  and  State-paid  insurance
26        premiums  of  State  officers  by appropriations from the
27        General Revenue Fund.  However, the General Revenue  Fund
28        shall  be reimbursed for those payments made on and after
29        July 1, 1979, by an annual transfer  of  funds  from  the
30        Bank and Trust Company Fund.
31             (d-1)  Adequate funds shall be available in the Bank
32        and  Trust  Company  Fund to permit the timely payment of
33        administration expenses.  In each fiscal year  the  total
34        administration  expenses shall be deducted from the total
 
HB2538 Engrossed            -77-               LRB9201093JScs
 1        fees collected by  the  Commissioner  and  the  remainder
 2        transferred  into  the  Cash Flow Reserve Account, unless
 3        the balance of the Cash Flow Reserve Account prior to the
 4        transfer  equals  or  exceeds  one-fourth  of  the  total
 5        initial appropriations from the Bank  and  Trust  Company
 6        Fund for the subsequent year, in which case the remainder
 7        shall  be  credited  to  State  banks and foreign banking
 8        corporations and  applied  against  their  fees  for  the
 9        subsequent  year.  The amount credited to each State bank
10        and foreign banking corporation  shall  be  in  the  same
11        proportion  as  the Call Report Fees paid by each for the
12        year bear to the total Call Report Fees collected for the
13        year.  If, after a transfer  to  the  Cash  Flow  Reserve
14        Account  is  made  or  if  no  remainder is available for
15        transfer, the balance of the Cash Flow Reserve Account is
16        less than one-fourth of the total initial  appropriations
17        for  the  subsequent  year  and the amount transferred is
18        less than 5% of the total Call Report Fees for the  year,
19        additional  amounts  needed to make the transfer equal to
20        5% of the total Call Report Fees for the  year  shall  be
21        apportioned amongst, assessed upon, and paid by the State
22        banks  and  foreign  banking  corporations  in  the  same
23        proportion   that   the   Call   Report   Fees  of  each,
24        respectively, for the year bear to the total Call  Report
25        Fees  collected  for  the  year.   The additional amounts
26        assessed shall be transferred into the Cash Flow  Reserve
27        Account.   For  purposes  of  this  paragraph  (d-1), the
28        calculation of the fees  collected  by  the  Commissioner
29        shall  exclude  the  receivership  fees  provided  for in
30        Section 5-10 of the Corporate Fiduciary Act.
31             (e)  The Commissioner may upon  request  certify  to
32        any public record in his keeping and shall have authority
33        to levy a reasonable charge for issuing certifications of
34        any public record in his keeping.
 
HB2538 Engrossed            -78-               LRB9201093JScs
 1             (f)  In  addition  to  fees  authorized elsewhere in
 2        this Act, the Commissioner  may,  in  connection  with  a
 3        review,  approval,  or  provision  of  a  service, levy a
 4        reasonable charge to recover  the  cost  of  the  review,
 5        approval, or service.
 6        (4)  Nothing  contained in this Act shall be construed to
 7    limit the obligation relative to examinations and reports  of
 8    any  State  bank, deposits in which are to any extent insured
 9    by the United States or any agency thereof, nor to  limit  in
10    any  way  the  powers  of  the Commissioner with reference to
11    examinations and reports of that bank.
12        (5)  The  nature  and  condition  of  the  assets  in  or
13    investment of any bonus, pension, or profit sharing plan  for
14    officers  or  employees of every State bank or, after May 31,
15    1997, branch of an out-of-state bank shall be  deemed  to  be
16    included  in  the  affairs of that State bank or branch of an
17    out-of-state bank subject to examination by the  Commissioner
18    under  the  provisions of subsection (2) of this Section, and
19    if the Commissioner shall find from an examination  that  the
20    condition of or operation of the investments or assets of the
21    plan  is unlawful, fraudulent, or unsafe, or that any trustee
22    has  abused  his  trust,  the  Commissioner  shall,  if   the
23    situation so found by the Commissioner shall not be corrected
24    to his satisfaction within 60 days after the Commissioner has
25    given  notice  to the board of directors of the State bank or
26    out-of-state bank of his findings, report the  facts  to  the
27    Attorney  General  who  shall thereupon institute proceedings
28    against the State bank or out-of-state  bank,  the  board  of
29    directors  thereof,  or  the  trustees under such plan as the
30    nature of the case may require.
31        (6)  The Commissioner shall have the power:
32             (a)  To promulgate reasonable rules for the  purpose
33        of administering the provisions of this Act.
34             (a-5)  To  impose  conditions on any approval issued
 
HB2538 Engrossed            -79-               LRB9201093JScs
 1        by the Commissioner if he determines that the  conditions
 2        are  necessary  or approprite.  These conditions shall be
 3        imposed in writing and shall continue in effect  for  the
 4        period prescribed by the Commissioner.
 5             (b)  To  issue  orders  against  any  person, if the
 6        Commissioner has reasonable  cause  to  believe  that  an
 7        unsafe  or  unsound  banking  practice  has  occurred, is
 8        occurring, or is  about  to  occur,  if  any  person  has
 9        violated,  is  violating, or is about to violate any law,
10        rule, or written agreement with the Commissioner, or  for
11        the  purpose of administering the provisions of this Act,
12        and any rule promulgated in accordance with this Act.
13             (b-1)  To  enter  into  agreements   with   a   bank
14        establishing  a  program  to correct the condition of the
15        bank or its practices.
16             (c)  To appoint hearing officers to execute  any  of
17        the powers granted to the Commissioner under this Section
18        for  the  purpose  of administering this Act and any rule
19        promulgated in accordance with this Act and otherwise  to
20        authorize,  in  writing,  an  officer  or employee of the
21        Office of Banks and Real Estate to  exercise  his  powers
22        under this Act.
23             (d)  To   subpoena   witnesses,   to   compel  their
24        attendance, to administer an oath, to examine any  person
25        under oath, and to require the production of any relevant
26        books,  papers,  accounts, and documents in the course of
27        and pursuant to any investigation being conducted, or any
28        action being taken, by the Commissioner in respect of any
29        matter relating to the duties imposed upon, or the powers
30        vested in, the Commissioner under the provisions of  this
31        Act or any rule promulgated in accordance with this Act.
32             (e)  To conduct hearings.
33        (7)  Whenever,  in  the  opinion of the Commissioner, any
34    director, officer, employee, or agent of a State bank or  any
 
HB2538 Engrossed            -80-               LRB9201093JScs
 1    subsidiary  or bank holding company of the bank or, after May
 2    31, 1997, of any  branch  of  an  out-of-state  bank  or  any
 3    subsidiary  or  bank  holding  company of the bank shall have
 4    violated any law, rule, or order relating to that bank or any
 5    subsidiary or bank holding company of the  bank,  shall  have
 6    obstructed or impeded any examination or investigation by the
 7    Commissioner,  or  shall have engaged in an unsafe or unsound
 8    practice in conducting the  business  of  that  bank  or  any
 9    subsidiary or bank holding company of the bank, or shall have
10    violated  any law or engaged or participated in any unsafe or
11    unsound practice in connection with any financial institution
12    or other business entity such that the character and  fitness
13    of  the director, officer, employee, or agent does not assure
14    reasonable promise of safe and sound operation of  the  State
15    bank,  the Commissioner may issue an order of removal. If, in
16    the  opinion  of  the  Commissioner,  any  former   director,
17    officer, employee, or agent of a State bank or any subsidiary
18    or bank holding company of the bank, prior to the termination
19    of  his  or  her  service with that bank or any subsidiary or
20    bank holding company of the bank, violated any law, rule,  or
21    order  relating  to that State bank or any subsidiary or bank
22    holding company  of  the  bank,  obstructed  or  impeded  any
23    examination  or investigation by the Commissioner, or engaged
24    in an unsafe or unsound practice in conducting  the  business
25    of that bank or any subsidiary or bank holding company of the
26    bank,  or  violated any law or engaged or participated in any
27    unsafe or unsound practice in connection with  any  financial
28    institution  or other business entity such that the character
29    and fitness of the  director,  officer,  employee,  or  agent
30    would  not  have assured reasonable promise of safe and sound
31    operation of the State bank, the Commissioner  may  issue  an
32    order  prohibiting  that  person  from further service with a
33    bank or any subsidiary or bank holding company of the bank as
34    a director, officer, employee, or  agent.   An  order  issued
 
HB2538 Engrossed            -81-               LRB9201093JScs
 1    pursuant   to  this  subsection  shall  be  served  upon  the
 2    director, officer, employee, or agent. A copy  of  the  order
 3    shall  be  sent  to  each  director  of  the bank affected by
 4    registered mail.  The  person  affected  by  the  action  may
 5    request  a  hearing  before the State Banking Board within 10
 6    days after receipt of the  order  of  removal.   The  hearing
 7    shall  be  held by the Board within 30 days after the request
 8    has been received by  the  Board.  The  Board  shall  make  a
 9    determination approving, modifying, or disapproving the order
10    of  the Commissioner as its final administrative decision. If
11    a hearing is held by the Board,  the  Board  shall  make  its
12    determination  within  60  days  from  the  conclusion of the
13    hearing. Any person affected by a decision of the Board under
14    this subsection (7) of Section 48 of this Act  may  have  the
15    decision  reviewed  only  under  and  in  accordance with the
16    Administrative Review Law  and  the  rules  adopted  pursuant
17    thereto.  A  copy  of the order shall also be served upon the
18    bank of which he is a director, officer, employee, or  agent,
19    whereupon he shall cease to be a director, officer, employee,
20    or  agent  of  that  bank.   The Commissioner may institute a
21    civil action against the director, officer, or agent  of  the
22    State  bank  or,  after  May  31,  1997, of the branch of the
23    out-of-state bank against whom any order provided for by this
24    subsection (7) of  this  Section  48  has  been  issued,  and
25    against  the  State bank or, after May 31, 1997, out-of-state
26    bank, to enforce compliance with or to enjoin  any  violation
27    of  the  terms  of  the  order.  Any  person who has been the
28    subject of an order of removal or  an  order  of  prohibition
29    issued  by  the Commissioner under this subsection or Section
30    5-6 of the Corporate Fiduciary Act may not  thereafter  serve
31    as director, officer, employee, or agent of any State bank or
32    of  any  branch of any out-of-state bank, or of any corporate
33    fiduciary, as defined in  Section  1-5.05  of  the  Corporate
34    Fiduciary  Act,  or  of  any  other entity that is subject to
 
HB2538 Engrossed            -82-               LRB9201093JScs
 1    licensure or regulation by the Commissioner or the Office  of
 2    Banks  and  Real  Estate  unless the Commissioner has granted
 3    prior approval in writing.
 4        For  purposes  of  this  paragraph  (7),  "bank   holding
 5    company"  has  the  meaning  prescribed  in  Section 2 of the
 6    Illinois Bank Holding Company Act of 1957.
 7        (8)  The Commissioner may impose civil penalties of up to
 8    $10,000  against  any  person  for  each  violation  of   any
 9    provision  of  this  Act,  any rule promulgated in accordance
10    with this Act,  any order of the Commissioner, or  any  other
11    action which in the Commissioner's discretion is an unsafe or
12    unsound banking practice.
13        (9)  The Commissioner may impose civil penalties of up to
14    $100  against any person for the first failure to comply with
15    reporting requirements set forth in the report of examination
16    of the bank and up to $200  for  the  second  and  subsequent
17    failures to comply with those reporting requirements.
18        (10)  All   final   administrative   decisions   of   the
19    Commissioner  hereunder  shall  be subject to judicial review
20    pursuant to the provisions of the Administrative Review  Law.
21    For  matters  involving administrative review, venue shall be
22    in either Sangamon County or Cook County.
23        (11)  The endowment fund for the Illinois Bank Examiners'
24    Education Foundation shall be administered as follows:
25             (a)  (Blank).
26             (b)  The  Foundation   is   empowered   to   receive
27        voluntary  contributions,  gifts,  grants,  bequests, and
28        donations on  behalf  of  the  Illinois  Bank  Examiners'
29        Education   Foundation  from  national  banks  and  other
30        persons for the purpose of funding the endowment  of  the
31        Illinois Bank Examiners' Education Foundation.
32             (c)  The  aggregate  of all special educational fees
33        collected by the Commissioner and  property  received  by
34        the   Commissioner   on   behalf  of  the  Illinois  Bank
 
HB2538 Engrossed            -83-               LRB9201093JScs
 1        Examiners' Education  Foundation  under  this  subsection
 2        (11)  on  or  after  June  30,  1986, shall be either (i)
 3        promptly paid after receipt of the same, accompanied by a
 4        detailed statement thereof, into the State  Treasury  and
 5        shall  be set apart in a special fund to be known as "The
 6        Illinois Bank Examiners' Education Fund" to  be  invested
 7        by  either  the Treasurer of the State of Illinois in the
 8        Public  Treasurers'  Investment  Pool  or  in  any  other
 9        investment he is authorized to make or  by  the  Illinois
10        State Board of Investment as the board of trustees of the
11        Illinois  Bank Examiners' Education Foundation may direct
12        or  (ii)  deposited  into  an  account  maintained  in  a
13        commercial bank or corporate fiduciary in the name of the
14        Illinois Bank Examiners' Education Foundation pursuant to
15        the order and direction of the Board of Trustees  of  the
16        Illinois Bank Examiners' Education Foundation.
17        (12)  (Blank).
18    (Source: P.A.   90-14,  eff.  7-1-97;  90-301,  eff.  8-1-97;
19    90-665, eff. 7-30-98; 91-16, eff. 7-1-99.)

20        (205 ILCS 5/48.1) (from Ch. 17, par. 360)
21        Sec. 48.1.  Customer financial records; confidentiality.
22        (a)  For the purpose of this Section, the term "financial
23    records" means any original, any copy, or any summary of:
24             (1)  a document granting signature authority over  a
25        deposit or account;
26             (2)  a statement, ledger card or other record on any
27        deposit  or  account,  which shows each transaction in or
28        with respect to that account;
29             (3)  a check, draft or money order drawn on  a  bank
30        or issued and payable by a bank; or
31             (4)  any    other    item   containing   information
32        pertaining  to  any  relationship  established   in   the
33        ordinary  course  of a bank's business between a bank and
 
HB2538 Engrossed            -84-               LRB9201093JScs
 1        its customer, including  financial  statements  or  other
 2        financial information provided by the customer.
 3        (b)  This Section does not prohibit:
 4             (1)  The   preparation,   examination,  handling  or
 5        maintenance of any  financial  records  by  any  officer,
 6        employee  or  agent  of  a  bank  having  custody  of the
 7        records, or the examination of the records by a certified
 8        public accountant engaged  by  the  bank  to  perform  an
 9        independent audit.
10             (2)  The examination of any financial records by, or
11        the  furnishing  of  financial  records by a bank to, any
12        officer, employee or agent of  (i)  the  Commissioner  of
13        Banks  and  Real Estate, (ii) after May 31, 1997, a state
14        regulatory authority authorized to examine a branch of  a
15        State   bank   located   in   another  state,  (iii)  the
16        Comptroller of the Currency,  (iv)  the  Federal  Reserve
17        Board,  or  (v) the Federal Deposit Insurance Corporation
18        for use solely in  the  exercise  of  his  duties  as  an
19        officer, employee, or agent.
20             (3)  The   publication   of   data   furnished  from
21        financial records relating to customers  where  the  data
22        cannot  be  identified  to  any  particular  customer  or
23        account.
24             (4)  The making of reports or returns required under
25        Chapter 61 of the Internal Revenue Code of 1986.
26             (5)  Furnishing  information concerning the dishonor
27        of any negotiable instrument permitted  to  be  disclosed
28        under the Uniform Commercial Code.
29             (6)  The  exchange in the regular course of business
30        of (i) credit information between a bank and other  banks
31        or  financial  institutions  or  commercial  enterprises,
32        directly  or  through a consumer reporting agency or (ii)
33        financial records or information derived  from  financial
34        records  between  a  bank  and  other  banks or financial
 
HB2538 Engrossed            -85-               LRB9201093JScs
 1        institutions or commercial enterprises for the purpose of
 2        conducting due diligence pursuant to a purchase  or  sale
 3        involving the bank or assets or liabilities of the bank.
 4             (7)  The    furnishing   of   information   to   the
 5        appropriate law enforcement authorities  where  the  bank
 6        reasonably believes it has been the victim of a crime.
 7             (8)  The furnishing of information under the Uniform
 8        Disposition of Unclaimed Property Act.
 9             (9)  The   furnishing   of   information  under  the
10        Illinois Income Tax  Act  and  the  Illinois  Estate  and
11        Generation-Skipping Transfer Tax Act.
12             (10)  The   furnishing   of  information  under  the
13        federal Currency and Foreign Transactions  Reporting  Act
14        Title 31, United States Code, Section 1051 et seq.
15             (11)  The  furnishing of information under any other
16        statute that by its terms or by  regulations  promulgated
17        thereunder  requires  the disclosure of financial records
18        other than by subpoena, summons, warrant, or court order.
19             (12)  The  furnishing  of  information   about   the
20        existence  of  an  account  of  a  person  to  a judgment
21        creditor of that person who has made  a  written  request
22        for that information.
23             (13)  The exchange in the regular course of business
24        of information between commonly owned banks in connection
25        with  a  transaction  authorized  under paragraph (23) of
26        Section 5 and conducted at an affiliate facility.
27             (14)  The furnishing of  information  in  accordance
28        with   the   federal  Personal  Responsibility  and  Work
29        Opportunity Reconciliation Act of 1996. Any bank governed
30        by this Act  shall  enter  into  an  agreement  for  data
31        exchanges  with  a State agency provided the State agency
32        pays to the bank a  reasonable  fee  not  to  exceed  its
33        actual  cost  incurred.   A bank providing information in
34        accordance with this item shall  not  be  liable  to  any
 
HB2538 Engrossed            -86-               LRB9201093JScs
 1        account  holder  or  other  person  for any disclosure of
 2        information  to  a  State  agency,  for  encumbering   or
 3        surrendering any assets held by the bank in response to a
 4        lien  or  order to withhold and deliver issued by a State
 5        agency, or for any other action taken  pursuant  to  this
 6        item, including individual or mechanical errors, provided
 7        the  action  does  not  constitute  gross  negligence  or
 8        willful  misconduct.  A  bank shall have no obligation to
 9        hold, encumber, or surrender assets  until  it  has  been
10        served  with  a  subpoena,  summons,  warrant,  court  or
11        administrative order, lien, or levy.
12             (15)  The exchange in the regular course of business
13        of  information  between  a  bank  and any commonly owned
14        affiliate of the bank, subject to the provisions  of  the
15        Financial Institutions Insurance Sales Law.
16             (16)  The   furnishing   of   information   to   law
17        enforcement authorities, the Illinois Department on Aging
18        and  its  regional  administrative and provider agencies,
19        the Department of  Human  Services  Office  of  Inspector
20        General, or public guardians, if the bank suspects that a
21        customer who is an elderly or disabled person has been or
22        may  become the victim of financial exploitation. For the
23        purposes of  this  item  (16),  the  term:  (i)  "elderly
24        person"  means  a  person who is 60 or more years of age,
25        (ii)  "disabled  person"  means  a  person  who  has   or
26        reasonably  appears  to  the  bank  to have a physical or
27        mental disability that impairs his or her ability to seek
28        or  obtain   protection   from   or   prevent   financial
29        exploitation,  and  (iii)  "financial exploitation" means
30        tortious or illegal use of the assets or resources of  an
31        elderly   or   disabled  person,  and  includes,  without
32        limitation, misappropriation of the elderly  or  disabled
33        person's  assets  or resources by undue influence, breach
34        of   fiduciary   relationship,    intimidation,    fraud,
 
HB2538 Engrossed            -87-               LRB9201093JScs
 1        deception,  extortion,  or the use of assets or resources
 2        in  any  manner  contrary  to  law.  A  bank  or   person
 3        furnishing  information  pursuant to this item (16) shall
 4        be entitled to the  same  rights  and  protections  as  a
 5        person  furnishing  information under the Elder Abuse and
 6        Neglect Act and the Illinois  Domestic  Violence  Act  of
 7        1986.
 8             (17)  The   disclosure   of   financial  records  or
 9        information  as  necessary  to  effect,  administer,   or
10        enforce  a  transaction  requested  or  authorized by the
11        customer, or in connection with:
12                  (A)  servicing  or   processing   a   financial
13             product  or  service  requested or authorized by the
14             customer;
15                  (B)  maintaining  or  servicing  a   customer's
16             account with the bank; or
17                  (C)  a  proposed  or  actual  securitization or
18             secondary market sale (including sales of  servicing
19             rights) related to a transaction of a customer.
20             Nothing  in  this item (17), however, authorizes the
21        sale  of  the  financial  records  or  information  of  a
22        customer without the consent of the customer.
23             (18)  The  disclosure  of   financial   records   or
24        information  as  necessary  to  protect against actual or
25        potential fraud, unauthorized  transactions,  claims,  or
26        other liability.
27        (c)  Except as otherwise provided by this Act, a bank may
28    not  disclose  to  any  person, except to the customer or his
29    duly authorized agent, any  financial  records  or  financial
30    information  obtained from financial records relating to that
31    customer of that bank unless:
32             (1)  the customer has authorized disclosure  to  the
33        person;
34             (2)  the financial records are disclosed in response
 
HB2538 Engrossed            -88-               LRB9201093JScs
 1        to  a  lawful  subpoena,  summons, warrant or court order
 2        which meets the requirements of subsection  (d)  of  this
 3        Section; or
 4             (3)  the bank is attempting to collect an obligation
 5        owed   to  the  bank  and  the  bank  complies  with  the
 6        provisions of  Section  2I  of  the  Consumer  Fraud  and
 7        Deceptive Business Practices Act.
 8        (d)  A   bank  shall  disclose  financial  records  under
 9    paragraph (2) of subsection  (c)  of  this  Section  under  a
10    lawful  subpoena, summons, warrant, or court order only after
11    the bank mails a copy of the subpoena, summons,  warrant,  or
12    court  order to the person establishing the relationship with
13    the  bank,   if   living,   and,   otherwise   his   personal
14    representative,  if known, at his last known address by first
15    class mail, postage prepaid, unless the bank is  specifically
16    prohibited  from notifying the person by order of court or by
17    applicable State or federal law.  A bank  shall  not  mail  a
18    copy  of a subpoena to any person pursuant to this subsection
19    if the  subpoena  was  issued  by  a  grand  jury  under  the
20    Statewide Grand Jury Act.
21        (e)  Any  officer or employee of a bank who knowingly and
22    willfully furnishes financial records in  violation  of  this
23    Section is guilty of a business offense and, upon conviction,
24    shall be fined not more than $1,000.
25        (f)  Any  person  who  knowingly and willfully induces or
26    attempts to induce any officer  or  employee  of  a  bank  to
27    disclose  financial  records  in violation of this Section is
28    guilty of a business offense and, upon conviction,  shall  be
29    fined not more than $1,000.
30        (g)  A  bank  shall  be  reimbursed  for  costs  that are
31    reasonably necessary and that have been directly incurred  in
32    searching  for,  reproducing,  or transporting books, papers,
33    records, or other data of a customer required or requested to
34    be produced pursuant to a lawful subpoena, summons,  warrant,
 
HB2538 Engrossed            -89-               LRB9201093JScs
 1    or  court  order.  The Commissioner shall determine the rates
 2    and conditions under which payment may be made.
 3    (Source: P.A.  90-18,  eff.  7-1-97;  90-665,  eff.  7-30-98;
 4    91-330, eff. 7-29-99; 91-929, eff. 12-15-00.)

 5        (205 ILCS 5/48.5)
 6        Sec. 48.5.  Reliance on Commissioner.
 7        (a)  The Commissioner may issue an opinion in response to
 8    a specific request from a member of the public or the banking
 9    industry or on his own initiative.  The opinion may be in the
10    form of an interpretive letter, no-objection letter, or other
11    issuance the Commissioner deems appropriate.
12        (b)  No  bank  or other person shall be liable under this
13    Act for any act done or omitted in good faith  in  conformity
14    with  any  rule,  interpretation,  or  opinion  issued by the
15    Commissioner of Banks and Real Estate,  notwithstanding  that
16    after the act or omission has occurred, the rule, opinion, or
17    interpretation  upon  which  reliance  is  placed is amended,
18    rescinded, or determined by judicial or other authority to be
19    invalid for any reason.
20    (Source: P.A. 90-161, eff. 7-23-97; 90-655, eff. 7-30-98.)

21        (205 ILCS 5/48.7 new)
22        Sec. 48.7.  Opinions  providing  State  banks  parity  in
23    regulation.  Notwithstanding  any  other provision of law, if
24    any regulation, rule, interpretation, procedure, or guideline
25    of the Comptroller  of  the  Currency,  the  Federal  Deposit
26    Insurance Corporation, the Federal Reserve Board, or the bank
27    regulatory  authority  of  any  other state puts a bank doing
28    business under the provisions of this Act at  a  disadvantage
29    to  a national bank, the Commissioner may issue an opinion or
30    interpretation that reduces or eliminates the disadvantage to
31    a bank doing business under this Act.
 
HB2538 Engrossed            -90-               LRB9201093JScs
 1        (205 ILCS 5/49) (from Ch. 17, par. 361)
 2        Sec. 49. False statements; penalty. It  is  unlawful  for
 3    any  officer,  director,  or  employee  of  any State bank or
 4    subsidiary or holding company of that bank or, after May  31,
 5    1997,   branch   out  of  an  out-of-state  bank  subject  to
 6    examination by the  Commissioner  or  any  person  filing  an
 7    application or notice or submitting information in connection
 8    with  an  application  or notice with the Commissioner to who
 9    shall willfully and knowingly subscribe to or make, or  cause
10    to be made, any false statement or false entry with intent to
11    deceive  any person or persons authorized to examine into the
12    affairs of the bank or the subsidiary or holding  company  of
13    that  bank,  or  the  branch  of an out-of-state bank, or the
14    applicant or with intent to deceive the Commissioner  or  his
15    administrative  officers  in  the performance of their duties
16    under this Act.  A person who violates this Section is,  upon
17    conviction thereof, shall be guilty of a Class 3 felony.
18    (Source: P.A. 89-208, eff. 9-29-95.)

19        (205 ILCS 5/51) (from Ch. 17, par. 363)
20        Sec. 51. Capital impairment, etc.; correction.
21        (a)  If  the  Commissioner  with  respect to a State bank
22    shall find:
23             (1)  its capital is impaired or it is  otherwise  in
24        an unsound condition; or
25             (2)  its business is being conducted in an unlawful,
26        including,   without  limitation,  in  violation  of  any
27        provisions of this Act, or  in  a  fraudulent  or  unsafe
28        manner; or
29             (3)  it is unable to continue operations; or
30             (4)  its examination has been obstructed or impeded;
31        the   Commissioner  may  give  notice  to  the  board  of
32        directors or his finding or findings. If the situation so
33        found by the Commissioner shall not be corrected  to  his
 
HB2538 Engrossed            -91-               LRB9201093JScs
 1        satisfaction  within  a  period  of at least sixty but no
 2        more than one hundred and eighty days  after  receipt  of
 3        such  notice,  which  period  shall  be determined by the
 4        Commissioner  and  set   forth   in   the   notice,   the
 5        Commissioner at the termination of said period shall take
 6        possession  and  control of the bank and its assets as in
 7        this  Act  provided  for  the  purpose  of   examination,
 8        reorganization or liquidation through receivership.
 9        (b)  If the Commissioner has given notice to the board of
10    directors of his findings, as provided in subsection (a), and
11    the  time  period  prescribed in that notice has expired, the
12    Commissioner may extend the time period  prescribed  in  that
13    notice for such period as the Commissioner deems appropriate.
14    (Source: P.A. 87-841.)

15        (205 ILCS 5/53) (from Ch. 17, par. 365)
16        Sec.   53.   Commissioner's   possession;   power.    The
17    Commissioner may take possession and control of a state  bank
18    and  its  assets,  by  posting  upon  the  premises  a notice
19    reciting that he is assuming possession pursuant to this Act,
20    and the time when his possession shall be deemed to commence,
21    which time shall not pre-date  the  posting  of  the  notice.
22    Promptly  after  taking  possession and control of a bank, if
23    the Federal Deposit Insurance Corporation is not appointed as
24    receiver, the Commissioner shall file a copy  of  the  notice
25    posted  upon  the premises in the circuit court in the county
26    in which the bank is located, and thereupon the clerk of such
27    court shall note the filing thereof upon the records  of  the
28    court,  and shall enter such cause as a court action upon the
29    dockets of such court under the name and  style  of  "In  the
30    matter  of  the possession and control of the Commissioner of
31    Banks and Real Estate of ...." (inserting the  name  of  such
32    bank), and thereupon the court wherein such cause is docketed
33    shall  be  vested with jurisdiction to hear and determine all
 
HB2538 Engrossed            -92-               LRB9201093JScs
 1    issues and  matters  pertaining  to  or  connected  with  the
 2    Commissioner's   possession  and  control  of  such  bank  as
 3    provided in this Act, and such  further  issues  and  matters
 4    pertaining to or connected with the Commissioner's possession
 5    and  control  as  may  be  submitted  to  such  court for its
 6    adjudication by the Commissioner.  When the Commissioner  has
 7    taken  possession  and  control  of a bank and its assets, he
 8    shall be vested  with  the  full  powers  of  management  and
 9    control,  including  without limiting the generality thereof,
10    the following:
11             (1)  the power to continue  or  to  discontinue  the
12        business;
13             (2)  the  power  to  stop or to limit the payment of
14        its obligations, provided,  however  with  respect  to  a
15        qualified financial contract between any party and a bank
16        or  banking  office,  the  branch  or agency of which the
17        Commissioner has  taken  possession  and  control,  which
18        party  has a perfected security interest in collateral or
19        other valid  lien  or  security  interest  in  collateral
20        enforceable  against third parties pursuant to a security
21        arrangement related to that qualified financial contract,
22        the party may retain  all  of  the  collateral  and  upon
23        repudiation  or  termination  of that qualified financial
24        contract  in  accordance  with  its   terms   apply   the
25        collateral  in  satisfaction of any claims secured by the
26        collateral; in no event shall the total amount so applied
27        exceed the global net payment obligation, if any;
28             (3)  the power to collect and to use its assets  and
29        to give valid receipts and acquittances therefor;
30             (4)  the  power  to  employ and to pay any necessary
31        assistants;
32             (5)  the power to execute any instrument in the name
33        of the bank;
34             (6)  the power to commence, defend  and  conduct  in
 
HB2538 Engrossed            -93-               LRB9201093JScs
 1        its  name  any  action or proceeding in which it may be a
 2        party;
 3             (7)  the power, upon the order of the court, to sell
 4        and convey its assets in whole or in part, and to sell or
 5        compound bad  or  doubtful  debts  upon  such  terms  and
 6        conditions as may be fixed in such order;
 7             (8)  the power, upon the order of the court, to make
 8        and  to carry out agreements with other banks or with the
 9        United States or any  agency  thereof  which  shall  have
10        insured the bank's deposits, in whole or in part, for the
11        payment or assumption of the bank's liabilities, in whole
12        or   in   part,  and  to  transfer  assets  and  to  make
13        guaranties, in whole or in part, and to  transfer  assets
14        and to make guaranties in connection therewith;
15             (9)  the  power,  upon  the  order  of the court, to
16        borrow money in the name of the bank and  to  pledge  its
17        assets as security for the loan;
18             (10)  the  power  to  terminate  his  possession and
19        control by restoring the bank to its board of directors;
20             (11)  the power to reorganize the bank  as  provided
21        in this Act;
22             (12)  the  power  to appoint a receiver and to order
23        liquidation of the bank as provided in this Act; and
24             (13)  the power, upon the order  of  the  court  and
25        without  the appointment of a receiver, to determine that
26        the bank has been closed for the purpose  of  liquidation
27        without  adequate provision being made for payment of its
28        depositors, and thereupon the bank  shall  be  deemed  to
29        have  been  closed  on  account  of inability to meet the
30        demands of its depositors.
31        As  soon  as  practical  after  taking  possession,   the
32    Commissioner  shall  make his examination of the condition of
33    the bank and an inventory of  the  assets.  Unless  the  time
34    shall  be  extended  by  order  of  the court and, unless the
 
HB2538 Engrossed            -94-               LRB9201093JScs
 1    Commissioner shall have otherwise settled the  affairs  of  a
 2    bank   pursuant  to  the  provisions  of  this  Act,  at  the
 3    termination of thirty days from the time of taking possession
 4    and control  of  a  bank  for  the  purpose  of  examination,
 5    reorganization   or  liquidation  through  receivership,  the
 6    Commissioner  shall  either  terminate  his  possession   and
 7    control  by  restoring  the bank to its board of directors or
 8    appoint a receiver and order the liquidation of the  bank  as
 9    provided  in  this Act. All necessary and reasonable expenses
10    of the Commissioner's  possession  and  control  and  of  its
11    reorganization  shall be borne by the bank and may be paid by
12    the Commissioner from its  assets.  If  the  Federal  Deposit
13    Insurance  Corporation  is  appointed  by the Commissioner as
14    receiver of a State bank, or the  Federal  Deposit  Insurance
15    Corporation   takes   possession  of  such  State  bank,  the
16    receivership proceedings and the powers  and  duties  of  the
17    Federal  Deposit  Insurance  Corporation shall be governed by
18    the Federal Deposit Insurance Act and regulations promulgated
19    thereunder rather than the provisions of this Act.
20    (Source: P.A. 89-364, eff. 8-18-95; 89-508, eff. 7-3-96.)

21        Section 15.  The Illinois Bank  Holding  Company  Act  of
22    1957 is amended by changing Section 3.074 as follows:

23        (205 ILCS 10/3.074) (from Ch. 17, par. 2510.04)
24        Sec. 3.074.  Powers; administrative review.
25        (a)  The Commissioner shall have the power and authority:
26             (1)  (a)  to  promulgate reasonable procedural rules
27        for the purposes of administering the provisions of  this
28        Act.   The  Commissioner  shall  specify  the form of any
29        application, report or document that is  required  to  be
30        filed with the Commissioner pursuant to this Act;
31             (2)   (b)  to   issue  orders  for  the  purpose  of
32        administering the provisions of this  Act  and  any  rule
 
HB2538 Engrossed            -95-               LRB9201093JScs
 1        promulgated in accordance with this Act;
 2             (3)  (c)  to appoint hearing officers to execute any
 3        of the powers granted  to  the  Commissioner  under  this
 4        Section  for the purpose of administering this Act or any
 5        rule promulgated in accordance with this Act; and
 6             (4) (d)  to  subpoena  witnesses,  to  compel  their
 7        attendance,  to administer an oath, to examine any person
 8        under oath and to require the production of any  relevant
 9        books,  papers,  accounts  and documents in the course of
10        and  pursuant  to  any  investigation  or  hearing  being
11        conducted or any action being taken by  the  Commissioner
12        in  respect  to any matter relating to the duties imposed
13        upon or the powers vested in the Commissioner  under  the
14        provisions  of  this  Act  or  any  rule  promulgated  in
15        accordance with this Act.; and
16        (b)  Whenever,  in  the  opinion of the Commissioner, any
17    director, officer, employee, or agent  of  any  bank  holding
18    company or subsidiary or affiliate of that company shall have
19    violated  any  law,  rule,  or  order  relating  to that bank
20    holding company or subsidiary or affiliate of  that  company,
21    shall   have   obstructed   or  impeded  any  examination  or
22    investigation by the Commissioner, shall   have  engaged   in
23    an   unsafe  or unsound  practice  in conducting the business
24    of that bank holding company or subsidiary  or  affiliate  of
25    that  company,  or shall have  violated any law or engaged or
26    participated  in   any   unsafe   or   unsound  practice   in
27    connection with any financial institution or  other  business
28    entity  such  that the character and fitness of the director,
29    officer,  employee,  or  agent  does  not  assure  reasonable
30    promise of safe and  sound  operation  of  the  bank  holding
31    company, the Commissioner may issue an order of removal.  If,
32    in  the  opinion  of  the  Commissioner, any former director,
33    officer, employee, or agent of  a  bank  holding  company  or
34    subsidiary  or  affiliate  of  that  company,  prior  to  the
 
HB2538 Engrossed            -96-               LRB9201093JScs
 1    termination  of  his or her service with that holding company
 2    or subsidiary or affiliate of that company, violated any law,
 3    rule, or order relating  to  that  bank  holding  company  or
 4    subsidiary  or  affiliate  of  that  company,  obstructed  or
 5    impeded any examination or investigation by the Commissioner,
 6    engaged  in  an  unsafe or unsound practice in conducting the
 7    business of  that  bank  holding  company  or  subsidiary  or
 8    affiliate  of  that company, or violated any law  or  engaged
 9    or  participated  in  any  unsafe  or  unsound  practice   in
10    connection with any financial  institution  or other business
11    entity  such  that the character and fitness of the director,
12    officer,  employee,  or  agent  would   not    have   assured
13    reasonable  promise  of  safe and sound operation of the bank
14    holding  company,  the  Commissioner  may  issue   an   order
15    prohibiting  that  person  from  further  service with a bank
16    holding company or subsidiary or affiliate of that company as
17    a director, officer, employee, or agent.
18        An order issued pursuant  to  this  subsection  shall  be
19    served upon the director, officer, employee, or agent. A copy
20    of  the  order  shall  be  sent  to each director of the bank
21    holding company  affected  by  registered  mail.  The  person
22    affected by the action may request a hearing before the State
23    Banking Board within 10 days after receipt of the order.  The
24    hearing  shall  be  held by the State Banking Board within 30
25    days after the request has been received by the State Banking
26    Board. The State Banking Board  shall  make  a  determination
27    approving,  modifying,  or  disapproving   the  order  of the
28    Commissioner as  its  final  administrative  decision.  If  a
29    hearing is held by the State Banking Board, the State Banking
30    Board  shall  make  its determination within 60 days from the
31    conclusion of the hearing. Any person affected by a  decision
32    of the State Banking Board under this subsection may have the
33    decision  reviewed  only  under  and  in  accordance with the
34    Administrative Review Law  and  the  rules  adopted  pursuant
 
HB2538 Engrossed            -97-               LRB9201093JScs
 1    thereto.  A  copy  of the order shall also be served upon the
 2    bank holding company of which  he  is  a  director,  officer,
 3    employee,  or  agent,  whereupon  he  shall  cease  to  be  a
 4    director,  officer,  employee,  or agent of that bank holding
 5    company.
 6        The Commissioner may institute a civil action against the
 7    director, officer, employee, or agent  of  the  bank  holding
 8    company,   against  whom  any  order  provided  for  by  this
 9    subsection has been issued, to enforce compliance with or  to
10    enjoin any violation of the terms of the order.
11        Any  person  who  has  been  the  subject  of an order of
12    removal or an order of prohibition issued by the Commissioner
13    under this subsection, subdivision (7) of Section 48  of  the
14    Illinois  Banking  Act,  or  Section  5-6  of  the  Corporate
15    Fiduciary  Act may not thereafter serve as director, officer,
16    employee, or agent of any holding  company,  State  bank,  or
17    branch  of any out-of-state bank, of any corporate fiduciary,
18    as defined in Section 1-5.05 of the Corporate Fiduciary  Act,
19    or  of  any  other  entity  that  is  subject to licensure or
20    regulation by the Commissioner or the  Office  of  Banks  and
21    Real   Estate  unless  the  Commissioner  has  granted  prior
22    approval in writing.
23        (c)  (e)  All  final  administrative  decisions  of   the
24    Commissioner  under  this  Act  shall  be subject to judicial
25    review pursuant to provisions of  the  Administrative  Review
26    Law. For matters involving administrative review, venue shall
27    be in either Sangamon County or Cook County.
28    (Source: P.A. 86-754.)

29        Section 20.  The Illinois Savings and Loan Act of 1985 is
30    amended  by  changing Sections 1-6, 2B-2, 2B-5, 3-8, and 5-16
31    and adding Sections 7-3.2 and 7-3.3 as follows:

32        (205 ILCS 105/1-6) (from Ch. 17, par. 3301-6)
 
HB2538 Engrossed            -98-               LRB9201093JScs
 1        Sec. 1-6.   General  corporate  powers.   An  association
 2    operating  under  this  Act  shall  be  a  body corporate and
 3    politic and shall have all of the powers  conferred  by  this
 4    Act including, but not limited to, the following powers:
 5        (a)  To  sue  and  be  sued,  complain  and defend in its
 6    corporate name, and to have a common seal, which it may alter
 7    or renew at pleasure;
 8        (b)  To   obtain   and   maintain   insurance   of    the
 9    association's    withdrawable   capital   by   an   insurance
10    corporation as defined in this Act;
11        (c)  Notwithstanding anything to the  contrary  contained
12    in  this  Act,  to  become  a member of the Federal Home Loan
13    Bank, and to have all of the powers granted to a  savings  or
14    thrift  institution  organized  under  the laws of the United
15    States and which is located and doing business in  the  State
16    of Illinois, subject to regulations of the Commissioner;
17        (d)  To  act as a fiscal agent for the United States, the
18    State of Illinois or any department, branch, arm or agency of
19    the State or any unit of local government or school  district
20    in  the  State  when duly designated for that purpose, and as
21    agent to perform the reasonable functions as may be  required
22    of it;
23        (e)  To  become  a member of or deal with any corporation
24    or agency of the United States or the State of  Illinois,  to
25    the   extent   that  the  agency  assists  in  furthering  or
26    facilitating the association's purposes or powers and to that
27    end to purchase stock or securities thereof or deposit  money
28    therewith,  and  to  comply  with  any  other  conditions  of
29    membership or credit;
30        (f)  To  make  donations  in  reasonable  amounts for the
31    public welfare or for charitable,  scientific,  religious  or
32    educational purposes;
33        (g)  To  adopt  and  operate reasonable insurance, bonus,
34    profit  sharing,  and  retirement  plans  for  officers   and
 
HB2538 Engrossed            -99-               LRB9201093JScs
 1    employees;   likewise,   directors   who  are  not  officers,
 2    including,  but  not  limited  to,  advisory,  honorary,  and
 3    emeritus directors, may participate in those plans;
 4        (h)  To reject any application for membership, to  retire
 5    withdrawable  capital  by  enforced retirement as provided in
 6    this Act and the by-laws, and to limit  the  issuance  of  or
 7    payments   on  withdrawable  capital,  subject,  however,  to
 8    contractual obligations;
 9        (i)  To purchase stock in  service  corporations  and  to
10    invest in any form of indebtedness of any service corporation
11    as  defined  in  this  Act,  subject  to  regulations  of the
12    Commissioner;
13        (j)  To purchase stock of a corporation  whose  principal
14    purpose  is  to  operate  a  safe  deposit  company or escrow
15    service company;
16        (k)  To act as Trustee or  Custodian  under  the  Federal
17    Self-Employed  Individuals' Tax Retirement Act of 1962 or any
18    amendments thereto or any other retirement account and invest
19    any funds held in such capacity in a savings account  of  the
20    institution;
21        (l)  (Blank);
22        (m)  To  establish,  maintain  and  operate  terminals as
23    authorized by the Electronic Fund Transfer Act and by Section
24    5  of  the  Illinois   Banking   Act.    The   establishment,
25    maintenance,  operation  and location of such terminals shall
26    be subject to the approval of the Commissioner;
27        (n)  Subject to  the  approval  and  regulations  of  the
28    Commissioner,  an  association  may purchase or assume all or
29    any part of the assets or liabilities of an eligible  insured
30    bank;
31        (o)  To  purchase from a bank, as defined in Section 2 of
32    the Illinois Banking Act, an  insubstantial  portion  of  the
33    total  deposits  of an insured bank.  For the purpose of this
34    subparagraph, "insubstantial portion of the  total  deposits"
 
HB2538 Engrossed            -100-              LRB9201093JScs
 1    shall have the same meaning as provided in Section 5(d)(2)(D)
 2    of the Federal Deposit Insurance Act;
 3        (p)  To effect an acquisition of or conversion to another
 4    financial   institution   pursuant  to  Section  205  of  the
 5    Financial Institutions Reform, Recovery and  Enforcement  Act
 6    of 1989;
 7        (q)  To pledge its assets:
 8             (1)  to enable it to act as an agent for the sale of
 9        obligations of the United States;
10             (2)  to secure deposits;
11             (3)  to  secure  deposits of money whenever required
12        by the National Bankruptcy Act;
13             (4)  (Blank) to qualify under  Section  2-9  of  the
14        Corporate Fiduciary Act; and
15             (5)  to  secure  trust  funds  commingled  with  the
16        institution's funds, whether deposited by the institution
17        or  an  affiliate  of  the institution, as required under
18        Section 2-8 of the Corporate Fiduciary Act;
19        (r)  To provide temporary  periodic  service  to  persons
20    residing  in  a  bona  fide  nursing  home,  senior citizens'
21    retirement home, or long-term care facility;
22        (s)  To purchase for its own account shares of stock of a
23    bankers' bank, described in Section 13(b)(1) of the  Illinois
24    Banking  Act,  on the same terms and conditions as a bank may
25    purchase such shares.  In no event shall the total amount  of
26    such  stock  held  by  an  association  in such bankers' bank
27    exceed 10% of its capital and  surplus  (including  undivided
28    profits)  and  in  no event shall an association acquire more
29    than 5% of any class of voting securities  of  such  bankers'
30    bank;
31        (t)  To  effect  a conversion to a State bank pursuant to
32    the provisions of the Illinois Banking Act;
33        (u)  Subject to Article XLIV of  the  Illinois  Insurance
34    Code,  to  act  as  the  agent  for  any fire, life, or other
 
HB2538 Engrossed            -101-              LRB9201093JScs
 1    insurance company authorized by the  State  of  Illinois,  by
 2    soliciting  and  selling insurance and collecting premiums on
 3    policies issued by such company; and may receive for services
 4    so rendered such fees or commissions as may  be  agreed  upon
 5    between  the  said  association and the insurance company for
 6    which it may act as agent; provided, however,  that  no  such
 7    association shall in any case assume or guarantee the payment
 8    of  any  premium  on  insurance  policies  issued through its
 9    agency by its  principal;  and  provided  further,  that  the
10    association  shall  not  guarantee the truth of any statement
11    made by an assured in filing his application  for  insurance;
12    and
13        (v)  To  exercise  all  powers  necessary to qualify as a
14    trustee or custodian under federal or State law, however, the
15    authority to accept and execute  trusts  is  subject  to  the
16    Corporate  Fiduciary  Act  and  to  the  supervision of those
17    activities by the Commissioner.
18    (Source: P.A. 90-14, eff. 7-1-97; 90-41, eff. 10-1-97; 91-97,
19    eff. 7-9-99.)

20        (205 ILCS 105/2B-2) (from Ch. 17, par. 3302B-2)
21        Sec. 2B-2.  Notice of  filing  of  application;  hearing;
22    renewal of certificate.
23        (a)  Whenever  such  association  has  complied  with the
24    provisions of this Act, and  the  Commissioner  is  satisfied
25    that  such  association  and any subsidiary operating in this
26    State are is doing business according to  the  laws  of  this
27    State,  and  are  is  in  sound financial condition, he shall
28    authorize the association to publish in newspapers of general
29    circulation in the State of Illinois, notice of filing of its
30    application, provided that subsections  (a)  through  (e)  of
31    this   Section  shall  not  apply  in  the  case  of  merger,
32    consolidation, or purchase as set forth in paragraph  (c)  of
33    Section  2B-1.   Publication  in  the  manner  and  on  forms
 
HB2538 Engrossed            -102-              LRB9201093JScs
 1    prescribed  by the Commissioner in the county of the proposed
 2    office of the association shall be made  within  15  days  of
 3    authorization.
 4        (b)  Within  10 days following the date of publication of
 5    notice of application any association or  person  wishing  to
 6    object  to  any  application  filed  pursuant to Section 2B-1
 7    shall:
 8             (1)  file in triplicate, on forms prescribed by  the
 9        Commissioner,  its verified objections at the Springfield
10        Office of the Commissioner; and
11             (2)  serve the applicant or its attorney  of  record
12        with  a  copy of the objections and show proof of service
13        of said copy.
14        (c)  If   the   Commissioner   considers   the   verified
15    objections to be substantial, he shall so advise the objector
16    and the applicant within 15 calendar days  after  receipt  of
17    the  objections and shall issue notice of intent to conduct a
18    hearing on the application.  Such notice  shall  provide  for
19    public  examination of the application.  A determination that
20    an objection is substantial  shall  be  based  only  on  data
21    showing   undue   injury   to   properly  conducted  existing
22    associations or data disputing the propriety  of  information
23    set forth in the application, or both.
24        (d)  The   Commissioner  shall  conduct  a  hearing  upon
25    receipt of an objection filed  on  time  and  containing  the
26    following:
27             (1)  a summary of the reasons for the objection;
28             (2)  the  specific  matters  in  the  application to
29        which objection  is  raised  and  the  reasons  for  each
30        objection;
31             (3)  facts   supporting   the  objection,  including
32        relevant economic or financial data; and
33             (4)  adverse  effects  on  the  objector  which  may
34        result from approval of the application.
 
HB2538 Engrossed            -103-              LRB9201093JScs
 1        The time and place of said hearing shall  be  established
 2    by  the Commissioner and 20 days notice shall be given to all
 3    parties of  record.    The  hearing  shall  be  conducted  in
 4    conformance    with    administrative    hearing   procedures
 5    established pursuant to rules and regulations adopted by  the
 6    Commissioner.   A  transcript  of  any  such hearing shall be
 7    taken and made a part of the record in the matter.
 8        (e)  A certificate  of  authority  shall  not  be  issued
 9    unless  the Commissioner finds that a need exists for savings
10    and loan association services in the  community  or  area  of
11    operations  of  the  applicant  association and the applicant
12    association will satisfy said need or  that  the  association
13    can  be maintained without undue injury to properly conducted
14    existing associations.
15        (f)  Annually thereafter, upon the filing of  the  annual
16    statement herein provided for, if the Commissioner finds that
17    the  association  and  any subsidiary operating in this State
18    are is doing business in accordance with this Act and are  is
19    otherwise  in  sound  financial  condition,  he shall issue a
20    renewal of such certificate of Authority.
21    (Source: P.A. 86-210; 86-952.)

22        (205 ILCS 105/2B-5) (from Ch. 17, par. 3302B-5)
23        Sec. 2B-5.  Cancellation of  authority;  notice.   Should
24    the  Commissioner  find,  upon  examination, that any foreign
25    association or any subsidiary operating in Illinois does  not
26    conduct  its business in accordance with the law, or that the
27    affairs of any such  association  or  subsidiary  are  in  an
28    unsound  condition,  or if such association refuses to permit
29    examination to be made, he may cancel the authority  of  such
30    association  to do business in this State, and cause a notice
31    thereof to be sent to the home office of the association, and
32    to be published in at least one  newspaper  in  the  City  of
33    Springfield.  After  the publication of such notice, it shall
 
HB2538 Engrossed            -104-              LRB9201093JScs
 1    be unlawful for any agent of the association to  receive  any
 2    further  stock  deposits from members residing in this State,
 3    except payments on stock on which a loan has been taken.
 4    (Source: P.A. 85-1143.)

 5        (205 ILCS 105/3-8) (from Ch. 17, par. 3303-8)
 6        Sec. 3-8.  Access to  books  and  records;  communication
 7    with members.
 8        (a)  Every  member  or  holder  of capital shall have the
 9    right to inspect the books and  records  of  the  association
10    that   pertain  to  his  account.  Otherwise,  the  right  of
11    inspection and examination of the books and records shall  be
12    limited  as  provided  in this Act, and no other person shall
13    have access to the books and records or shall be entitled  to
14    a list of the members.
15        (b)  For the purpose of this Section, the term "financial
16    records"  means any original, any copy, or any summary of (i)
17    a document granting signature authority  over  a  deposit  or
18    account;  (ii)  a  statement, ledger card, or other record on
19    any deposit or account that shows each transaction in or with
20    respect to that account; (iii) a check, draft, or money order
21    drawn  on  an  association  or  issued  and  payable  by   an
22    association;  or  (iv)  any other item containing information
23    pertaining to any relationship established  in  the  ordinary
24    course  of  an  association's business between an association
25    and its customer, including  financial  statements  or  other
26    financial  information  provided  by  the member or holder of
27    capital.
28        (c)  This Section does not prohibit:
29             (1)  The  preparation,  examination,  handling,   or
30        maintenance  of  any  financial  records  by any officer,
31        employee, or agent of an association  having  custody  of
32        those  records  or  the examination of those records by a
33        certified public accountant engaged by the association to
 
HB2538 Engrossed            -105-              LRB9201093JScs
 1        perform an independent audit.;
 2             (2)  The examination of any financial records by, or
 3        the furnishing of financial records by an association to,
 4        any officer, employee, or agent of  the  Commissioner  of
 5        Banks and Real Estate, Federal Savings and Loan Insurance
 6        Corporation and its successors, Federal Deposit Insurance
 7        Corporation,   Resolution   Trust   Corporation  and  its
 8        successors,  Federal  Home  Loan  Bank  Board   and   its
 9        successors, Office of Thrift Supervision, Federal Housing
10        Finance  Board, Board of Governors of the Federal Reserve
11        System, any Federal Reserve Bank, or the  Office  of  the
12        Comptroller  of  the  Currency  for  use  solely  in  the
13        exercise  of  his  duties  as  an  officer,  employee, or
14        agent.;
15             (3)  The  publication   of   data   furnished   from
16        financial  records  relating  to  members  or  holders of
17        capital where  the  data  cannot  be  identified  to  any
18        particular member, holder of capital, or account.;
19             (4)  The making of reports or returns required under
20        Chapter 61 of the Internal Revenue Code of 1986.;
21             (5)  Furnishing  information concerning the dishonor
22        of any negotiable instrument permitted  to  be  disclosed
23        under the Uniform Commercial Code.;
24             (6)  The  exchange in the regular course of business
25        of (i) credit  information  between  an  association  and
26        other   associations   or   financial   institutions   or
27        commercial  enterprises,  directly  or through a consumer
28        reporting agency or (ii) financial records or information
29        derived from financial records between an association and
30        other   associations   or   financial   institutions   or
31        commercial enterprises for the purpose of conducting  due
32        diligence  pursuant  to  a purchase or sale involving the
33        association or assets or liabilities of the association.;
34             (7)  The   furnishing   of   information   to    the
 
HB2538 Engrossed            -106-              LRB9201093JScs
 1        appropriate   law   enforcement   authorities  where  the
 2        association reasonably believes it has been the victim of
 3        a crime.;
 4             (8)  The furnishing of information pursuant  to  the
 5        Uniform Disposition of Unclaimed Property Act.;
 6             (9)  The  furnishing  of information pursuant to the
 7        Illinois Income Tax  Act  and  the  Illinois  Estate  and
 8        Generation-Skipping Transfer Tax Act.;
 9             (10)  The  furnishing of information pursuant to the
10        federal  "Currency  and  Foreign  Transactions  Reporting
11        Act", (Title 31, United  States  Code,  Section  1051  et
12        seq.).;
13             (11)  The  furnishing of information pursuant to any
14        other  statute  that  by  its  terms  or  by  regulations
15        promulgated  thereunder  requires   the   disclosure   of
16        financial   records  other  than  by  subpoena,  summons,
17        warrant, or court order.;
18             (12)  The  exchange  of   information   between   an
19        association  and an affiliate of the association; as used
20        in  this  item,   "affiliate"   includes   any   company,
21        partnership, or organization that controls, is controlled
22        by, or is under common control with an association.
23             (13)  The  furnishing  of  information in accordance
24        with  the  federal  Personal  Responsibility   and   Work
25        Opportunity  Reconciliation Act of 1996.  Any association
26        governed by this Act shall enter into  an  agreement  for
27        data  exchanges  with  a  State agency provided the State
28        agency pays to the association a reasonable  fee  not  to
29        exceed   its   actual   cost  incurred.   An  association
30        providing information in accordance with this item  shall
31        not  be  liable to any account holder or other person for
32        any disclosure of information  to  a  State  agency,  for
33        encumbering  or  surrendering  any  assets  held  by  the
34        association  in  response  to a lien or order to withhold
 
HB2538 Engrossed            -107-              LRB9201093JScs
 1        and deliver issued by a State agency, or  for  any  other
 2        action  taken pursuant to this item, including individual
 3        or  mechanical  errors,  provided  the  action  does  not
 4        constitute gross negligence  or  willful  misconduct.  An
 5        association  shall  have no obligation to hold, encumber,
 6        or surrender assets until  it  has  been  served  with  a
 7        subpoena,   summons,  warrant,  court  or  administrative
 8        order, lien, or levy.
 9             (14)  The   furnishing   of   information   to   law
10        enforcement authorities, the Illinois Department on Aging
11        and its regional administrative  and  provider  agencies,
12        the  Department  of  Human  Services  Office of Inspector
13        General, or public guardians, if the association suspects
14        that a customer who is an elderly or disabled person  has
15        been  or may become the victim of financial exploitation.
16        For the  purposes  of  this  item  (14),  the  term:  (i)
17        "elderly  person"  means a person who is 60 or more years
18        of age, (ii) "disabled person" means a person who has  or
19        reasonably  appears to the association to have a physical
20        or mental disability that impairs his or her  ability  to
21        seek  or  obtain  protection  from  or  prevent financial
22        exploitation, and (iii)  "financial  exploitation"  means
23        tortious  or illegal use of the assets or resources of an
24        elderly  or  disabled  person,  and   includes,   without
25        limitation,  misappropriation  of the elderly or disabled
26        person's assets or resources by undue  influence,  breach
27        of    fiduciary    relationship,   intimidation,   fraud,
28        deception, extortion, or the use of assets  or  resources
29        in  any  manner contrary to law. An association or person
30        furnishing information pursuant to this item  (14)  shall
31        be  entitled  to  the  same  rights  and protections as a
32        person furnishing information under the Elder  Abuse  and
33        Neglect  Act  and  the  Illinois Domestic Violence Act of
34        1986.
 
HB2538 Engrossed            -108-              LRB9201093JScs
 1             (15)  The  disclosure  of   financial   records   or
 2        information   as  necessary  to  effect,  administer,  or
 3        enforce a transaction  requested  or  authorized  by  the
 4        member or holder of capital, or in connection with:
 5                  (A)  servicing   or   processing   a  financial
 6             product or service requested or  authorized  by  the
 7             member or holder of capital;
 8                  (B)  maintaining  or  servicing an account of a
 9             member or holder of capital with the association; or
10                  (C)  a proposed  or  actual  securitization  or
11             secondary  market sale (including sales of servicing
12             rights) related to a  transaction  of  a  member  or
13             holder of capital.
14             Nothing  in  this item (15), however, authorizes the
15        sale of the financial records or information of a  member
16        or holder of capital without the consent of the member or
17        holder of capital.
18             (16)  The   disclosure   of   financial  records  or
19        information as necessary to protect  against  or  prevent
20        actual  or  potential  fraud,  unauthorized transactions,
21        claims, or other liability.
22        (d)  An association  may  not  disclose  to  any  person,
23    except  to  the  member  or  holder  of  capital  or his duly
24    authorized agent, any  financial  records  relating  to  that
25    member or holder of capital of that association unless:
26             (1)  The  member or holder of capital has authorized
27        disclosure to the person; or
28             (2)  The financial records are disclosed in response
29        to a lawful subpoena, summons, warrant,  or  court  order
30        that  meets  the  requirements  of subsection (e) of this
31        Section.
32        (e)  An  association  shall  disclose  financial  records
33    under subsection (d) of this Section  pursuant  to  a  lawful
34    subpoena,  summons,  warrant,  or  court order only after the
 
HB2538 Engrossed            -109-              LRB9201093JScs
 1    association mails a copy of the subpoena,  summons,  warrant,
 2    or  court  order  to the person establishing the relationship
 3    with the association, if living, and, otherwise, his personal
 4    representative, if known, at his last known address by  first
 5    class  mail,  postage  prepaid,  unless  the  association  is
 6    specifically  prohibited  from notifying that person by order
 7    of court.
 8        (f) (1)  Any officer or employee of  an  association  who
 9    knowingly   and  willfully  furnishes  financial  records  in
10    violation of this Section is guilty  of  a  business  offense
11    and, upon conviction, shall be fined not more than $1,000.
12        (2)  Any  person  who  knowingly and willfully induces or
13    attempts to induce any officer or employee of an  association
14    to disclose financial records in violation of this Section is
15    guilty  of  a business offense and, upon conviction, shall be
16    fined not more than $1,000.
17        (g)  However, if any member desires to  communicate  with
18    the  other  members  of the association with reference to any
19    question pending or to be  presented  at  a  meeting  of  the
20    members,  the  association  shall  give  him  upon  request a
21    statement of the approximate number of  members  entitled  to
22    vote  at the meeting and an estimate of the cost of preparing
23    and mailing the communication.  The  requesting  member  then
24    shall submit the communication to the Commissioner who, if he
25    finds it to be appropriate and truthful, shall direct that it
26    be  prepared  and  mailed  to the members upon the requesting
27    member's payment or adequate provision  for  payment  of  the
28    expenses of preparation and mailing.
29        (h)  An  association  shall  be reimbursed for costs that
30    are  necessary  and  that  have  been  directly  incurred  in
31    searching for, reproducing, or  transporting  books,  papers,
32    records,   or  other  data  of  a  customer  required  to  be
33    reproduced pursuant to a lawful subpoena, warrant,  or  court
34    order.
 
HB2538 Engrossed            -110-              LRB9201093JScs
 1    (Source: P.A. 90-18, eff. 7-1-97; 91-929, eff. 12-15-00.)

 2        (205 ILCS 105/5-16) (from Ch. 17, par. 3305-16)
 3        Sec. 5-16.  Limitation on loans to a single borrower.
 4    Except for loans to its wholly owned service corporations, an
 5    association  may  not  at  any  one  time  hold,  directly or
 6    indirectly, loans to any one corporation or person in a total
 7    amount equal to or in excess  of  10%  of  the  association's
 8    total  withdrawable  accounts or an amount equal to the total
 9    net  worth  of  the  association,  whichever  is   less.   An
10    association   may  make  loans  to  a  wholly  owned  service
11    corporation in an amount equal to the association's net worth
12    or in an amount that exceeds an association's  net  worth  if
13    such  excess  amount is secured by collateral, of a type upon
14    which  the  association  itself  could  lend,  of   a   value
15    determined   in   accordance   with   rules  and  regulations
16    promulgated by the Commissioner.
17        (a)  In computing the total mortgage  loans  made  by  an
18    association  to  an  individual,  there shall be included all
19    mortgage loans made by the association to  a  partnership  or
20    other unincorporated association of which he is a member, the
21    unpaid  balance of mortgage loans made either for his benefit
22    or  for  the   benefit   of   such   partnership   or   other
23    unincorporated  association  and all mortgage loans to or for
24    the benefit of a corporation of which he owns or controls 25%
25    or more of the capital stock.
26        (b)  In computing the total mortgage  loans  made  by  an
27    association   to   a   partnership  or  other  unincorporated
28    association, there shall be included the  unpaid  balance  of
29    mortgage  loans to its individual members, the unpaid balance
30    of mortgage loans made for the benefit of such partnership or
31    other unincorporated association, or of any  member  thereof,
32    and  all  mortgage  loans  to  or  for  the  benefit  of  any
33    corporation   of  which  the  partnership  or  unincorporated
 
HB2538 Engrossed            -111-              LRB9201093JScs
 1    association, or any member thereof, owns or controls  25%  or
 2    more of the capital stock.
 3        (c)  In  computing  the  total  mortgage loans made by an
 4    association to a corporation, there  shall  be  included  the
 5    unpaid  balance of mortgage loans made for the benefit of the
 6    corporation and all mortgage loans to or for the  benefit  of
 7    any  individual  who  owns  or  controls  25%  or more of the
 8    capital stock of such corporation.
 9        (d)  This Section does not apply to  the  obligations  as
10    endorser,  whether with or without recourse, or as guarantor,
11    whether  conditional  or  unconditional,  of  negotiable   or
12    nonnegotiable   installment  consumer  paper  of  the  person
13    transferring the same  if  the  association's  files  or  the
14    knowledge  of its officers of the financial condition of each
15    maker of those obligations is reasonably adequate and  if  an
16    officer  of  the  association, designated for that purpose by
17    the board of directors of the association, certifies that the
18    responsibility of each maker  of  the  obligations  has  been
19    evaluated  and that the association is relying primarily upon
20    each  maker  for  the  payment  of  the   obligations.    The
21    certification  shall  be  in writing and shall be retained as
22    part of the records of the association.
23    (Source: P.A. 86-137.)

24        (205 ILCS 105/7-3.2 new)
25        Sec. 7-3.2.  Reliance on Commissioner.
26        (a)  The Commissioner may issue an opinion in response to
27    a specific request from a member of the public or the savings
28    association industry or on his own initiative.   The  opinion
29    may  be  in  the form of an interpretive letter, no-objection
30    letter, or other issuance the Commissioner deems appropriate.
31        (b)  If the Commissioner determines that the  opinion  is
32    useful   for   the   general   guidance   of  the  public  or
33    associations, the Commissioner may disseminate the opinion by
 
HB2538 Engrossed            -112-              LRB9201093JScs
 1    newsletter, via an electronic medium such as the internet, in
 2    a volume of statutes or related materials  published  by  the
 3    Commissioner   or   others,  or  by  other  means  reasonably
 4    calculated to notify persons  affected  by  the  opinion.   A
 5    published   opinion   must   be   redacted  to  preserve  the
 6    confidentiality of the requesting party unless the requesting
 7    party consents to be identified in the published opinion.
 8        (c)  No association or other person shall be liable under
 9    this Act for any  act  done  or  omitted  in  good  faith  in
10    conformity  with  any rule, interpretation, or opinion issued
11    by the Commissioner, notwithstanding that after  the  act  or
12    omission  has  occurred, the rule, opinion, or interpretation
13    upon which reliance  is  placed  is  amended,  rescinded,  or
14    determined  by  judicial or other authority to be invalid for
15    any reason.

16        (205 ILCS 105/7-3.3 new)
17        Sec. 7-3.3.  Opinions  providing  association  parity  in
18    regulation.    Notwithstanding any other provision of law, if
19    any regulation, rule, interpretation, procedure, or guideline
20    of the Comptroller  of  the  Currency,  the  Federal  Deposit
21    Insurance  Corporation,  the  Federal Reserve Board, the U.S.
22    Office of Thrift Supervision, or the  depository  institution
23    regulatory  authority  of any other state puts an association
24    doing  business  under  the  provisions  of  this  Act  at  a
25    disadvantage to a  federal  association  or  federal  savings
26    bank, the Commissioner may issue an opinion or interpretation
27    that reduces or eliminates the disadvantage to an association
28    doing business under this Act.

29        (205 ILCS 105/11-5 rep.)
30        Section 22.  The Illinois Savings and Loan Act of 1985 is
31    amended by repealing Section 11-5.
 
HB2538 Engrossed            -113-              LRB9201093JScs
 1        Section  25.  The Savings Bank Act is amended by changing
 2    Sections 1006, 1007.35, 1008, 4005, 4013, 6013, 8015,  10001,
 3    11003,  11004, and 11008 and adding Sections 5010 and 9019 as
 4    follows:

 5        (205 ILCS 205/1006) (from Ch. 17, par. 7301-6)
 6        Sec. 1006. Parity.
 7        (a)  Subject to the regulation of the Commissioner and in
 8    addition to the powers granted by  this  Act,   each  savings
 9    bank  operating  under  this  Act  shall possess those powers
10    granted by regulation promulgated under the  Federal  Deposit
11    Insurance Act for state savings banks.
12        (b)  A  savings bank may establish branches or offices at
13    which savings or investments are regularly received or  loans
14    approved as follows:
15             (1)  to  the  extent  branch  powers and offices are
16        granted to State banks under the Illinois Banking Act;
17             (2)  within the geographic area defined in Article 2
18        of this Act and subject to the provisions of Article 2 of
19        this Act;
20             (3)  within the same geographic areas or  states  as
21        those states from which a holding company is permitted to
22        acquire  an  Illinois savings bank or an Illinois savings
23        bank holding company;
24             (4)  to the same extent that holding  companies  and
25        savings  and  loan associations headquartered outside the
26        State of Illinois are allowed to operate in  Illinois  by
27        virtue  of Articles 1A and 2B of the Illinois Savings and
28        Loan Act of 1985;
29             (5)  as the result of  mergers,  consolidations,  or
30        bulk sales of facilities in the case of relocations.
31        (c)  The  Commissioner may adopt regulations that provide
32    for  the  establishment  of  branches  as  defined   by   the
33    Commissioner.
 
HB2538 Engrossed            -114-              LRB9201093JScs
 1        (d)  Notwithstanding  any  other provision of this Act, a
 2    savings bank that purchases or assumes all or any part of the
 3    assets or liabilities of a bank, savings bank, or savings and
 4    loan association or  merges  or  consolidates  with  a  bank,
 5    savings  bank, or savings and loan association may retain and
 6    maintain the main premises or branches of  the  former  bank,
 7    savings  bank, or savings and loan association as branches of
 8    the  purchasing,  merging,  or  consolidating  savings  bank,
 9    provided it assumes the  deposit  liabilities  of  the  bank,
10    savings  bank,  or savings and loan association maintained at
11    the main premises or branches.
12        (e)  A savings bank has any  power  reasonably  incident,
13    convenient,  or  useful  to  the accomplishment of the powers
14    conferred upon the savings bank by this Act.
15        (f)  Notwithstanding any other provision of law,  if  any
16    regulation,  rule, interpretation, procedure, or guideline of
17    the  Comptroller  of  the  Currency,  the   Federal   Deposit
18    Insurance  Corporation,  the  Federal Reserve Board, the U.S.
19    Office of Thrift Supervision, or the  depository  institution
20    regulatory  authority  of any other state puts a savings bank
21    doing  business  under  the  provisions  of  this  Act  at  a
22    disadvantage to a federal association, federal  savings  bank
23    or  a national bank, the Commissioner may issue an opinion or
24    interpretation that reduces or eliminates the disadvantage to
25    a savings bank doing business under this Act.
26    (Source: P.A.  89-74,  eff.  6-30-95;  90-301,  eff.  8-1-97;
27    90-665, eff. 7-30-98.)

28        (205 ILCS 205/1007.35) (from Ch. 17, par. 7301-7.35)
29        Sec. 1007.35.  "Control", unless specified  otherwise  in
30    this Act, shall mean:
31        (1)  the  ability  of  any  person,  entity,  persons, or
32    entities acting alone or in concert with one or more  persons
33    or  entities,  to own, hold, or direct with power to vote, or
 
HB2538 Engrossed            -115-              LRB9201093JScs
 1    to hold proxies representing,  10%  or  more  of  the  voting
 2    shares  or rights of a savings bank, savings bank subsidiary,
 3    savings bank affiliate, or savings bank holding company; or
 4        (2)  the ability to achieve in any manner the election or
 5    appointment of a majority  of  the  directors  of  a  savings
 6    bank.; or
 7        (3)  the   power   to   direct  or  exercise  significant
 8    influence over the management or policies of the savings bank
 9    or savings bank affiliate.
10        "Control" does not  include  This  definition  shall  not
11    apply  to  the  voting of proxies obtained from depositors if
12    the proxies are voted as directed by a majority of the  board
13    of  directors  of  the  savings  bank  or  of  a committee of
14    directors when the committee's composition and powers may  be
15    revoked by a majority vote of the board of directors.
16    (Source: P.A. 86-1213.)

17        (205 ILCS 205/1008) (from Ch. 17, par. 7301-8)
18        Sec. 1008. General corporate powers.
19        (a)  A  savings  bank operating under this Act shall be a
20    body corporate and politic and shall have all of  the  powers
21    conferred  by  this  Act  including,  but not limited to, the
22    following powers:
23             (1)  To sue and be sued, complain, and defend in its
24        corporate name and to have a common seal,  which  it  may
25        alter or renew at pleasure.
26             (2)  To  obtain  and maintain insurance by a deposit
27        insurance corporation as defined in this Act.
28             (3)  To act as a fiscal agent for the United States,
29        the State of Illinois or any department, branch, arm,  or
30        agency  of  the  State or any unit of local government or
31        school district in the State, when  duly  designated  for
32        that   purpose,   and  as  agent  to  perform  reasonable
33        functions as may be required of it.
 
HB2538 Engrossed            -116-              LRB9201093JScs
 1             (4)  To  become  a  member  of  or  deal  with   any
 2        corporation  or  agency of the United States or the State
 3        of Illinois, to the extent that  the  agency  assists  in
 4        furthering  or facilitating its purposes or powers and to
 5        that end to  purchase  stock  or  securities  thereof  or
 6        deposit  money  therewith,  and  to comply with any other
 7        conditions of membership or credit.
 8             (5)  To make donations in reasonable amounts for the
 9        public welfare or for charitable, scientific,  religious,
10        or educational purposes.
11             (6)  To  adopt  and  operate  reasonable  insurance,
12        bonus,  profit sharing, and retirement plans for officers
13        and  employees  and  for  directors  including,  but  not
14        limited to, advisory, honorary, and  emeritus  directors,
15        who are not officers or employees.
16             (7)  To  reject  any  application for membership; to
17        retire  deposit  accounts  by  enforced   retirement   as
18        provided  in  this  Act  and the bylaws; and to limit the
19        issuance of, or payments on, deposit  accounts,  subject,
20        however, to contractual obligations.
21             (8)  To  purchase  stock in service corporations and
22        to invest in any form  of  indebtedness  of  any  service
23        corporation   as   defined   in   this  Act,  subject  to
24        regulations of the Commissioner.
25             (9)  To  purchase  stock  of  a  corporation   whose
26        principal purpose is to operate a safe deposit company or
27        escrow service company.
28             (10)  To   exercise  all  the  powers  necessary  to
29        qualify as a trustee or custodian under federal or  State
30        law,  provided  that  the authority to accept and execute
31        trusts is subject to  the  provisions  of  the  Corporate
32        Fiduciary  Act and to the supervision of those activities
33        by the Commissioner.
34             (11)  (Blank).
 
HB2538 Engrossed            -117-              LRB9201093JScs
 1             (12)  To establish, maintain, and operate  terminals
 2        as authorized by the Electronic Fund Transfer Act.
 3             (13)  To pledge its assets:
 4                  (A)  to  enable it to act as agent for the sale
 5             of obligations of the United States;
 6                  (B)  to secure deposits;
 7                  (C)  to  secure  deposits  of  money   whenever
 8             required by the National Bankruptcy Act;
 9                  (D)  (blank)  to  qualify  under Section 2-9 of
10             the Corporate Fiduciary Act; and
11                  (E)  to secure trust funds commingled with  the
12             savings  bank's  funds,  whether  deposited  by  the
13             savings bank or an affiliate of the savings bank, as
14             required   under   Section   2-8  of  the  Corporate
15             Fiduciary Act.
16             (14)  To accept for payment at a future date not  to
17        exceed one year from the date of acceptance, drafts drawn
18        upon  it  by  its  customers;  and  to  issue, advise, or
19        confirm letters of credit authorizing holders thereof  to
20        draw drafts upon it or its correspondents.
21             (15)  Subject    to    the    regulations   of   the
22        Commissioner, to own and lease personal property acquired
23        by the savings bank  at  the  request  of  a  prospective
24        lessee  and,  upon the agreement of that person, to lease
25        the personal property.
26             (16)  To establish temporary service booths  at  any
27        International  Fair in this State that is approved by the
28        United States Department of Commerce for the duration  of
29        the  international  fair  for  the purpose of providing a
30        convenient place for foreign trade customers to  exchange
31        their   home   countries'  currency  into  United  States
32        currency or the converse.  To provide temporary  periodic
33        service  to persons residing in a bona fide nursing home,
34        senior  citizens'  retirement  home,  or  long-term  care
 
HB2538 Engrossed            -118-              LRB9201093JScs
 1        facility.   These  powers  shall  not  be  construed   as
 2        establishing  a  new  place or change of location for the
 3        savings bank providing the service booth.
 4             (17)  To   indemnify   its   officers,    directors,
 5        employees,  and  agents,  as  authorized for corporations
 6        under Section 8.75 of the Business  Corporations  Act  of
 7        1983.
 8             (18)  To  provide data processing services to others
 9        on a for-profit basis.
10             (19)  To  utilize  any  electronic   technology   to
11        provide customers with home banking services.
12             (20)  Subject    to    the    regulations   of   the
13        Commissioner, to enter into an  agreement  to  act  as  a
14        surety.
15             (21)  Subject    to    the    regulations   of   the
16        Commissioner,  to  issue  credit  cards,  extend   credit
17        therewith,  and  otherwise  engage  in  or participate in
18        credit card operations.
19             (22)  To purchase for  its  own  account  shares  of
20        stock  of  a bankers' bank, described in Section 13(b)(1)
21        of the Illinois  Banking  Act,  on  the  same  terms  and
22        conditions  as  a  bank  may purchase such shares.  In no
23        event shall the total amount of  such  stock  held  by  a
24        savings  bank  in  such  bankers'  bank exceed 10% of its
25        capital and surplus (including undivided profits) and  in
26        no event shall a savings bank acquire more than 5% of any
27        class of voting securities of such bankers' bank.
28             (23)  With respect to affiliate facilities:
29                  (A)  to  conduct at affiliate facilities any of
30             the following transactions for and on behalf of  any
31             affiliated  depository institution, if so authorized
32             by the affiliate or affiliates: receiving  deposits;
33             renewing   deposits;  cashing  and  issuing  checks,
34             drafts, money orders, travelers checks,  or  similar
 
HB2538 Engrossed            -119-              LRB9201093JScs
 1             instruments;  changing  money; receiving payments on
 2             existing indebtedness;  and  conducting  ministerial
 3             functions   with   respect   to  loan  applications,
 4             servicing  loans,   and   providing   loan   account
 5             information; and
 6                  (B)  to   authorize  an  affiliated  depository
 7             institution to conduct for and on behalf of it,  any
 8             of the transactions listed in this subsection at one
 9             or more affiliate facilities.
10             A  savings bank intending to conduct or to authorize
11        an affiliated depository institution  to  conduct  at  an
12        affiliate  facility  any of the transactions specified in
13        this  subsection  shall  give  written  notice   to   the
14        Commissioner at least 30 days before any such transaction
15        is conducted at an affiliate facility.  All conduct under
16        this  subsection  shall  be on terms consistent with safe
17        and sound banking practices and applicable law.
18             (24)  Subject  to  Article  XLIV  of  the   Illinois
19        Insurance  Code,  to act as the agent for any fire, life,
20        or other insurance company authorized  by  the  State  of
21        Illinois,   by   soliciting  and  selling  insurance  and
22        collecting premiums on policies issued by  such  company;
23        and  may  receive  for  services so rendered such fees or
24        commissions as  may  be  agreed  upon  between  the  said
25        savings  bank  and the insurance company for which it may
26        act as agent; provided, however,  that  no  such  savings
27        bank shall in any case assume or guarantee the payment of
28        any  premium  on  insurance  policies  issued through its
29        agency by its principal; and provided further,  that  the
30        savings  bank  shall  not  guarantee  the  truth  of  any
31        statement  made  by an assured in filing his  application
32        for insurance.
33             (25)  To become a member of the  Federal  Home  Loan
34        Bank  and  to  have  the  powers  granted  to  a  savings
 
HB2538 Engrossed            -120-              LRB9201093JScs
 1        association organized under the Illinois Savings and Loan
 2        Act  of 1985 or the laws of the United States, subject to
 3        regulations of the Commissioner.
 4             (26)  To offer any product or service that is at the
 5        time authorized or permitted to a bank by applicable law,
 6        but  subject  always  to   the   same   limitations   and
 7        restrictions  that  are  applicable  to  the bank for the
 8        product or service by such applicable law and subject  to
 9        the  applicable  provisions of the Financial Institutions
10        Insurance Sales Law and rules of the Commissioner.
11        (b)  If this Act or the regulations  adopted  under  this
12    Act fail to provide specific guidance in matters of corporate
13    governance, the provisions of the Business Corporation Act of
14    1983 may be used.
15    (Source:  P.A.  90-14,  eff.  7-1-97;  90-41,  eff.  10-1-97;
16    90-270,  eff.  7-30-97;  90-301,  eff.  8-1-97;  90-655, eff.
17    7-30-98; 90-665, eff. 7-30-98; 91-97,  eff.  7-9-99;  91-357,
18    eff. 7-29-99.)

19        (205 ILCS 205/4005) (from Ch. 17, par. 7304-5)
20        Sec. 4005. Voting.
21        (a)  Voting  at  a  meeting may be either in person or by
22    proxy executed in writing by the member or stockholder or  by
23    his duly authorized attorney-in-fact.
24        (b)  In  the  determination  of  all  questions requiring
25    ascertainment of who is entitled to vote and of the number of
26    outstanding shares, the following rules shall apply:
27             (1)  The date of determination shall be  the  record
28        date for voting provided in this Act.
29             (2)  Each  person  holding  one or more withdrawable
30        accounts in a mutual savings bank shall have the vote  of
31        one share for each $100 of the aggregate withdrawal value
32        of  the accounts and shall have the vote of one share for
33        any fraction of $100; however, subject to  regulation  of
 
HB2538 Engrossed            -121-              LRB9201093JScs
 1        the  Commissioner,  a  mutual  savings  bank  may  in its
 2        by-laws limit the number of votes a person  may  cast  to
 3        1,000  votes. A mutual savings bank may adopt a different
 4        voting arrangement if the  Commissioner  finds  that  the
 5        arrangement  would  not  be inequitable to members and if
 6        the members approve the  arrangement  by  an  affirmative
 7        vote  of  at least two-thirds of the votes entitled to be
 8        cast, however, the voting arrangement need not obtain the
 9        foregoing member approval if such voting  arrangement  is
10        otherwise  approved  as  part of a corporate change under
11        this Act.
12             (3)  Each holder of capital stock  held  shall  have
13        one vote for each share held.
14             (4)  Shares  owned  by the savings bank shall not be
15        counted or voted.
16             (5)  A savings bank authorized to issue stock  shall
17        provide  in  its  articles  of  incorporation that voting
18        rights shall may be vested exclusively in stockholders.
19    (Source: P.A. 91-97, eff. 7-9-99.)

20        (205 ILCS 205/4013) (from Ch. 17, par. 7304-13)
21        Sec. 4013.  Access to books  and  records;  communication
22    with members and shareholders.
23        (a)  Every  member or shareholder shall have the right to
24    inspect books and records of the savings bank that pertain to
25    his  accounts.   Otherwise,  the  right  of  inspection   and
26    examination  of  the  books  and  records shall be limited as
27    provided in this Act, and no other person shall  have  access
28    to  the  books and records nor shall be entitled to a list of
29    the members or shareholders.
30        (b)  For the purpose of this Section, the term "financial
31    records" means any original, any copy, or any summary of  (1)
32    a  document  granting  signature  authority over a deposit or
33    account; (2) a statement, ledger card, or other record on any
 
HB2538 Engrossed            -122-              LRB9201093JScs
 1    deposit or account that shows each  transaction  in  or  with
 2    respect  to  that account; (3) a check, draft, or money order
 3    drawn on a savings bank or issued and payable  by  a  savings
 4    bank; or (4) any other item containing information pertaining
 5    to  any  relationship established in the ordinary course of a
 6    savings bank's  business  between  a  savings  bank  and  its
 7    customer,  including  financial statements or other financial
 8    information provided by the member or shareholder.
 9        (c)  This Section does not prohibit:
10             (1)  The  preparation  examination,   handling,   or
11        maintenance  of  any  financial   records by any officer,
12        employee, or agent of a savings bank  having  custody  of
13        records  or  examination of records by a certified public
14        accountant engaged by the  savings  bank  to  perform  an
15        independent audit.
16             (2)  The examination of any financial records by, or
17        the furnishing of financial records by a savings bank to,
18        any  officer,  employee,  or agent of the Commissioner of
19        Banks and Real Estate or the  Federal  Deposit  Insurance
20        Corporation  for use solely in the exercise of his duties
21        as an officer, employee, or agent.
22             (3)  The  publication   of   data   furnished   from
23        financial  records  relating  to  members  or  holders of
24        capital where  the  data  cannot  be  identified  to  any
25        particular member, shareholder, or account.
26             (4)  The making of reports or returns required under
27        Chapter 61 of the Internal Revenue Code of 1986.
28             (5)  Furnishing  information concerning the dishonor
29        of any negotiable instrument permitted  to  be  disclosed
30        under the Uniform Commercial Code.
31             (6)  The  exchange in the regular course of business
32        of (i) credit information  between  a  savings  bank  and
33        other   savings   banks   or  financial  institutions  or
34        commercial enterprises, directly or  through  a  consumer
 
HB2538 Engrossed            -123-              LRB9201093JScs
 1        reporting agency or (ii) financial records or information
 2        derived from financial records between a savings bank and
 3        other   savings   banks   or  financial  institutions  or
 4        commercial enterprises for the purpose of conducting  due
 5        diligence  pursuant  to  a purchase or sale involving the
 6        savings bank or assets  or  liabilities  of  the  savings
 7        bank.
 8             (7)  The    furnishing   of   information   to   the
 9        appropriate law enforcement authorities where the savings
10        bank reasonably believes it has  been  the  victim  of  a
11        crime.
12             (8)  The  furnishing  of information pursuant to the
13        Uniform Disposition of Unclaimed Property Act.
14             (9)  The furnishing of information pursuant  to  the
15        Illinois  Income  Tax  Act  and  the  Illinois Estate and
16        Generation-Skipping Transfer Tax Act.
17             (10)  The furnishing of information pursuant to  the
18        federal  "Currency  and  Foreign  Transactions  Reporting
19        Act",  (Title  31,  United  States  Code, Section 1051 et
20        seq.).
21             (11)  The furnishing of information pursuant to  any
22        other  statute  which  by  its  terms  or  by regulations
23        promulgated  thereunder  requires   the   disclosure   of
24        financial   records  other  than  by  subpoena,  summons,
25        warrant, or court order.
26             (12)  The furnishing of  information  in  accordance
27        with   the   federal  Personal  Responsibility  and  Work
28        Opportunity Reconciliation Act of 1996. Any savings  bank
29        governed  by  this  Act shall enter into an agreement for
30        data exchanges with a State  agency  provided  the  State
31        agency  pays  to the savings bank a reasonable fee not to
32        exceed  its  actual  cost  incurred.   A   savings   bank
33        providing  information in accordance with this item shall
34        not be liable to any account holder or other  person  for
 
HB2538 Engrossed            -124-              LRB9201093JScs
 1        any  disclosure  of  information  to  a State agency, for
 2        encumbering  or  surrendering  any  assets  held  by  the
 3        savings bank in response to a lien or order  to  withhold
 4        and  deliver  issued  by a State agency, or for any other
 5        action taken pursuant to this item, including  individual
 6        or  mechanical  errors,  provided  the  action  does  not
 7        constitute  gross  negligence  or  willful misconduct.  A
 8        savings bank shall have no obligation to hold,  encumber,
 9        or  surrender  assets  until  it  has  been served with a
10        subpoena,  summons,  warrant,  court  or   administrative
11        order, lien, or levy.
12             (13)  The   furnishing   of   information   to   law
13        enforcement authorities, the Illinois Department on Aging
14        and  its  regional  administrative and provider agencies,
15        the Department of  Human  Services  Office  of  Inspector
16        General,   or  public  guardians,  if  the  savings  bank
17        suspects that a customer who is an  elderly  or  disabled
18        person  has  been  or  may become the victim of financial
19        exploitation. For the purposes of  this  item  (13),  the
20        term:  (i)  "elderly  person" means a person who is 60 or
21        more years of age, (ii) "disabled person" means a  person
22        who has or reasonably appears to the savings bank to have
23        a  physical  or mental disability that impairs his or her
24        ability to seek or  obtain  protection  from  or  prevent
25        financial     exploitation,    and    (iii)    "financial
26        exploitation" means tortious or illegal use of the assets
27        or resources  of  an  elderly  or  disabled  person,  and
28        includes,  without  limitation,  misappropriation  of the
29        elderly or disabled person's assets or resources by undue
30        influence,    breach    of    fiduciary     relationship,
31        intimidation,  fraud, deception, extortion, or the use of
32        assets or resources in any  manner  contrary  to  law.  A
33        savings bank or person furnishing information pursuant to
34        this  item  (13) shall be entitled to the same rights and
 
HB2538 Engrossed            -125-              LRB9201093JScs
 1        protections as a person furnishing information under  the
 2        Elder  Abuse  and  Neglect  Act and the Illinois Domestic
 3        Violence Act of 1986.
 4             (14)  The  disclosure  of   financial   records   or
 5        information   as  necessary  to  effect,  administer,  or
 6        enforce a transaction  requested  or  authorized  by  the
 7        member or holder of capital, or in connection with:
 8                  (A)  servicing   or   processing   a  financial
 9             product or service requested or  authorized  by  the
10             member or holder of capital;
11                  (B)  maintaining  or  servicing an account of a
12             member or holder of capital with the  savings  bank;
13             or
14                  (C)  a  proposed  or  actual  securitization or
15             secondary market sale (including sales of  servicing
16             rights)  related  to  a  transaction  of a member or
17             holder of capital.
18             Nothing in this item (14), however,  authorizes  the
19        sale  of the financial records or information of a member
20        or holder of capital without the consent of the member or
21        holder of capital.
22             (15)  The exchange in the regular course of business
23        of information between a savings bank  and  any  commonly
24        owned  affiliate  of  the  savings  bank,  subject to the
25        provisions of the Financial Institutions Insurance  Sales
26        Law.
27             (16)  The   disclosure   of   financial  records  or
28        information as necessary to protect  against  or  prevent
29        actual  or  potential  fraud,  unauthorized transactions,
30        claims, or other liability.
31        (d)  A savings bank  may  not  disclose  to  any  person,
32    except  to  the  member  or  holder  of  capital  or his duly
33    authorized agent, any  financial  records  relating  to  that
34    member or shareholder of the savings bank unless:
 
HB2538 Engrossed            -126-              LRB9201093JScs
 1             (1)  the   member   or  shareholder  has  authorized
 2        disclosure to the person; or
 3             (2)  the financial records are disclosed in response
 4        to a lawful subpoena, summons, warrant,  or  court  order
 5        that  meets  the  requirements  of subsection (e) of this
 6        Section.
 7        (e)  A savings  bank  shall  disclose  financial  records
 8    under  subsection  (d)  of  this Section pursuant to a lawful
 9    subpoena, summons, warrant, or court  order  only  after  the
10    savings  bank mails a copy of the subpoena, summons, warrant,
11    or court order to the person  establishing  the  relationship
12    with the savings bank, if living, and otherwise, his personal
13    representative,  if known, at his last known address by first
14    class mail, postage  prepaid,  unless  the  savings  bank  is
15    specifically prohibited from notifying the person by order of
16    court.
17        (f)  Any  officer  or  employee  of  a  savings  bank who
18    knowingly  and  willfully  furnishes  financial  records   in
19    violation  of  this  Section  is guilty of a business offense
20    and, upon conviction, shall be fined not more than $1,000.
21        (g)  Any person who knowingly and  willfully  induces  or
22    attempts  to induce any officer or employee of a savings bank
23    to disclose financial records in violation of this Section is
24    guilty of a business offense and, upon conviction,  shall  be
25    fined not more than $1,000.
26        (h)  If  any member or shareholder desires to communicate
27    with the other members or shareholders of  the  savings  bank
28    with  reference to any question pending or to be presented at
29    an annual or special meeting, the  savings  bank  shall  give
30    that  person,  upon  request,  a statement of the approximate
31    number of members or shareholders entitled  to  vote  at  the
32    meeting  and an estimate of the cost of preparing and mailing
33    the communication.  The requesting member  shall  submit  the
34    communication  to the Commissioner who, upon finding it to be
 
HB2538 Engrossed            -127-              LRB9201093JScs
 1    appropriate and truthful, shall direct that  it  be  prepared
 2    and  mailed  to  the  members upon the requesting member's or
 3    shareholder's payment or adequate provision  for  payment  of
 4    the expenses of preparation and mailing.
 5        (i)  A  savings  bank  shall be reimbursed for costs that
 6    are  necessary  and  that  have  been  directly  incurred  in
 7    searching for, reproducing, or  transporting  books,  papers,
 8    records,   or  other  data  of  a  customer  required  to  be
 9    reproduced pursuant to a lawful subpoena, warrant,  or  court
10    order.
11        (j)  Notwithstanding  the  provisions  of this Section, a
12    savings bank may sell or  otherwise  make  use  of  lists  of
13    customers'   names  and  addresses.   All  other  information
14    regarding a customer's account are subject to the  disclosure
15    provisions  of this Section.  At the request of any customer,
16    that customer's name and address shall be  deleted  from  any
17    list  that  is  to be sold or used in any other manner beyond
18    identification of the customer's accounts.
19    (Source: P.A. 90-18, eff. 7-1-97; 91-929, eff. 12-15-00.)

20        (205 ILCS 205/5010 new)
21        Sec. 5010.  Final judgment required.  Except in an action
22    brought  by  the  Commissioner  or  the   deposit   insurance
23    corporation,  and any other provision of law notwithstanding,
24    no attachment, injunction, or execution that would  have  the
25    effect  of  reducing  the  capital  of any savings bank below
26    applicable minimum regulatory requirements  shall  be  issued
27    against any savings bank or its property in any suit, action,
28    or  proceeding in any court before final judgment, from which
29    no appeal can be taken, is rendered.

30        (205 ILCS 205/6013) (from Ch. 17, par. 7306-13)
31        Sec. 6013. Loans to one borrower.
32        (a)  Except as provided  in  subsection  (c),  the  total
 
HB2538 Engrossed            -128-              LRB9201093JScs
 1    loans  and extensions of credit, both direct and indirect, by
 2    a  savings  bank  to  any  person,  other  than  a  municipal
 3    corporation for money borrowed, outstanding at one time shall
 4    not exceed 20% of  the  savings  bank's  total  capital  plus
 5    general loan loss reserves.
 6        (b)  Except  as  provided  in  subsection  (c), the total
 7    loans and extensions of credit, both direct and indirect,  by
 8    a  savings  bank to any person outstanding at one time and at
 9    least 100% secured by readily marketable collateral having  a
10    market  value,  as  determined  by  reliable and continuously
11    available price quotations,  shall  not  exceed  10%  of  the
12    savings bank's total capital plus general loan loss reserves.
13    This limitation shall be separate from and in addition to the
14    limitation contained in subsection (a).
15        (c)  If  the  limit  under subsection (a) or (b) on total
16    loans to one borrower is less than $500,000, a  savings  bank
17    that meets its minimum capital requirement under this Act may
18    have loan and extensions of credit, both direct and indirect,
19    outstanding to any person at one time not to exceed $500,000.
20    With  the  prior  written  approval  of  the  Commissioner, a
21    savings bank that has capital in excess of 6% of  assets  may
22    make  loans  and extensions of credit to one borrower for the
23    development of residential housing properties, located or  to
24    be  located  in  this State, not to exceed 30% of the savings
25    bank's total capital plus general loan loss reserves.
26        (d)  For purposes of  this  Section,  the  term  "person"
27    shall  be deemed to include an individual, firm, corporation,
28    business  trust,  partnership,  trust,  estate,  association,
29    joint  venture,   pool,   syndicate,   sole   proprietorship,
30    unincorporated association, any political subdivision, or any
31    similar entity or organization.
32        (e)  For  the  purposes  of  this  Section  any  loan  or
33    extension  of  credit  granted to one person, the proceeds of
34    which are used for the direct benefit  of  a  second  person,
 
HB2538 Engrossed            -129-              LRB9201093JScs
 1    shall  be  deemed a loan or extension of credit to the second
 2    person as well as the first person.  In addition, a  loan  or
 3    extension  of  credit to one person shall be deemed a loan or
 4    extension of credit to others when a common enterprise exists
 5    between the first person and such other persons.
 6        (f)  For  the  purposes  of  this  Section,   the   total
 7    liabilities of a firm, partnership, pool, syndicate, or joint
 8    venture  shall  include the liabilities of the members of the
 9    entity.
10        (g)  For the purposes of this Section, the term  "readily
11    marketable collateral" means financial instruments or bullion
12    that are salable under ordinary circumstances with reasonable
13    promptness  at  a  fair  market  value  on  an  auction  or a
14    similarly   available   daily   bid-and-ask   price   market.
15    "Financial  instruments"  include   stocks,   bonds,   notes,
16    debentures traded on a national exchange or over the counter,
17    commercial   paper,   negotiable   certificates  of  deposit,
18    bankers' acceptances, and shares in money  market  or  mutual
19    funds.
20        (h)  Each   savings   bank   shall   institute   adequate
21    procedures  to  ensure  that  collateral  fully  secures  the
22    outstanding loan or extension of credit at all times.
23        (i)  If   collateral   values  fall  below  100%  of  the
24    outstanding loan or extension of credit to  the  extent  that
25    the  loan  or extension of credit no longer is in conformance
26    with  subsection  (b)  and  exceeds  the  20%  limitation  of
27    subsection (a), the loan must  be  brought  into  conformance
28    with  this  Section  within  5  business  days  except  where
29    judicial   proceedings   or   other   similar   extraordinary
30    occurrences prevent the savings bank from taking action.
31        (j)  This  Section shall not apply to loans or extensions
32    of credit to the United States of America or its agencies  or
33    this  State  or  its  agencies or to any loan, investment, or
34    extension of credit made pursuant to  Section  6003  of  this
 
HB2538 Engrossed            -130-              LRB9201093JScs
 1    Act.
 2        (k)  This  Section  does  not apply to the obligations as
 3    endorser, whether with or without recourse, or as  guarantor,
 4    whether   conditional  or  unconditional,  of  negotiable  or
 5    nonnegotiable  installment  consumer  paper  of  the   person
 6    transferring the same if the bank's files or the knowledge of
 7    its  officers  of  the  financial  condition of each maker of
 8    those obligations is reasonably adequate and if an officer of
 9    the bank,  designated  for  that  purpose  by  the  board  of
10    directors  of  the bank, certifies that the responsibility of
11    each maker of the obligations has been evaluated and that the
12    bank is relying primarily upon each maker for the payment  of
13    the  obligations.   The certification shall be in writing and
14    shall be retained as part of the records of the bank.
15        (l)  The Commissioner may prescribe rules  to  carry  out
16    the  purposes  of  this  Section  and  to establish limits or
17    requirements other than those specified in this  Section  for
18    particular types of loans and extensions of credit.
19    (Source: P.A. 89-74, eff. 6-30-95; 90-665, eff. 7-30-98.)

20        (205 ILCS 205/8015) (from Ch. 17, par. 7308-15)
21        Sec. 8015.  Change in control.
22        (a)  Any person, whether acting directly or indirectly or
23    through  or  in  concert with one or more persons, shall give
24    the Commissioner 60 days written notice of intent to  acquire
25    control  of  10%  or  more  of a savings bank or savings bank
26    affiliate operating under this Act.  The  Commissioner  shall
27    promulgate   rules  to  implement  this  provision  including
28    definitions, application, procedures, standards for  approval
29    or disapproval.
30        (b)  The  Commissioner  may examine the books and records
31    of any person giving notice of intent to acquire  control  of
32    10% or more of a savings bank operating under this Act.
33        (c)  The   Commissioner  may  approve  or  disapprove  an
 
HB2538 Engrossed            -131-              LRB9201093JScs
 1    application for change  of  control.   In  either  case,  the
 2    decision  must  be issued within 30 days of the filing of the
 3    initial application or the date of receipt of any  additional
 4    information  requested  by the Commissioner that is necessary
 5    for his decision to be made.    The  request  for  additional
 6    information  must be made within 20 days of the filing of the
 7    initial application.
 8    (Source: P.A. 86-1213.)

 9        (205 ILCS 205/9019 new)
10        Sec. 9019.  Reliance on the Commissioner.
11        (a)  The Commissioner may issue an opinion in response to
12    a specific request from a member of the public or the banking
13    or thrift industry or on his own initiative. The opinion  may
14    be  in  the  form  of  an  interpretive  letter, no-objection
15    letter, or other issuance the Commissioner deems appropriate.
16        (b)  If the Commissioner determines that the  opinion  is
17    useful  for  the  general  guidance  of the public or savings
18    banks,  the  Commissioner  may  disseminate  the  opinion  by
19    newsletter, via an electronic medium such as the internet, in
20    a volume of statutes or related materials  published  by  the
21    Commissioner   or   others,  or  by  other  means  reasonably
22    calculated to notify  persons  affected  by  the  opinion.  A
23    published   opinion   must   be   redacted  to  preserve  the
24    confidentiality of the requesting party unless the requesting
25    party consents to be identified in the published opinion.
26        (c)  No savings bank or  other  person  shall  be  liable
27    under  this  Act for any act done or omitted in good faith in
28    conformity with any rule, interpretation, or  opinion  issued
29    by  the  Commissioner,  notwithstanding that after the act or
30    omission has occurred, the rule, interpretation,  or  opinion
31    upon  which  reliance  is  placed  is  amended, rescinded, or
32    determined by judicial or other authority to be  invalid  for
33    any reason.
 
HB2538 Engrossed            -132-              LRB9201093JScs
 1        (205 ILCS 205/10001) (from Ch. 17, par. 7310-1)
 2        Sec. 10001.  Commissioner's authority to take custody and
 3    appoint a conservator or a receiver.
 4        (a)  The   Commissioner,  in  his  discretion,  may  take
 5    custody of  and  appoint  a  conservator  for  the  property,
 6    liabilities,  books,  records,  business, and assets of every
 7    kind and character  of  any  savings  bank  for  any  of  the
 8    purposes  hereinafter  enumerated  if it appears from reports
 9    made to the Commissioner or from examination made  by  or  on
10    behalf of the Commissioner:
11             (1)  That  the savings bank has failed to produce an
12        annual audited financial statement, after  receiving  one
13        extension from the Commissioner as permitted by this Act.
14             (2)  That  the  savings  bank's  books  and records,
15        after  at  least   2   consecutive   notices   from   the
16        Commissioner  spanning  at  least  2 consecutive calendar
17        quarters, are in an inaccurate and  incomplete  condition
18        to  the  extent  that the Commissioner is unable, through
19        the  normal  supervisory  process,   to   determine   the
20        financial condition of the savings bank or the details or
21        purpose of any transaction that may materially affect the
22        savings bank's financial condition.
23             (3)  That the savings bank has failed or is about to
24        fail  to  meet  its  capital requirement and can meet its
25        requirements and restore its capital only with assistance
26        from its federal insurer.
27             (4)  That the savings bank is insolvent in that  its
28        assets  are  less  than its obligations to its creditors,
29        including its depositors.
30             (5)  That   the   savings   bank   has   experienced
31        substantial dissipation of assets due to any violation of
32        a law, regulation, or order of the Commissioner or due to
33        any unsafe or unsound practice.
34             (6)  That there is a  likelihood  that  the  savings
 
HB2538 Engrossed            -133-              LRB9201093JScs
 1        bank  will  not  be  able  to  meet  the  demands  of its
 2        depositors or pay its obligations in the normal course of
 3        business.
 4             (7)  That losses have  occurred  or  are  likely  to
 5        occur  that have or will deplete all or substantially all
 6        of the savings  bank's  capital  and  that  there  is  no
 7        reasonable  prospect  for  replenishment  of  the savings
 8        bank's capital without federal assistance.
 9             (8)  That  the  savings  bank   or   its   officers,
10        directors,  or  employees,  or  persons in control of the
11        savings  bank  are  violating  a  law,   regulation,   or
12        supervisory  order  of  the Commissioner or of another of
13        its financial regulators.
14             (9)  That the  savings  bank  is  in  an  unsafe  or
15        unsound   condition  likely  to  cause  insolvency  or  a
16        substantial dissipation of assets or earnings  that  will
17        weaken  the  condition  of  the  savings  bank  and  will
18        prejudice the interests of its depositors.
19             (10)  That  the  directors,  officers,  trustees, or
20        liquidators have neglected, failed, or  refused  to  take
21        any  action  that the Commissioner may deem necessary for
22        the protection of the savings bank, including  production
23        of   an  annual  audited  financial  statement  after  an
24        extension was granted, have  continued  to  maintain  the
25        savings  bank's  books  and  records in an inaccurate and
26        incomplete condition for 2 consecutive quarters  after  2
27        notices   from  the  Commissioner,  or  have  impeded  or
28        obstructed an examination.
29             (11)  That the deposit accounts of the savings  bank
30        are  impaired  to the extent that the realizable value of
31        its assets is insufficient to pay in full  its  creditors
32        and   holders   of  its  deposit  accounts  or  meet  its
33        obligations in the normal course of business; or that its
34        capital stock is impaired.
 
HB2538 Engrossed            -134-              LRB9201093JScs
 1             (12)  That the savings bank is  unable  to  continue
 2        operation.
 3             (13)  That  the  business  of  the  savings  bank or
 4        savings bank in  liquidation  is  being  conducted  in  a
 5        fraudulent, illegal, or unsafe or unsound manner.
 6             (14)  That  the  officers,  employees,  trustees, or
 7        liquidators have continued to assume  duties  or  perform
 8        acts without giving bond as required by the provisions of
 9        this Act.
10        (b)  If   any   condition  exists  that  would  give  the
11    Commissioner  authority  to  take  custody  of   an   insured
12    depository institution, the action of the Commissioner may be
13    withheld  pending  a satisfactory resolution of the condition
14    as suggested  by  the  insurance  corporation,  provided  the
15    savings  bank  has  sufficient  liquidity and has adopted and
16    implemented an  operating  plan  considered  prudent  by  the
17    Commissioner.
18        (c)  No  action  or  inaction  of  the Commissioner taken
19    under  this  Article  shall  cause  the  Commissioner  to  be
20    personally liable for that  action  or  inaction  unless  the
21    Commissioner's action or inaction is found to be in violation
22    of a criminal statute.
23        (d)  The   Commissioner   shall   promulgate   rules  and
24    regulations to govern the  determination  of  a  need  for  a
25    conservator  or  receiver, the selection and appointment of a
26    conservator or receiver, and the conduct of a conservatorship
27    or receivership,  including  allocation  of  the  payment  of
28    costs.
29        (e)  The  proceedings  pursuant  to this Article shall be
30    the exclusive remedy and,  except  for  the  Federal  Deposit
31    Insurance  Corporation acting pursuant to the Federal Deposit
32    Insurance Act, shall be the only proceedings commenced in any
33    court for the taking of custody, the dissolution, the winding
34    up of the affairs, or the appointment of  a  receiver  for  a
 
HB2538 Engrossed            -135-              LRB9201093JScs
 1    savings bank.
 2    (Source: P.A. 90-301, eff. 8-1-97.)

 3        (205 ILCS 205/11003) (from Ch. 17, par. 7311-3)
 4        Sec. 11003.  Removal and prohibition authority.
 5        (a)  In   addition   to  other  provisions  of  this  Act
 6    concerning  officers  and  directors,  the  Commissioner  may
 7    remove or suspend  from any savings bank operating under this
 8    Act any officer, director, employee, or agent  of  a  savings
 9    bank,  and the Commissioner may prohibit participation in the
10    affairs of any  savings  bank  by  any  current,  former,  or
11    prospective  officer,  director,  employee,  or  agent  of  a
12    savings bank, if he finds that:
13             (1)  The   person   or   persons  have  directly  or
14        indirectly  violated  any  law,  regulation,   or   order
15        including  orders, conditions, and agreements between the
16        savings bank and the Commissioner or between the  savings
17        bank and its federal regulators.
18             (2)  The  person  or  persons  have  breached  their
19        fiduciary or professional responsibilities to the savings
20        bank.
21             (3)  The  person  or  persons have similarly behaved
22        towards  any  other  insured  depository  institution  or
23        otherwise regulated entity or that the person or  persons
24        are  the subject of any final order issued by the federal
25        insurer, the Office of the Comptroller of  the  Currency,
26        the Federal Reserve Board, a state financial institutions
27        regulator,  the Securities and Exchange Commission, or by
28        a state or federal court of law.
29        (b)  The  Commissioner may serve upon a party  a  written
30    notice  of  the Commissioner's intention to remove or suspend
31    the party from office in the savings bank or to prohibit  any
32    further  participation  in  any  manner  by  the party in the
33    conduct  of  the  affairs  of  any  savings  bank   financial
 
HB2538 Engrossed            -136-              LRB9201093JScs
 1    institution, if the Commissioner finds because of a violation
 2    of subsection (a) that:
 3             (1)  Any  savings  bank,  other  insured  depository
 4        institution,  or  other  regulated entity has or probably
 5        will suffer financial loss or other damage.
 6             (2)  The interests of savings bank's  depositors  or
 7        other  insured  depository  institution's depositors have
 8        been or could be prejudiced.
 9             (3)  The party has received financial gain or  other
10        benefit by reason of the violation.
11             (4)  The   violation  or  breach  involves  personal
12        dishonesty on the  part  of  the  party  or  demonstrates
13        willful  or  continuing  disregard  by  the party for the
14        safety and soundness of the savings bank or other insured
15        depository institution.
16    (Source: P.A. 86-1213.)

17        (205 ILCS 205/11004) (from Ch. 17, par. 7311-4)
18        Sec. 11004. Industrywide prohibition.
19        (a)  Except   as   provided   in   regulations   of   the
20    Commissioner, any person who has been  removed  or  suspended
21    from  office  in  a  savings bank operating under this Act or
22    prohibited from participating in the conduct of  the  affairs
23    of  a savings bank operating under this Act may not, while an
24    order is in effect, continue or begin to hold any office  in,
25    or participate in any manner in the conduct of the affairs of
26    any  savings bank regulated by the State of Illinois, another
27    insured depository institution  regulated  by  the  State  of
28    Illinois, or any other financial services entity regulated by
29    the State of Illinois.
30        (b)  Any violation of subsection (a) by any person who is
31    subject  to  an  order  described in that subsection shall be
32    treated as violation of the order.
33    (Source: P.A. 86-1213.)
 
HB2538 Engrossed            -137-              LRB9201093JScs
 1        (205 ILCS 205/11008) (from Ch. 17, par. 7311-8)
 2        Sec.  11008.  Unauthorized  participation  by   convicted
 3    individual.
 4        (a)  Except   with  the  prior  written  consent  of  the
 5    Commissioner,  no  person  who  has  been  convicted  of  any
 6    criminal offense involving dishonesty or a  breach  of  trust
 7    may own or control directly or indirectly more than 0.001% of
 8    the  capital stock of, receive benefit directly or indirectly
 9    from, or participate directly or indirectly in any manner  in
10    the conduct of the affairs of a savings bank.
11        (b)  A  savings  bank  may  not permit participation by a
12    person described in subsection (a).
13        (c)  Whoever knowingly violates subsection (a) or (b)  is
14    guilty  of  a  Class  3 felony and may be fined not more than
15    $10,000 for each day of violation.
16    (Source: P.A. 91-97, eff. 7-9-99.)

17        (205 ILCS 205/11012 rep.)
18        Section 27.  The Savings Bank Act is amended by repealing
19    Section 11012.

20        Section 28.  The Illinois Credit Union Act is amended  by
21    changing Section 10 as follows:

22        (205 ILCS 305/10) (from Ch. 17, par. 4411)
23        Sec. 10.  Credit union records; member financial records.
24        (1)  A  credit  union shall establish and maintain books,
25    records, accounting systems and procedures  which  accurately
26    reflect  its  operations  and  which enable the Department to
27    readily ascertain the true financial condition of the  credit
28    union and whether it is complying with this Act.
29        (2)  A  photostatic  or  photographic reproduction of any
30    credit union records  shall  be  admissible  as  evidence  of
31    transactions with the credit union.
 
HB2538 Engrossed            -138-              LRB9201093JScs
 1        (3) (a)  For  the  purpose  of  this  Section,  the  term
 2        "financial  records" means any original, any copy, or any
 3        summary of (1) a document  granting  signature  authority
 4        over  an  account,  (2) a statement, ledger card or other
 5        record on any account which shows each transaction in  or
 6        with respect to that account, (3) a check, draft or money
 7        order drawn on a financial institution or other entity or
 8        issued  and payable by or through a financial institution
 9        or  other  entity,  or  (4)  any  other  item  containing
10        information pertaining to any relationship established in
11        the ordinary course of business between  a  credit  union
12        and  its  member, including financial statements or other
13        financial information provided by the member.
14             (b)  This Section does not prohibit:
15                  (1)  The preparation, examination, handling  or
16             maintenance of any financial records by any officer,
17             employee  or  agent of a credit union having custody
18             of such records, or the examination of such  records
19             by  a  certified  public  accountant  engaged by the
20             credit union to perform an independent audit.;
21                  (2)  The examination of any  financial  records
22             by  or  the  furnishing  of  financial  records by a
23             credit union to any officer, employee  or  agent  of
24             the    Department,   the   National   Credit   Union
25             Administration, Federal Reserve board or any insurer
26             of share accounts for use solely in the exercise  of
27             his duties as an officer, employee or agent.;
28                  (3)  The  publication  of  data  furnished from
29             financial records relating to members where the data
30             cannot be identified to any particular  customer  of
31             account.;
32                  (4)  The  making of reports or returns required
33             under Chapter 61 of the  Internal  Revenue  Code  of
34             1954.;
 
HB2538 Engrossed            -139-              LRB9201093JScs
 1                  (5)  Furnishing   information   concerning  the
 2             dishonor of any negotiable instrument  permitted  to
 3             be disclosed under the Uniform Commercial Code.;
 4                  (6)  The  exchange  in  the  regular  course of
 5             business of (i) credit information between a  credit
 6             union   and   other   credit   unions  or  financial
 7             institutions or commercial enterprises, directly  or
 8             through   a   consumer   reporting  agency  or  (ii)
 9             financial  records  or  information   derived   from
10             financial  records  between a credit union and other
11             credit   unions   or   financial   institutions   or
12             commercial enterprises for the purpose of conducting
13             due diligence pursuant to a merger or a purchase  or
14             sale of assets or liabilities of the credit union.;
15                  (7)  The   furnishing  of  information  to  the
16             appropriate law enforcement  authorities  where  the
17             credit  union  reasonably  believes  it has been the
18             victim of a crime.;
19                  (8)  The furnishing of information pursuant  to
20             the Uniform Disposition of Unclaimed Property Act.;
21                  (9)  The  furnishing of information pursuant to
22             the Illinois Income Tax Act and the Illinois  Estate
23             and Generation-Skipping Transfer Tax Act.;
24                  (10)  The furnishing of information pursuant to
25             the   federal  "Currency  and  Foreign  Transactions
26             Reporting  Act",  Title  31,  United  States   Code,
27             Section 1051 et sequentia.; or
28                  (11)  The furnishing of information pursuant to
29             any   other   statute  which  by  its  terms  or  by
30             regulations  promulgated  thereunder  requires   the
31             disclosure   of  financial  records  other  than  by
32             subpoena, summons, warrant or court order.
33                  (12)  The   furnishing   of   information    in
34             accordance  with the federal Personal Responsibility
 
HB2538 Engrossed            -140-              LRB9201093JScs
 1             and Work Opportunity Reconciliation Act of 1996. Any
 2             credit union governed by this Act shall  enter  into
 3             an  agreement for data exchanges with a State agency
 4             provided the State agency pays to the credit union a
 5             reasonable  fee  not  to  exceed  its  actual   cost
 6             incurred.   A  credit union providing information in
 7             accordance with this item shall not be liable to any
 8             account holder or other person for any disclosure of
 9             information to a State agency,  for  encumbering  or
10             surrendering  any assets held by the credit union in
11             response to a lien or order to withhold and  deliver
12             issued  by  a  State agency, or for any other action
13             taken pursuant to this item, including individual or
14             mechanical errors,  provided  the  action  does  not
15             constitute gross negligence or willful misconduct. A
16             credit  union  shall  have  no  obligation  to hold,
17             encumber, or surrender  assets  until  it  has  been
18             served  with  a subpoena, summons, warrant, court or
19             administrative order, lien, or levy.
20                  (13)  The  furnishing  of  information  to  law
21             enforcement authorities, the Illinois Department  on
22             Aging  and  its regional administrative and provider
23             agencies, the Department of Human Services Office of
24             Inspector  General,  or  public  guardians,  if  the
25             credit union  suspects  that  a  member  who  is  an
26             elderly  or  disabled  person has been or may become
27             the  victim  of  financial  exploitation.  For   the
28             purposes  of  this item (13), the term: (i) "elderly
29             person" means a person who is 60 or  more  years  of
30             age,  (ii)  "disabled person" means a person who has
31             or reasonably appears to the credit union to have  a
32             physical  or  mental  disability that impairs his or
33             her ability to seek or  obtain  protection  from  or
34             prevent financial exploitation, and (iii) "financial
 
HB2538 Engrossed            -141-              LRB9201093JScs
 1             exploitation"  means  tortious or illegal use of the
 2             assets  or  resources  of  an  elderly  or  disabled
 3             person,   and    includes,    without    limitation,
 4             misappropriation of the elderly or disabled person's
 5             assets  or  resources  by undue influence, breach of
 6             fiduciary   relationship,    intimidation,    fraud,
 7             deception,  extortion,  or  the  use  of  assets  or
 8             resources  in  any  manner contrary to law. A credit
 9             union or person furnishing information  pursuant  to
10             this  item (13) shall be entitled to the same rights
11             and protections as a person  furnishing  information
12             under  the  Elder  Abuse  and  Neglect  Act  and the
13             Illinois Domestic Violence Act of 1986.
14                  (14)  The disclosure of  financial  records  or
15             information  as  necessary to effect, administer, or
16             enforce a transaction requested or authorized by the
17             member, or in connection with:
18                       (A)  servicing or processing  a  financial
19                  product  or  service requested or authorized by
20                  the member;
21                       (B)  maintaining or servicing  a  member's
22                  account with the credit union; or
23                       (C)  a  proposed  or actual securitization
24                  or secondary market sale  (including  sales  of
25                  servicing rights) related to a transaction of a
26                  member.
27             Nothing  in  this item (14), however, authorizes the
28        sale of the financial records or information of a  member
29        without the consent of the member.
30             (15)  The   disclosure   of   financial  records  or
31        information as necessary to protect  against  or  prevent
32        actual  or  potential  fraud,  unauthorized transactions,
33        claims, or other liability.
34        (c)  Except as otherwise provided by this Act,  a  credit
 
HB2538 Engrossed            -142-              LRB9201093JScs
 1    union may not disclose to any person, except to the member or
 2    his  duly authorized agent, any financial records relating to
 3    that member of the credit union unless:
 4             (1)  the member has  authorized  disclosure  to  the
 5        person;
 6             (2)  the financial records are disclosed in response
 7        to  a  lawful  subpoena,  summons, warrant or court order
 8        that meets the requirements of subparagraph (d)  of  this
 9        Section; or
10             (3)  the  credit  union  is attempting to collect an
11        obligation owed to the credit union and the credit  union
12        complies  with  the  provisions  of  Section  2I  of  the
13        Consumer Fraud and Deceptive Business Practices Act.
14        (d)  A  credit  union  shall  disclose  financial records
15    under subparagraph (c)(2)  of  this  Section  pursuant  to  a
16    lawful  subpoena,  summons, warrant or court order only after
17    the credit union mails  a  copy  of  the  subpoena,  summons,
18    warrant  or  court  order  to  the  person  establishing  the
19    relationship  with the credit union, if living, and otherwise
20    his personal representative, if  known,  at  his  last  known
21    address  by  first  class  mail,  postage  prepaid unless the
22    credit union is specifically prohibited  from  notifying  the
23    person  by  order  of court or by applicable State or federal
24    law. In the case of a grand jury  subpoena,  a  credit  union
25    shall not mail a copy of a subpoena to any person pursuant to
26    this  subsection  if  the subpoena was issued by a grand jury
27    under the Statewide Grand Jury Act or  notifying  the  person
28    would   constitute  a  violation  of  the  federal  Right  to
29    Financial Privacy Act of 1978.
30        (e) (1)  Any officer or employee of a  credit  union  who
31        knowingly  and  wilfully  furnishes  financial records in
32        violation of this Section is guilty of a business offense
33        and upon conviction thereof shall be fined not more  than
34        $1,000.
 
HB2538 Engrossed            -143-              LRB9201093JScs
 1             (2)  Any  person  who knowingly and wilfully induces
 2        or attempts to induce any officer or employee of a credit
 3        union to disclose financial records in violation of  this
 4        Section   is  guilty  of  a  business  offense  and  upon
 5        conviction thereof shall be fined not more than $1,000.
 6        (f)  A credit union shall be reimbursed for  costs  which
 7    are   reasonably  necessary  and  which  have  been  directly
 8    incurred in searching for, reproducing or transporting books,
 9    papers, records  or  other  data  of  a  member  required  or
10    requested  to  be  produced  pursuant  to  a lawful subpoena,
11    summons, warrant or court order.  The Director may determine,
12    by rule, the rates and conditions under which  payment  shall
13    be  made.   Delivery  of  requested  documents may be delayed
14    until final reimbursement of all costs is received.
15    (Source: P.A. 90-18, eff. 7-1-97; 91-929, eff. 12-15-00.)

16        Section 30.  The Interest  Act  is  amended  by  changing
17    Sections 4 and 4a as follows:

18        (815 ILCS 205/4) (from Ch. 17, par. 6404)
19        Sec. 4.  General interest rate.
20        (1)  In  all written contracts it shall be lawful for the
21    parties to stipulate or agree that 9% per annum, or any  less
22    sum  of  interest, shall be taken and paid upon every $100 of
23    money loaned or in any manner due and owing from  any  person
24    to  any  other person or corporation in this state, and after
25    that rate for a greater or less  sum,  or  for  a  longer  or
26    shorter time, except as herein provided.
27        The  maximum  rate  of  interest  that  may  lawfully  be
28    contracted for is determined by the law applicable thereto at
29    the  time  the  contract  is  made.   Any  provision  in  any
30    contract,  whether  made  before or after July 1, 1969, which
31    provides for or purports  to  authorize,  contingent  upon  a
32    change  in  the  Illinois law after the contract is made, any
 
HB2538 Engrossed            -144-              LRB9201093JScs
 1    rate of interest greater than the maximum lawful rate at  the
 2    time the contract is made, is void.
 3        It  is  lawful  for  a  state  bank  or  a  branch  of an
 4    out-of-state bank, as those terms are defined in Section 2 of
 5    the Illinois Banking  Act,  to  receive  or  to  contract  to
 6    receive and collect interest and charges at any rate or rates
 7    agreed  upon  by  the  bank or branch and the borrower. It is
 8    lawful for a savings bank chartered under  the  Savings  Bank
 9    Act  or  a  savings  association chartered under the Illinois
10    Savings and Loan Act  of  1985  to  receive  or  contract  to
11    receive  and  collect interest and charges at any rate agreed
12    upon by the savings  bank  or  savings  association  and  the
13    borrower.
14        It  is  lawful  to  receive or to contract to receive and
15    collect interest and charges as authorized by this Act and as
16    authorized by the Consumer Installment Loan Act  and  by  the
17    "Consumer  Finance  Act",  approved  July 10, 1935, as now or
18    hereafter amended.  It is lawful to charge, contract for, and
19    receive any rate or amount of interest or  compensation  with
20    respect to the following transactions:
21             (a)  Any loan made to a corporation;
22             (b)  Advances  of  money, repayable on demand, to an
23        amount  not  less  than  $5,000,  which  are  made   upon
24        warehouse  receipts,  bills  of  lading,  certificates of
25        stock, certificates of deposit, bills of exchange,  bonds
26        or  other  negotiable  instruments  pledged as collateral
27        security for such repayment, if evidenced by a writing;
28             (c)  Any credit transaction  between  a  merchandise
29        wholesaler  and retailer; any business loan to a business
30        association or copartnership or to a  person  owning  and
31        operating a business as sole proprietor or to any persons
32        owning and operating a business as joint venturers, joint
33        tenants   or   tenants  in  common,  or  to  any  limited
34        partnership, or to any trustee  owning  and  operating  a
 
HB2538 Engrossed            -145-              LRB9201093JScs
 1        business   or  whose  beneficiaries  own  and  operate  a
 2        business, except that any loan which is secured (1) by an
 3        assignment of  an  individual  obligor's  salary,  wages,
 4        commissions or other compensation for services, or (2) by
 5        his  household  furniture  or  other  goods  used for his
 6        personal, family or household purposes  shall  be  deemed
 7        not  to  be a loan within the meaning of this subsection;
 8        and  provided  further  that  a  loan   which   otherwise
 9        qualifies  as  a business loan within the meaning of this
10        subsection shall not  be  deemed  as  not  so  qualifying
11        because  of the inclusion, with other security consisting
12        of business assets of any such obligor,  of  real  estate
13        occupied   by   an   individual  obligor  solely  as  his
14        residence.  The term "business" shall be deemed to mean a
15        commercial, agricultural or industrial  enterprise  which
16        is  carried  on  for the purpose of investment or profit,
17        but  shall  not  be  deemed  to  mean  the  ownership  or
18        maintenance of real  estate  occupied  by  an  individual
19        obligor solely as his residence;
20             (d)  Any loan made in accordance with the provisions
21        of  Subchapter  I of Chapter 13 of Title 12 of the United
22        States Code, which is designated as  "Housing  Renovation
23        and Modernization";
24             (e)  Any  mortgage  loan  insured  or  upon  which a
25        commitment to insure has been issued under the provisions
26        of the National Housing Act, Chapter 13 of  Title  12  of
27        the United States Code;
28             (f)  Any  mortgage  loan  guaranteed or upon which a
29        commitment  to  guaranty  has  been  issued   under   the
30        provisions  of  the Veterans' Benefits Act, Subchapter II
31        of Chapter 37 of Title 38 of the United States Code;
32             (g)  Interest  charged  by  a   broker   or   dealer
33        registered  under the Securities Exchange Act of 1934, as
34        amended, or registered under the Illinois Securities  Law
 
HB2538 Engrossed            -146-              LRB9201093JScs
 1        of  1953,  approved  July  13,  1953, as now or hereafter
 2        amended, on a debit balance in an account for a  customer
 3        if  such debit balance is payable at will without penalty
 4        and is  secured  by  securities  as  defined  in  Uniform
 5        Commercial Code-Investment Securities;
 6             (h)  Any  loan  made by a participating bank as part
 7        of any loan guarantee program which  provides  for  loans
 8        and   for  the  refinancing  of  such  loans  to  medical
 9        students, interns and residents and which are  guaranteed
10        by   the   American  Medical  Association  Education  and
11        Research Foundation;
12             (i)  Any  loan  made,  guaranteed,  or  insured   in
13        accordance  with  the  provisions  of  the Housing Act of
14        1949, Subchapter III of Chapter 8A of  Title  42  of  the
15        United  States  Code  and the Consolidated Farm and Rural
16        Development Act, Subchapters I, II, and III of Chapter 50
17        of Title 7 of the United States Code;
18             (j)  Any loan by an employee pension  benefit  plan,
19        as  defined  in  Section 3 (2) of the Employee Retirement
20        Income Security Act of 1974 (29 U.S.C.A. Sec.  1002),  to
21        an  individual  participating in such plan, provided that
22        such loan satisfies the prohibited transaction  exemption
23        requirements  of  Section  408  (b) (1) (29 U.S.C.A. Sec.
24        1108 (b) (1)) or Section 2003 (a) (26 U.S.C.A. Sec.  4975
25        (d)  (1))  of the Employee Retirement Income Security Act
26        of 1974;
27             (k)  Written contracts, agreements or bonds for deed
28        providing for installment purchase of real estate;
29             (1)  Loans secured by a mortgage on real estate;
30             (m)  Loans   made   by   a   sole    proprietorship,
31        partnership, or corporation to an employee or to a person
32        who   has   been   offered   employment   by   such  sole
33        proprietorship, partnership, or corporation made for  the
34        sole  purpose  of  transferring an employee or person who
 
HB2538 Engrossed            -147-              LRB9201093JScs
 1        has been offered employment to another office  maintained
 2        and   operated   by   the   same   sole   proprietorship,
 3        partnership, or corporation;
 4             (n)  Loans to or for the benefit of students made by
 5        an institution of higher education.
 6        (2)  Except for loans described in subparagraph (a), (c),
 7    (d),  (e),  (f) or (i) of subsection (1) of this Section, and
 8    except to the extent permitted by the applicable statute  for
 9    loans made pursuant to Section 4a or pursuant to the Consumer
10    Installment Loan Act:
11             (a)  Whenever  the  rate  of interest exceeds 8% per
12        annum on any written contract, agreement or bond for deed
13        providing for the  installment  purchase  of  residential
14        real  estate,  or  on  any  loan secured by a mortgage on
15        residential real estate, it shall be unlawful to  provide
16        for a prepayment penalty or other charge for prepayment.
17             (b)  No   agreement,   note   or   other  instrument
18        evidencing a loan secured by a  mortgage  on  residential
19        real  estate,  or written contract, agreement or bond for
20        deed  providing   for   the   installment   purchase   of
21        residential  real  estate,  may provide for any change in
22        the contract rate of interest during  the  term  thereof.
23        However,  if  the  Congress  of  the United States or any
24        federal agency authorizes any class of lender  to  enter,
25        within  limitations,  into  mortgage contracts or written
26        contracts, agreements or bonds for deed in which the rate
27        of interest  may  be  changed  during  the  term  of  the
28        contract,  any  person, firm, corporation or other entity
29        not otherwise  prohibited  from  entering  into  mortgage
30        contracts  or  written contracts, agreements or bonds for
31        deed in Illinois may enter  into  mortgage  contracts  or
32        written  contracts, agreements or bonds for deed in which
33        the rate of interest may be changed during  the  term  of
34        the contract, within the same limitations.
 
HB2538 Engrossed            -148-              LRB9201093JScs
 1        (3)  In  any  contract  or  loan  which  is  secured by a
 2    mortgage, deed of trust, or conveyance in  the  nature  of  a
 3    mortgage,  on  residential real estate, the interest which is
 4    computed, calculated, charged, or collected pursuant to  such
 5    contract  or  loan,  or  pursuant  to  any regulation or rule
 6    promulgated pursuant  to  this  Act,  may  not  be  computed,
 7    calculated,  charged  or  collected  for  any  period of time
 8    occurring after the date on  which  the  total  indebtedness,
 9    with  the  exception  of  late  payment penalties, is paid in
10    full.
11        For purposes of this Section, a prepayment shall mean the
12    payment of the total indebtedness, with the exception of late
13    payment penalties if incurred or charged, on any date  before
14    the date specified in the contract or loan agreement on which
15    the  total  indebtedness shall be paid in full, or before the
16    date on which all payments, if timely made, shall  have  been
17    made.  In the event of a prepayment of the indebtedness which
18    is  made  on  a  date after the date on which interest on the
19    indebtedness  was  last  computed,  calculated,  charged,  or
20    collected but before the next date on which interest  on  the
21    indebtedness  was  to  be  calculated,  computed, charged, or
22    collected, the  lender  may  calculate,  charge  and  collect
23    interest  on  the  indebtedness  for the period which elapsed
24    between the date on which the prepayment is made and the date
25    on which interest on  the  indebtedness  was  last  computed,
26    calculated,  charged or collected at a rate equal to 1/360 of
27    the annual rate for each day which  so  elapsed,  which  rate
28    shall  be  applied  to the indebtedness outstanding as of the
29    date of prepayment.  The lender shall refund to the  borrower
30    any  interest  charged  or collected which exceeds that which
31    the lender may charge or collect pursuant  to  the  preceding
32    sentence. The provisions of this amendatory Act of 1985 shall
33    apply only to contracts or loans entered into on or after the
34    effective date of this amendatory Act, but shall not apply to
 
HB2538 Engrossed            -149-              LRB9201093JScs
 1    contracts  or  loans  entered into on or after that date that
 2    are  subject  to  Section  4a  of  this  Act,  the   Consumer
 3    Installment Loan Act, or the Retail Installment Sales Act, or
 4    that  provide  for  the  refund  of  precomputed  interest on
 5    prepayment in the manner provided by such Act.
 6    (Source: P.A. 89-208, eff. 9-29-95.)

 7        (815 ILCS 205/4a) (from Ch. 17, par. 6410)
 8        Sec. 4a.  Installment loan rate.
 9        (a)  On money loaned to or in any manner owing  from  any
10    person,  whether secured or unsecured, except where the money
11    loaned or in any manner owing is directly or  indirectly  for
12    the  purchase price of real estate or an interest therein and
13    is secured by a lien on or retention of title  to  that  real
14    estate  or  interest  therein,  to  an  amount  not more than
15    $25,000 (excluding interest) which is evidenced by a  written
16    instrument  providing  for  the  payment thereof in 2 or more
17    periodic installments over a period  of  not  more  than  181
18    months  from  the  date  of  the  execution  of  the  written
19    instrument, it is lawful to receive or to contract to receive
20    and collect either:
21             (i)  interest  in  an  amount equivalent to interest
22        computed at a rate not  exceeding  9%  per  year  on  the
23        entire  principal  amount  of  the money loaned or in any
24        manner owing for the period from the date of  the  making
25        of  the  loan  or the incurring of the obligation for the
26        amount owing evidenced by the  written  instrument  until
27        the date of the maturity of the last installment thereof,
28        and  to  add  that  amount to the principal,  except that
29        there shall be no limit on the rate of interest which may
30        be received or contracted to be received and collected by
31        (1) any bank that has its main office or, after  May  31,
32        1997,  a  branch  in  this  State; (2) a savings and loan
33        association chartered under the Illinois Savings and Loan
 
HB2538 Engrossed            -150-              LRB9201093JScs
 1        Act of 1985, a savings bank chartered under  the  Savings
 2        Bank  Act,   or  a  federal  savings and loan association
 3        established under the  laws  of  the  United  States  and
 4        having  its  main office in this State; or (3) any lender
 5        licensed under either the Consumer  Finance  Act  or  the
 6        Consumer  Installment  Loan Act, but in any case in which
 7        interest is received, contracted for or collected on  the
 8        basis  of this clause (i), the debtor may satisfy in full
 9        at any time before maturity the  debt  evidenced  by  the
10        written  instrument,  and in so satisfying must receive a
11        refund credit against the total amount of interest  added
12        to  the  principal  computed in the manner provided under
13        Section 15(f)(3) of the Consumer Installment Loan Act for
14        refunds or credits of applicable interest on  payment  in
15        full  of  precomputed  loans before the final installment
16        due date; or
17             (ii)  interest accrued on the principal balance from
18        time to time remaining unpaid, from the date of making of
19        the loan or the incurring of the obligation to  the  date
20        of  the  payment  of  the  debt  in  full,  at a rate not
21        exceeding the annual percentage rate  equivalent  of  the
22        rate  permitted to be charged under clause (i) above, but
23        in any such case the debtor may, provided that the debtor
24        shall have paid in full all interest  and  other  charges
25        accrued  to  the  date  of  such  prepayment,  prepay the
26        principal balance in full or in part  at  any  time,  and
27        interest shall, upon any such prepayment, cease to accrue
28        on the principal amount which has been prepaid.
29        (b)  Whenever the principal amount of an installment loan
30    is $300 or more and the repayment period is 6 months or more,
31    a minimum charge of $15 may be collected instead of interest,
32    but  only  one  minimum charge may be collected from the same
33    person during one year. When the principal amount of the loan
34    (excluding interest) is $800 or less, the lender or  creditor
 
HB2538 Engrossed            -151-              LRB9201093JScs
 1    may  contract  for and receive a service charge not to exceed
 2    $5 in addition to interest; and that service  charge  may  be
 3    collected  when the loan is made, but only one service charge
 4    may be contracted for, received, or collected from  the  same
 5    person during one year.
 6        (c)  Credit life insurance and credit accident and health
 7    insurance, and any charge therefor which is deducted from the
 8    loan  or paid by the obligor, must comply with Article IX 1/2
 9    of the Illinois Insurance Code and all lawful requirements of
10    the Director of Insurance related thereto. When there  are  2
11    or  more  obligors  on the loan contract, only one charge for
12    credit  life  insurance  and  credit  accident   and   health
13    insurance  may  be  made  and only one of the obligors may be
14    required to  be  insured.  Insurance  obtained  from,  by  or
15    through  the  lender  or  creditor must be in effect when the
16    loan is transacted. The purchase of that  insurance  from  an
17    agent,  broker or insurer specified by the lender or creditor
18    may not be a condition precedent to the granting of the loan.
19        (d)  The lender or creditor may require  the  obligor  to
20    provide  property  insurance on security other than household
21    goods, furniture and personal effects. The amount and term of
22    the insurance must be reasonable in relation  to  the  amount
23    and  term  of the loan contract and the type and value of the
24    security, and the insurance must be  procured  in  accordance
25    with  the  insurance laws of this State. The purchase of that
26    insurance from an agent, broker or insurer specified  by  the
27    lender  or  creditor  may not be a condition precedent to the
28    granting of the loan.
29        (e)  The  lender  or  creditor  may,  if   the   contract
30    provides, collect a delinquency and collection charge on each
31    installment  in default for a period of not less than 10 days
32    in  an  amount  not  exceeding  5%  of  the  installment   on
33    installments in excess of $200 or $10 on installments of $200
34    or  less,  but only one delinquency and collection charge may
 
HB2538 Engrossed            -152-              LRB9201093JScs
 1    be collected on any  installment  regardless  of  the  period
 2    during which it remains in default. In addition, the contract
 3    may  provide  for  the  payment  by the borrower or debtor of
 4    attorney's fees incurred  by  the  lender  or  creditor.  The
 5    lender or creditor may enforce such a provision to the extent
 6    of  the  reasonable  attorney's  fees  incurred by him in the
 7    collection or enforcement  of  the  contract  or  obligation.
 8    Whenever  interest  is  contracted for or received under this
 9    Section, no amount in addition to the charges  authorized  by
10    this   Section   may   be  directly  or  indirectly  charged,
11    contracted for or received, except  lawful  fees  paid  to  a
12    public officer or agency to record, file or release security,
13    and  except  costs  and  disbursements  including  reasonable
14    attorney's  fees,  incurred in legal proceedings to collect a
15    loan or to realize on a security after default. This  Section
16    does  not prohibit the receipt of any commission, dividend or
17    other benefit by the creditor or an  employee,  affiliate  or
18    associate  of  the  creditor from the insurance authorized by
19    this Section.
20        (f)  When interest is contracted for  or  received  under
21    this Section, the lender must disclose the following items to
22    the  obligor  in  a  written  statement  before  the  loan is
23    consummated:
24             (1)  the amount and date of the loan contract;
25             (2)  the  amount  of  loan  credit  using  the  term
26        "amount financed";
27             (3)  every deduction from  the  amount  financed  or
28        payment made by the obligor for insurance and the type of
29        insurance for which each deduction or payment was made;
30             (4)  every  other deduction from the loan or payment
31        made by the obligor  in  connection  with  obtaining  the
32        loan;
33             (5)  the  date on which the finance charge begins to
34        accrue if different from the date of the transaction;
 
HB2538 Engrossed            -153-              LRB9201093JScs
 1             (6)  the total amount of the  loan  charge  for  the
 2        scheduled term of the loan contract with a description of
 3        each amount included using the term "finance charge";
 4             (7)  the  finance  charge  expressed  as  an  annual
 5        percentage  rate using the term "annual percentage rate".
 6        "Annual  percentage  rate"  means  the   nominal   annual
 7        percentage   rate   of   finance   charge  determined  in
 8        accordance with the actuarial method of computation  with
 9        an  accuracy at least to the nearest 1/4 of 1%; or at the
10        option of the lender by application of the United  States
11        rule  so  that  it  may  be disclosed with an accuracy at
12        least to the nearest 1/4 of 1%;
13             (8)  the number, amount and due dates or periods  of
14        payments  scheduled to repay the loan and the sum of such
15        payments using the term "total of payments";
16             (9)  the amount, or method of computing  the  amount
17        of any default, delinquency or similar charges payable in
18        the event of late payments;
19             (10)  the  right  of  the obligor to prepay the loan
20        and the fact that such prepayment will reduce the  charge
21        for the loan;
22             (11)  a description or identification of the type of
23        any  security interest held or to be retained or acquired
24        by the lender in connection with the  loan  and  a  clear
25        identification  of  the  property  to  which the security
26        interest relates.  If  after-acquired  property  will  be
27        subject  to  the security interest, or if other or future
28        indebtedness is or may be secured by any  such  property,
29        this  fact shall be clearly set forth in conjunction with
30        the description or identification of the type of security
31        interest held, retained or acquired;
32             (12)  a description of any penalty charge  that  may
33        be  imposed by the lender for prepayment of the principal
34        of the obligation with an explanation of  the  method  of
 
HB2538 Engrossed            -154-              LRB9201093JScs
 1        computation  of  such  penalty  and  the conditions under
 2        which it may be imposed;
 3             (13)  unless the contract provides for  the  accrual
 4        and  payment  of the finance charge on the balance of the
 5        amount financed from time to time  remaining  unpaid,  an
 6        identification  of  the  method of computing any unearned
 7        portion of the finance charge in the event of  prepayment
 8        of the loan.
 9        The  terms  "finance charge" and "annual percentage rate"
10    shall be printed more conspicuously  than  other  terminology
11    required by this Section.
12        (g)  At  the  time disclosures are made, the lender shall
13    deliver to the obligor  a  duplicate  of  the  instrument  or
14    statement  by  which the required disclosures are made and on
15    which  the  lender  and  obligor  are  identified  and  their
16    addresses stated.  All  of  the  disclosures  shall  be  made
17    clearly,  conspicuously  and  in meaningful sequence and made
18    together on either:
19             (i)  the note or  other  instrument  evidencing  the
20        obligation  on  the  same  side  of the page and above or
21        adjacent  to  the  place  for  the  obligor's  signature;
22        however, where a creditor elects to  combine  disclosures
23        with  the contract, security agreement, and evidence of a
24        transaction  in  a  single  document,   the   disclosures
25        required  under this Section shall be made on the face of
26        the document, on the reverse  side,  or  on  both  sides,
27        provided  that  the  amount of the finance charge and the
28        annual percentage rate shall appear on the  face  of  the
29        document,  and, if the reverse side is used, the printing
30        on both sides of the document shall be equally clear  and
31        conspicuous,  both  sides  shall  contain  the statement,
32        "NOTICE: See other side for important  information",  and
33        the  place for the customer's signature shall be provided
34        following the full content of the document; or
 
HB2538 Engrossed            -155-              LRB9201093JScs
 1             (ii)  one  side  of  a  separate   statement   which
 2        identifies the transaction.
 3        The  amount  of the finance charge shall be determined as
 4    the sum of all charges, payable directly or indirectly by the
 5    obligor and imposed directly or indirectly by the  lender  as
 6    an  incident to or as a condition to the extension of credit,
 7    whether paid or payable by the obligor, any other  person  on
 8    behalf  of  the  obligor,  to the lender or to a third party,
 9    including any of the following types of charges:
10             (1)  Interest,  time  price  differential,  and  any
11        amount payable  under  a  discount  or  other  system  of
12        additional charges.
13             (2)  Service,  transaction,  activity,  or  carrying
14        charge.
15             (3)  Loan  fee,  points,  finder's  fee,  or similar
16        charge.
17             (4)  Fee for an appraisal, investigation, or  credit
18        report.
19             (5)  Charges  or premiums for credit life, accident,
20        health,  or  loss  of  income   insurance,   written   in
21        connection  with  any  credit  transaction unless (a) the
22        insurance coverage is not required by the lender and this
23        fact is clearly and conspicuously disclosed in writing to
24        the obligor; and (b) any obligor desiring such  insurance
25        coverage  gives  specific  dated  and  separately  signed
26        affirmative  written  indication  of  such  desire  after
27        receiving  written  disclosure to him of the cost of such
28        insurance.
29             (6)  Charges or premiums for insurance,  written  in
30        connection  with  any credit transaction, against loss of
31        or damage to property or against liability arising out of
32        the  ownership  or  use  of  property,  unless  a  clear,
33        conspicuous,  and  specific  statement  in   writing   is
34        furnished  by the lender to the obligor setting forth the
 
HB2538 Engrossed            -156-              LRB9201093JScs
 1        cost of the insurance if obtained  from  or  through  the
 2        lender and stating that the obligor may choose the person
 3        through which the insurance is to be obtained.
 4             (7)  Premium   or   other   charges  for  any  other
 5        guarantee or insurance protecting the lender against  the
 6        obligor's default or other credit loss.
 7             (8)  Any  charge  imposed  by  a lender upon another
 8        lender for purchasing or accepting an  obligation  of  an
 9        obligor  if  the  obligor  is required to pay any part of
10        that charge in cash, as an addition to the obligation, or
11        as a deduction from the proceeds of the obligation.
12        A late payment, delinquency,  default,  reinstatement  or
13    other  such  charge  is  not  a finance charge if imposed for
14    actual unanticipated late payment,  delinquency,  default  or
15    other occurrence.
16        (h)  Advertising  for loans transacted under this Section
17    may not be false, misleading, or deceptive. That advertising,
18    if it states a rate or amount of interest,  must  state  that
19    rate  as  an  annual  percentage rate of interest charged. In
20    addition, if charges other than  for  interest  are  made  in
21    connection with those loans, those charges must be separately
22    stated.  No  advertising may indicate or imply that the rates
23    or  charges  for  loans  are  in   any   way   "recommended",
24    "approved", "set" or "established" by the State government or
25    by this Act.
26        (i)  A  lender  or creditor who complies with the federal
27    Truth in Lending Act, amendments thereto, and any regulations
28    issued or which may be issued thereunder, shall be deemed  to
29    be  in compliance with the provisions of subsections (f), (g)
30    and (h) of this Section.
31    (Source: P.A. 89-208, eff. 9-29-95; 90-437, eff. 1-1-98.)

32        Section 35.  The Banking Emergencies Act  is  amended  by
33    changing Sections 1 and 2 as follows:
 
HB2538 Engrossed            -157-              LRB9201093JScs
 1        (205 ILCS 610/1) (from Ch. 17, par. 1001)
 2        Sec.  1. Definitions. A.  As used in this Act, unless the
 3    context otherwise requires:
 4        (1)  "Commissioner"  means  the  officer  of  this  State
 5    designated by law to  exercise  supervision  over  banks  and
 6    trust  companies,  and  any  other person lawfully exercising
 7    such powers.
 8        (2)  "Bank" includes commercial  banks,  trust  companies
 9    and  any  branch thereof lawfully carrying on the business of
10    banking and, to the extent that the provisions hereof are not
11    inconsistent with and do not infringe upon paramount  Federal
12    law, also includes national banks.
13        (3)  "Officers" means the person or persons designated by
14    the  board  of directors, to act for the bank in carrying out
15    the provisions of this Act or, in the  absence  of  any  such
16    designation  or of the officer or officers so designated, the
17    president or any other officer currently  in  charge  of  the
18    bank or of the office or offices in question.
19        (4)  "Office"  means  any place at which a bank transacts
20    its business or conducts operations related to its business.
21        (5)  "Emergency" means any condition or occurrence  which
22    may  interfere physically with the conduct of normal business
23    operations at one or more or all of the offices of a bank, or
24    which poses an imminent or existing threat to the  safety  or
25    security  of  persons  or property, or both at one or more or
26    all of the offices of a bank.
27        Without limiting the  generality  of  the  foregoing,  an
28    emergency  may  arise  as  a result of any one or more of the
29    following: natural disasters; civil strife;  power  failures;
30    computer  failures; interruption of communication facilities;
31    robbery or attempted robbery.
32    (Source: P.A. 85-204.)

33        (205 ILCS 610/2) (from Ch. 17, par. 1002)
 
HB2538 Engrossed            -158-              LRB9201093JScs
 1        Sec. 2. Power of Commissioner. Whenever the  Commissioner
 2    is  notified  by  any officer of a bank or by any other means
 3    becomes aware that an emergency exists, or is  impending,  in
 4    the  county  or  municipality or any part thereof, he may, by
 5    proclamation, authorize all banks in the  State  of  Illinois
 6    located  in the affected area or areas to close any or all of
 7    their offices, or  if  only  a  bank  or  banks,  or  offices
 8    thereof,  in  a  particular  area  or  areas  of the State of
 9    Illinois  are  affected  by  the   emergency   or   impending
10    emergency,  the  Commissioner may authorize only the affected
11    bank, banks, or offices thereof, to  close.   The  office  or
12    offices  so  closed  may remain closed until the Commissioner
13    declares, by further  proclamation,  that  the  emergency  or
14    impending  emergency  has  ended.  The Commissioner during an
15    emergency or  while  an  impending  emergency  exists,  which
16    affects,  or  may  affect,  a  particular bank or banks, or a
17    particular office or offices thereof, but not  banks  located
18    in the area generally of the said county or municipality, may
19    authorize  the particular bank or banks, or office or offices
20    so affected, to close. The office or offices so closed  shall
21    remain  closed  until  the Commissioner is notified by a bank
22    officer of the closed bank that the emergency has ended.  The
23    Commissioner  shall notify, at such time, the officers of the
24    bank that one or more offices, heretofore closed  because  of
25    the  emergency,  should reopen and, in either event, for such
26    further time thereafter as  may  reasonably  be  required  to
27    reopen.
28    (Source: P.A. 77-1782.)

29        Section  40.  The  Corporate  Fiduciary Act is amended by
30    changing Sections 1-8, 3-1, 3-2, 4-3, 4-4, 4-5, 5-3, 5-6, and
31    6-2 and adding Article 4A as follows:

32        (205 ILCS 620/1-8) (from Ch. 17, par. 1551-8)
 
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 1        Sec. 1-8.  Change  of  name  or  location.   A  corporate
 2    fiduciary  holding a certificate of authority issued pursuant
 3    to this Act must notify and receive written approval from the
 4    Commissioner  before  changing  its  name  or  changing   the
 5    location   of   its   corporate  headquarters.   A  corporate
 6    fiduciary which is a State bank chartered by the Commissioner
 7    and which accomplishes a change of name  in  compliance  with
 8    Section  13  of  the  Illinois  Banking  Act  or  a change of
 9    location in compliance with Section 13  17  of  the  Illinois
10    Banking  Act, as now or hereafter amended, shall be deemed to
11    have complied with this Section 1-8.
12    (Source: P.A. 90-301, eff. 8-1-97.)

13        (205 ILCS 620/3-1) (from Ch. 17, par. 1553-1)
14        Sec. 3-1.  Merger.  The merger procedure  required  of  a
15    trust  company where there is to be a resulting trust company
16    by consolidation or merger shall be:
17        (1)  The board of directors of each party to  the  merger
18    merging  trust  company  shall,  by  a majority of the entire
19    board, approve a merger agreement which shall contain:
20             (a)  The name of each party to  the  merger  merging
21        trust company and its location and a list of each merging
22        party's  trust  company's  stockholders as of the date of
23        the merger agreement;
24             (b)  With respect to the resulting trust company (i)
25        its name and  place  of  business;  (ii)  the  amount  of
26        capital,  surplus  and  reserve  for  operating expenses;
27        (iii) the classes and the number of shares of  stock  and
28        the  par value of each share; (iv) the designation of the
29        continuing trust company and the charter which is  to  be
30        the charter of the resulting trust company, together with
31        the  amendments  to  the  continuing  charter  and to the
32        continuing  by-laws;  and  (v)   a   detailed   financial
33        statement  showing  the  assets and liabilities after the
 
HB2538 Engrossed            -160-              LRB9201093JScs
 1        proposed merger or consolidation;
 2             (c)  Provisions  stating  the  method,   terms   and
 3        conditions  of carrying the merger into effect, including
 4        the manner  of  converting  the  shares  of  the  merging
 5        parties trust companies into the cash, shares of stock or
 6        other securities of any corporation or other property, or
 7        any  combination  of  the foregoing, stated in the merger
 8        agreement as to be received by the stockholders  of  each
 9        merging party trust company;
10             (d)  A  statement  that  the agreement is subject to
11        approval by the Commissioner and by the  stockholders  of
12        each  party  to the merger merging trust company and that
13        whether approved  or  disapproved,  the  parties  to  the
14        merger    merging    trust   companies   will   pay   the
15        Commissioner's expenses of examination;
16             (e)  Provisions governing the manner of disposing of
17        the shares of the resulting trust company  not  taken  by
18        the  dissenting stockholders of the parties to the merger
19        merging trust companies; and
20             (f)  Such other provisions as the  Commissioner  may
21        reasonably  require to enable him to discharge his duties
22        with respect to the merger.
23        (2)  After approval by the board  of  directors  of  each
24    party to the merger trust company, the merger agreement shall
25    be  submitted to the Commissioner for approval, together with
26    certified copies of the authorizing resolutions of each board
27    of directors showing approval by a  majority  of  the  entire
28    board of each party to the merger trust company.
29        (3)  After  receipt  by  the  Commissioner  of the papers
30    specified in paragraph (2), he shall  approve  or  disapprove
31    the merger agreement.  The Commissioner shall not approve the
32    merger  agreement unless he shall be of the opinion and shall
33    find:
34             (a)  That the  resulting  trust  company  meets  the
 
HB2538 Engrossed            -161-              LRB9201093JScs
 1        requirements of this Act for the formation of a new trust
 2        company   at  the  proposed  place  of  business  of  the
 3        resulting trust company;
 4             (b)  That the same matters exist in respect  of  the
 5        resulting  trust  company  which would have been required
 6        under Section 2-6 of this Act for the organization  of  a
 7        new trust company.
 8        If  the  Commissioner  disapproves an agreement, he shall
 9    state his objection and give an opportunity to the parties to
10    the merger  merging  trust  companies  to  amend  the  merger
11    agreement to obviate such objections.
12    (Source: P.A. 88-408.)

13        (205 ILCS 620/3-2) (from Ch. 17, par. 1553-2)
14        Sec. 3-2.  Change in control.
15        (a)  Before  a  change  may  occur  in  the  ownership of
16    outstanding  stock  or  membership  interests  of  any  trust
17    company whether  by  sale  and  purchase,  gift,  bequest  or
18    inheritance, or any other means, which will result in control
19    or  a  change in the control of the trust company or before a
20    change in the control of a holding company having control  of
21    the  outstanding  stock  or  membership  interests of a trust
22    company whether  by  sale  and  purchase,  gift,  bequest  or
23    inheritance, or any other means, which will result in control
24    or  a  change  in  control  of  the  trust company or holding
25    company, the Commissioner shall be of the opinion and find:
26             (1)  that the  general  character  of  its  proposed
27        management,  after  the  change in control, is such as to
28        assure reasonable promise of competent, successful,  safe
29        and sound operation;
30             (2)  that  the  future earnings prospects, after the
31        proposed change in control, are favorable; and
32             (3)  that the prior business affairs of the  persons
33        proposing to obtain control or by the proposed management
 
HB2538 Engrossed            -162-              LRB9201093JScs
 1        personnel,  whether  as  stockholder,  director,  member,
 2        officer,  or  customer,  were conducted in a safe, sound,
 3        and lawful manner.
 4        (b)  Persons desiring to purchase control of an  existing
 5    trust  company and persons obtaining control by gift, bequest
 6    or inheritance, or  any  other  means  shall  submit  to  the
 7    Commissioner:
 8             (1)  A statement of financial worth; and
 9             (2)  Satisfactory  evidence  that the prior business
10        affairs  of  the  persons  and  the  proposed  management
11        personnel, whether as stockholder, director, officer,  or
12        customer,  were  conducted  in  a safe, sound, and lawful
13        manner.
14        As used in this Section, the  term  "control"  means  the
15    ownership  of such amount of stock or membership interests or
16    ability to direct the voting  of  such  stock  or  membership
17    interests as to give power to, directly or indirectly, direct
18    or  cause  the direction of the management or policies of the
19    trust company.  A change in ownership of  stock  which  would
20    result  in  direct  or indirect ownership by a stockholder or
21    member, an affiliated group of stockholders or members  or  a
22    holding  company of less than 10% of the outstanding stock or
23    membership interests shall not  be  considered  a  change  of
24    control.   A  change  in  ownership  of  stock  or membership
25    interests which would result in direct or indirect  ownership
26    by   a   stockholder   or  member,  an  affiliated  group  of
27    stockholders or members or a holding company of 20%  or  such
28    lesser  amount  which  would  entitle  the holder by applying
29    cumulative voting to elect one director shall be presumed  to
30    constitute  a change of control for purposes of this Section.
31    If there is any doubt as to whether a change in the ownership
32    or control of the outstanding stock or  membership  interests
33    is  sufficient  to  result in obtaining control thereof or to
34    effect a change in the control thereof, such doubt  shall  be
 
HB2538 Engrossed            -163-              LRB9201093JScs
 1    resolved in favor of reporting the facts to the Commissioner.
 2        (c)  Whenever  a  bank makes a loan or loans, secured, or
 3    to be secured, by 25% or more of the outstanding stock  of  a
 4    trust company, the president or other chief executive officer
 5    of  the  lending  bank shall promptly report such fact to the
 6    Commissioner upon obtaining knowledge of such loan or  loans,
 7    except  that  no report need be made in those cases where the
 8    borrower has been the owner of record  of  the  stock  for  a
 9    period  of  one  year  or  more,  or  the  stock is that of a
10    newly-organized trust company prior to its opening.
11        (d) (1)  Before  a  purchase  of  substantially  all  the
12    assets and an assumption of substantially all the liabilities
13    of  a trust company or before a purchase of substantially all
14    the trust assets and an assumption of substantially  all  the
15    trust  liabilities of a trust company, the Commissioner shall
16    be of the opinion and find:
17             (i)  that the general character  of  the  acquirer's
18        proposed  management,  after  the transfer, is such as to
19        assure reasonable promise of competent, successful, safe,
20        and sound operation;
21             (ii)  that the acquirer's future earnings prospects,
22        after the proposed transfer, are favorable;
23             (iii)  that any prior involvement by the acquirer or
24        by  the  proposed  management   personnel,   whether   as
25        stockholder,  director,  officer, agent, or customer, was
26        conducted in a safe, sound, and lawful manner;
27             (iv)  that  customers'   interests   will   not   be
28        jeopardized by the purchase and assumption; and
29             (v)  that  adequate  provision has been made for all
30        obligations and trusts as required under Section  7-1  of
31        this Act.
32        (2)  Persons  desiring  to purchase substantially all the
33    assets and assume substantially  all  the  liabilities  of  a
34    trust  company  or  to  purchase  substantially all the trust
 
HB2538 Engrossed            -164-              LRB9201093JScs
 1    assets and assume substantially all the trust liabilities  of
 2    a trust company shall submit to the Commissioner:
 3             (i)  a statement of financial worth; and
 4             (ii)  satisfactory  evidence that the prior business
 5        affairs  of  the  persons  and  the  proposed  management
 6        personnel, whether as stockholder, director, officer,  or
 7        customer,  were  conducted  in  a safe, sound, and lawful
 8        manner.
 9        As used in this Section, "substantially all"  the  assets
10    or  liabilities or the trust assets or trust liabilities of a
11    trust company means that portion  such  that  their  transfer
12    will  materially  impair  the ability of the trust company to
13    continue  successful,  safe,  and  sound  operations  or   to
14    continue as a going concern.
15        (e)  The  reports  required  by subsections (a),(b), (c),
16    and (d) of this  Section  3-2  shall  contain  the  following
17    information  to  the  extent  that  it is known by the person
18    making the report: (1) the number of shares involved; (2) the
19    names of the sellers (or transferors); (3) the names  of  the
20    purchasers  (or transferees); (4) the names of the beneficial
21    owners if the shares are registered in another name; (5)  the
22    purchase  price;  (6) the total number of shares owned by the
23    sellers (or transferors), the purchasers (or transferees) and
24    the beneficial owners both immediately before and  after  the
25    transaction;  and, (7) in the case of a loan, the name of the
26    borrower, the amount of the loan, and the name of  the  trust
27    company issuing the stock securing the loan and the number of
28    shares securing the loan.  In addition to the foregoing, such
29    reports  shall  contain  such  other  information  as  may be
30    available and which  is  requested  by  the  Commissioner  to
31    inform the Commissioner of the effect of the transaction upon
32    the  trust  company  or trust companies whose stock or assets
33    and liabilities are involved.
34        (f)  Whenever such a change as  described  in  subsection
 
HB2538 Engrossed            -165-              LRB9201093JScs
 1    (a)  of  this  Section  3-2  occurs, each trust company shall
 2    report  promptly  to  the   Commissioner   any   changes   or
 3    replacement of its chief executive officer or of any director
 4    occurring  in  the  next  12  month  period, including in its
 5    report a statement of  the  past  and  current  business  and
 6    professional  affiliations of the new chief executive officer
 7    or directors.
 8        (g)  The provisions of this Section do not apply when the
 9    change  in  control   is   the   result   of   organizational
10    restructuring under a holding company.
11        (h)  As   used  in this Section, the term "control" means
12    the ownership of such amount of stock or membership interests
13    or ability to direct the voting of such stock or   membership
14    interests   as  to,  directly  or  indirectly,  give power to
15    direct or cause the direction of the  management or  policies
16    of the trust company.  A change in ownership  of  stock  that
17    would result in direct or indirect ownership by a stockholder
18    or member, an affiliated group of stockholders or members, or
19    a holding  company  of less than 10% of the outstanding stock
20    or  membership  interests shall not be  considered  a  change
21    of control.  A change in ownership  of  stock  or  membership
22    interests  that would result in direct or indirect  ownership
23    by  a  stockholder  or  member,  an   affiliated   group   of
24    stockholders  or members, or a holding company of 20% or such
25    lesser amount which would  entitle  the  holder  by  applying
26    cumulative  voting to elect one director shall be presumed to
27    constitute a change of control for purposes of this  Section.
28    If  there  is  any  question  as  to  whether a change in the
29    ownership or control of the outstanding stock  or  membership
30    interests  is  sufficient  to  result  in  obtaining  control
31    thereof  or  to  effect  a change in the control thereof, the
32    question shall be resolved in favor of reporting the facts to
33    the Commissioner.
34        As  used  in   this   Section,  "substantially  all"  the
 
HB2538 Engrossed            -166-              LRB9201093JScs
 1    assets   or   liabilities   or  the  trust  assets  or  trust
 2    liabilities of a trust company means that portion  such  that
 3    their  transfer  will  materially  impair  the ability of the
 4    trust   company  to  continue  successful,  safe,  and  sound
 5    operations or to continue as a going concern.
 6    (Source: P.A. 89-364, eff. 8-18-95; 90-424, eff. 1-1-98.)

 7        (205 ILCS 620/4-3) (from Ch. 17, par. 1554-3)
 8        Sec. 4-3.  Service of process upon  Secretary  of  State.
 9    Any  foreign  corporation acting in this State in a fiduciary
10    capacity pursuant to the provisions of Article IV and Article
11    IVA of this  Act  shall  be  deemed  to  have  appointed  the
12    Secretary  of  State  to be its true and lawful attorney upon
13    whom may be  served  all  legal  process  in  any  action  or
14    proceeding  against  it  relating  to  or  growing out of any
15    trust, estate or matter in  respect  of  which  such  foreign
16    corporation  has acted or is acting in this state in any such
17    fiduciary capacity, and the acceptance of  or  engagement  in
18    this  State  in any acts in any such fiduciary capacity shall
19    be signification of  its  agreement  that  any  such  process
20    against  it  which  is  so served, shall be of the same legal
21    force and validity  as  though  served  upon  it  personally.
22    Service  of  such  process shall be made by delivering to the
23    Secretary of State, the corporation department of the  office
24    a  copy of such process, together with the fee for service of
25    process required by the Secretary of State, and such  service
26    shall  be sufficient service upon said foreign corporation if
27    notice of such service and a copy of the process are,  within
28    10  days thereafter, sent by registered mail by the plaintiff
29    to the defendant at its principal office in such other  state
30    or  territory  and  the  plaintiff's  affidavit of compliance
31    herewith is appended to the summons.  The court in which  the
32    action  is  pending  may  order  such  continuances as may be
33    necessary to afford the defendant reasonable  opportunity  to
 
HB2538 Engrossed            -167-              LRB9201093JScs
 1    defend  the  action.   The  fee  paid by the plaintiff to the
 2    Secretary of  State  at  the  time  of  the  service  may  be
 3    recovered  as  taxable  costs  by the plaintiff if such party
 4    prevails in the action.  The Secretary of State shall keep  a
 5    record  of all process served upon him under this section and
 6    shall record therein the time of such service.
 7    (Source: P.A. 85-858.)

 8        (205 ILCS 620/4-4) (from Ch. 17, par. 1554-4)
 9        Sec. 4-4.  Place of business not  to  be  established  in
10    State; not deemed transacting business.
11        (a)  A  foreign corporation, as defined in Section 1-5.08
12    of this Act, shall not establish in this  State  a  place  of
13    business,  branch  office,  or  agency  for  the  conduct  of
14    business  as  a  fiduciary and because it is not permitted to
15    establish in this State a place of business, branch office or
16    agency, a  foreign  corporation  insofar  as  it  acts  in  a
17    fiduciary  capacity  in this State pursuant to the provisions
18    of this Act shall not be deemed to be transacting business in
19    this State.  The  foreign  corporation  may  apply  for,  and
20    procure  from  the  Commissioner,  a  license  to establish a
21    representative  office   pursuant   to   the   Foreign   Bank
22    Representative Office Act.
23        The  provisions  of  this  subsection (a) do not apply to
24    foreign   corporations   establishing   or   acquiring    and
25    maintaining  a  place  of  business  in this State to conduct
26    business as a fiduciary in accordance  with  Article  IVA  of
27    this Act.
28        (b)  Notwithstanding  subsection (a) of this Section 4-4,
29    after May 31, 1997, a branch  of  an  out-of-state  bank,  as
30    defined  in  Section  2  of  the  Illinois Banking Act, and a
31    foreign association, as defined in  Section  1-10.31  of  the
32    Illinois  Savings  and  Loan  Act  of  1985, may establish an
33    office in this  State  for  the  conduct  of  business  as  a
 
HB2538 Engrossed            -168-              LRB9201093JScs
 1    fiduciary, provided: (i) fiduciary business conducted in this
 2    State  by  a  branch  of  an  out-of-state bank is subject to
 3    examination  by  the  Commissioner;  and   (ii)   the   trust
 4    activities of the branch of the out-of-state bank are subject
 5    to   regulation,   including   enforcement  actions,  by  the
 6    Commissioner  to  the  same  extent  as  Illinois   corporate
 7    fiduciaries.
 8    (Source: P.A. 90-665, eff. 7-30-98; 91-97, eff. 7-9-99.)

 9        (205 ILCS 620/4-5) (from Ch. 17, par. 1554-5)
10        Sec. 4-5.  Certificate of authority; fees; certificate of
11    reciprocity.
12        (a)  Prior  to  the  time any foreign corporation acts in
13    this State as testamentary trustee, trustee appointed by  any
14    court,  trustee  under  any written agreement, declaration or
15    instrument of trust, executor,  administrator,  administrator
16    to collect, guardian or in any other like fiduciary capacity,
17    such  foreign  corporation shall apply to the Commissioner of
18    Banks and Real Estate for a  certificate  of  authority  with
19    reference  to  the  fiduciary capacity or capacities in which
20    such foreign corporation proposes to act in this  State,  and
21    the  Commissioner  of  Banks  and  Real  Estate shall issue a
22    certificate of authority to such corporation concerning  only
23    the fiduciary capacity or such of the fiduciary capacities to
24    which  the  application pertains and with respect to which he
25    has been furnished satisfactory evidence  that  such  foreign
26    corporation  meets  the  requirements  of Section 4-2 of this
27    Act.  The  certificate  of  authority  shall  set  forth  the
28    fiduciary  capacity  or  capacities,  as the case may be, for
29    which the certificate is issued, and shall recite and certify
30    that such foreign corporation is  eligible  to  act  in  this
31    State  in  such fiduciary capacity or capacities, as the case
32    may  be,  pursuant  to  the  provisions  of  this  Act.   The
33    certificate of authority  shall  remain  in  full  force  and
 
HB2538 Engrossed            -169-              LRB9201093JScs
 1    effect  until such time as such foreign corporation ceases to
 2    be eligible so to act under the provisions of this Act.
 3        (b)  Each foreign corporation making  application  for  a
 4    certificate  of  authority  shall  pay reasonable fees to the
 5    Commissioner of Banks and Real Estate as  determined  by  the
 6    Commissioner for the services of his office.
 7        (c)  Any  foreign  corporation  holding  a certificate of
 8    reciprocity which recites and  certifies  that  such  foreign
 9    corporation  is  eligible  to  act  in this State in any such
10    fiduciary capacity pursuant to the provisions of  Article  IV
11    of  this  Act  or  any predecessor Act upon the same subject,
12    issued prior to the effective date of this amendatory Act  of
13    1987  may  act  in  this  State  under  such  certificate  of
14    reciprocity  in  any such fiduciary capacity without applying
15    for a new certificate  of  authority.   Such  certificate  of
16    reciprocity  shall remain in full force and effect until such
17    time as such foreign corporation ceases to be eligible so  to
18    act under the provisions of Article IV of this Act.
19        (d)  Any  foreign  corporation acting in Illinois under a
20    certificate of authority  or  a  certificate  of  reciprocity
21    shall   report   changes  in  its  name  or  address  to  the
22    Commissioner and shall notify the Commissioner when it is  no
23    longer serving as a corporate fiduciary in Illinois.
24        (e)  The  provisions of this Section shall not apply to a
25    foreign corporation establishing or acquiring and maintaining
26    a place of business in this State to conduct  business  as  a
27    fiduciary in accordance with Article IVA of this Act.
28    (Source: P.A. 89-508, eff. 7-3-96.)

29        (205 ILCS 620/Art. IVA heading new)
30               ARTICLE IVA MULTISTATE TRUST ACTIVITIES

31        (205 ILCS 620/4A-1 new)
32        Sec. 4A-1.  Corporate fiduciaries establishing offices in
 
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 1    other states.
 2        (a)  A  corporate  fiduciary  may  act  as a fiduciary or
 3    otherwise engage in fiduciary activities in this or any other
 4    state  or  foreign  country,  subject   to   complying   with
 5    applicable  laws  of  that  state  or  foreign country, at an
 6    office established and maintained pursuant to this Act, at  a
 7    branch, or at any location other than an office or branch.  A
 8    corporate  fiduciary seeking to establish or acquire a branch
 9    in another state or foreign  country  must  comply  with  the
10    notice provisions in Section 1-7 of this Act.
11        (b)  A   corporate   fiduciary   may   also  conduct  any
12    activities  at  any  office   outside   Illinois   that   are
13    permissible  for  a  trust institution chartered by the state
14    where the office is  located,  except  to  the  extent  those
15    activities  are  expressly prohibited by the laws of Illinois
16    or by any regulation or order of the Commissioner.   However,
17    the  Commissioner  may  waive  any  such  prohibition  if  he
18    determines,  by  order or regulation, that the involvement of
19    out-of-state  offices  of  state  corporate  fiduciaries   in
20    particular  activities  would  not  threaten  the  safety  or
21    soundness of those state corporate fiduciaries.

22        (205 ILCS 620/4A-5 new)
23        Sec.  4A-5.  Foreign  corporations establishing places of
24    business to conduct fiduciary activities in Illinois.
25        (a)  A foreign corporation may establish or  acquire  and
26    maintain a place of business for the conduct of business as a
27    fiduciary  in  this State provided that a corporate fiduciary
28    that has its principal  place  of  business  in  Illinois  is
29    permitted  to  establish  or  acquire  and maintain a similar
30    place of business that may engage in activities substantially
31    similar to those permitted to foreign corporations under this
32    Act in the  state  where  the  foreign  corporation  has  its
33    principal place of business.
 
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 1        (b)  A  foreign  corporation  desiring  to  establish  or
 2    acquire  and maintain a place of business to conduct business
 3    as a fiduciary in Illinois under this Section shall  provide,
 4    or  cause its home state regulator to provide, written notice
 5    of the proposed transaction to the Commissioner on  or  after
 6    the date on which the foreign corporation applies to its home
 7    state  regulator  for  approval  to  establish or acquire and
 8    maintain a place of business in Illinois.  The filing of  the
 9    notice  shall  be  preceded  or  accompanied by a copy of the
10    resolution adopted by the board  authorizing  the  additional
11    place  of  business  and  the  filing  fee  required  by  the
12    Commissioner.  The Commissioner may prescribe the form of the
13    notice  required  under  this Section.  In the Commissioner's
14    discretion,  the  application  or  notice  submitted  to  the
15    foreign corporation's home state regulator may be  sufficient
16    notice under this Section.
17        (c)  A  foreign  corporation  desiring  to  establish  or
18    acquire  and maintain a place of business to conduct business
19    as  a  fiduciary  shall  (i)  confirm  in  writing   to   the
20    Commissioner  that  for  as  long  as it maintains a place of
21    business in Illinois, it will comply with the  laws  of  this
22    State   and   (ii)   provide  satisfactory  evidence  to  the
23    Commissioner of compliance with any  applicable  requirements
24    of   state   foreign   corporation   qualification  laws  and
25    applicable requirements  of  its  home  state  regulator  for
26    acquiring or establishing and maintaining the office.
27        (d)  A  foreign  corporation  submitting  a notice to the
28    Commissioner in accordance with subsection (b)  may  commence
29    fiduciary  business  at  the  place of business listed in its
30    notice on the  61st  day  after  the  date  the  Commissioner
31    receives  the  notice  unless  the  Commissioner specifies an
32    earlier or later date.  However, if the  foreign  corporation
33    is not a depository institution and the Commissioner approves
34    the  foreign  corporation  to conduct a fiduciary business in
 
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 1    Illinois  subject  to  specific   conditions,   the   foreign
 2    corporation  shall  not  commence  a  fiduciary  business  in
 3    Illinois until it has satisfied those conditions and provided
 4    evidence  satisfactory  to  the Commissioner that it has done
 5    so. The Commissioner may extend the 60-day review  period  if
 6    additional  time or information is needed for approval of the
 7    notice.  The Commissioner may deny approval of the notice  if
 8    he  finds  that  the  foreign  corporation  lacks  sufficient
 9    financial  resources  to  undertake  the  proposed  expansion
10    without  adversely  affecting its safety or soundness or that
11    the place of business is contrary to the public interest.

12        (205 ILCS 620/4A-10 new)
13        Sec. 4A-10.  Additional places of  business  for  foreign
14    corporations.  A  foreign  corporation  that  establishes  or
15    acquires  and  maintains  a  place  of  business  to  conduct
16    business  as a fiduciary in Illinois pursuant to Section 4A-5
17    may  establish  or  acquire  additional  trust   offices   or
18    representative  offices in this State to the same extent that
19    a corporate fiduciary may  establish  or  acquire  additional
20    offices in Illinois under Section 1-7 of this Act.

21        (205 ILCS 620/4A-15 new)
22        Sec.    4A-15.  Representative    offices.    A   foreign
23    corporation not conducting fiduciary activities may establish
24    a representative office under the Foreign Bank Representative
25    Office Act.  At these offices, the  foreign  corporation  may
26    market and solicit fiduciary services and provide bank office
27    and  administrative  support  to  the  foreign  corporation's
28    fiduciary  activities,  but  it  may  not engage in fiduciary
29    activities.

30        (205 ILCS 620/4A-20 new)
31        Sec. 4A-20.  Examination of foreign corporations.
 
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 1        (a)  To the extent consistent with subsection (c) of this
 2    Section, the Commissioner may make such examinations  of  any
 3    place  of  business  established  or maintained under Section
 4    4A-5 by a foreign corporation as the  Commissioner  may  deem
 5    necessary to determine whether the place of business is being
 6    operated  in  compliance  with  the laws of this State and in
 7    accordance  with  safe  and  sound  banking  practices.   The
 8    provisions of Section 5-2 of this  Act  shall  apply  to  the
 9    examinations.
10        (b)  The   Commissioner   may  require  periodic  reports
11    regarding any foreign corporation that has maintained a place
12    of business in this State under Section 4A-5.   The  required
13    reports  shall  be  provided by the foreign corporation or by
14    the  home  state  regulator.   Any   reporting   requirements
15    prescribed  by  the  Commissioner under this Section shall be
16    consistent with Section 5-9 of this Act.
17        (c)  The  Commissioner  may   enter   into   cooperative,
18    coordinating,  and  information-sharing  agreements  with any
19    other  bank  supervisory   agencies   or   any   organization
20    affiliated  with or representing one or more bank supervisory
21    agencies with respect to the periodic  examination  or  other
22    supervision  of  any  office  in  this  State  of  a  foreign
23    corporation  or any office of a corporate fiduciary in a host
24    state.  The Commissioner may accept a report  of  examination
25    or  report  of  investigation  in  lieu  of  the Commissioner
26    conducting an examination or investigation.
27        (d)  The Commissioner may enter into contracts  with  any
28    bank supervisory agency that has concurrent jurisdiction over
29    a  corporate  fiduciary  or foreign corporation maintaining a
30    place of business under Section 4A-5 of this  Act  to  engage
31    the  services of that agency's examiners at a reasonable rate
32    of  compensation  or  to  provide   the   services   of   the
33    Commissioner's  examiners to that agency at a reasonable rate
34    of compensation.
 
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 1        (e)  The Commissioner may  enter  joint  examinations  or
 2    joint   enforcement   actions  with  other  bank  supervisory
 3    agencies having concurrent jurisdiction  over  any  place  of
 4    business  established  under  Section 4A-5 or any office of a
 5    corporate fiduciary in any host state.  The Commissioner  may
 6    at   any   time   take  such  actions  independently  if  the
 7    Commissioner  deems  such  actions   to   be   necessary   or
 8    appropriate to ensure compliance with the laws of this State.
 9    However,   in   the   case  of  a  foreign  corporation,  the
10    Commissioner shall recognize the exclusive authority  of  the
11    home  state  regulator  over corporate governance matters and
12    the primary responsibility of the home state  regulator  over
13    safety and soundness matters.
14        (f)  A  foreign  corporation  that  maintains one or more
15    offices pursuant to Section 4A-5  may  be  assessed,  and  if
16    assessed,  shall  pay  supervisory  and  examination  fees in
17    accordance with Section 5-10 of this Act.  The  fees  may  be
18    shared   with   other   bank   supervisory  agencies  or  any
19    organization affiliated with or representing one or more bank
20    supervisory agencies in accordance  with  agreements  between
21    such parties and the Commissioner.

22        (205 ILCS 620/4A-25 new)
23        Sec.   4A-25.  Notice   to   Commissioner.   A  corporate
24    fiduciary that maintains a place of business  in  this  State
25    under  Section  4A-5,  or  the  home  state regulator of such
26    foreign corporation,  shall  give  at  least  30  days  prior
27    written  notice  or, in the case of an emergency transaction,
28    such shorter notice as is consistent with applicable state or
29    federal law, to the Commissioner of:
30             (1)  any merger, consolidation, or other transaction
31        that would cause a change in control with respect to  the
32        foreign  corporation  or  any  bank  holding company that
33        controls the corporation;
 
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 1             (2)  any transfer of all or substantially all of the
 2        trust accounts or trust assets of the foreign corporation
 3        to another person; or
 4             (3)  the closing or  disposition  of  any  place  of
 5        business in this State.

 6        (205 ILCS 620/5-3) (from Ch. 17, par. 1555-3)
 7        Sec. 5-3.  Violations; orders.
 8        (a)  Whenever  it  appears  to  the Commissioner from any
 9    examination, statement  of  condition  or  report,  that  any
10    corporate  fiduciary  has committed any violation of law, has
11    made or published  a  false  statement  of  condition  or  is
12    conducting its business in an unsafe, unsound or unauthorized
13    manner, he shall, by an order under his signature, direct the
14    discontinuance   of  such  illegal  and  unsafe,  unsound  or
15    unauthorized  practices  and  that  the  corporate  fiduciary
16    strictly conform with the requirements of the law,  and  with
17    safety and security in its transactions.
18        (b)  If a corporate fiduciary refuses or neglects to make
19    a  required  statement  of  condition  or any report required
20    under this Act, or to comply with an order as  above  stated,
21    or  if  it  appears  to the Commissioner that it is unsafe or
22    inexpedient for the such corporate fiduciary to  continue  to
23    transact business, or that extraordinary withdrawals of money
24    are  jeopardizing  the  interests of remaining depositors, or
25    that any  corporate  fiduciary  or  officer  of  a  corporate
26    fiduciary  has abused his trust or is guilty of misconduct in
27    his official position, injurious to the corporate  fiduciary,
28    or  that  it  has  suffered a serious loss, he shall enter an
29    order appropriate to the circumstances, which may include the
30    appointment of a receiver as hereinafter provided, the taking
31    of possession of the corporate fiduciary, or the removal of a
32    director,  officer,  employee,  or  agent  of  the  corporate
33    fiduciary, or he may, represented by  the  Attorney  General,
 
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 1    seek an injunction or other appropriate order from the court.
 2        (c)  No  dividends shall be paid by a corporate fiduciary
 3    while it continues its business as a corporate  fiduciary  to
 4    an  amount  greater  than  its  net  profits  then  on  hand,
 5    deducting first therefrom its losses and bad debts.
 6    (Source: P.A. 86-754.)

 7        (205 ILCS 620/5-6) (from Ch. 17, par. 1555-6)
 8        Sec.  5-6.  Removal  orders.  Whenever, in the opinion of
 9    the Commissioner, any director, officer, employee,  or  agent
10    of a corporate fiduciary or subsidiary or corporate parent of
11    the corporate fiduciary shall have violated any law, rule, or
12    order  relating  to  the corporate fiduciary or subsidiary or
13    corporate parent  of  the  corporate  fiduciary,  shall  have
14    engaged  in  an  unsafe or unsound practice in conducting the
15    business  of  the  corporate  fiduciary  or   subsidiary   or
16    corporate  parent  of  the corporate fiduciary, or shall have
17    violated any law or engaged or participated in any unsafe  or
18    unsound practice in connection with any financial institution
19    or  other business entity such that the character and fitness
20    of the director, officer, employee, or agent does not  assure
21    reasonable  promise  of  safe  and  sound  operation  of  the
22    corporate  fiduciary or subsidiary or corporate parent of the
23    corporate fiduciary, the Commissioner may issue an  order  of
24    removal.  If  in  the opinion of the Commissioner, any former
25    director,  officer,  employee,  or  agent  of   a   corporate
26    fiduciary  or subsidiary or corporate parent of the corporate
27    fiduciary, prior to the termination of  his  or  her  service
28    with  the  corporate  fiduciary  or  subsidiary  or corporate
29    parent of the corporate fiduciary, violated any law, rule, or
30    order relating to the corporate fiduciary  or  subsidiary  or
31    corporate  parent of the corporate fiduciary or engaged in an
32    unsafe or unsound practice in conducting the business of  the
33    corporate  fiduciary or subsidiary or corporate parent of the
 
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 1    corporate  fiduciary  or  violated  any  law  or  engaged  or
 2    participated in any unsafe or unsound practice in  connection
 3    with  any financial institution or other business entity such
 4    that the character and  fitness  of  the  director,  officer,
 5    employee,  or agent would not have assured reasonable promise
 6    of safe and sound operation of  the  corporate  fiduciary  or
 7    subsidiary  or  corporate  parent of the corporate fiduciary,
 8    the Commissioner may issue an order prohibiting  that  person
 9    from further service with a corporate fiduciary or subsidiary
10    or corporate parent of the corporate fiduciary as a director,
11    officer, employee, or agent. An order issued pursuant to this
12    Section shall be served upon the director, officer, employee,
13    or agent.  A copy of the order shall be sent to each director
14    of  the  corporate  fiduciary  affected  by personal service,
15    certified mail return receipt requested, or any other  method
16    that  provides  proof  of  service  and  receipt.  The person
17    affected by the action may request a hearing before the State
18    Banking Board of Illinois, hereafter "the Board",  within  10
19    days  after  receipt  of the order of removal or prohibition.
20    The hearing shall be held by the Board according to the  same
21    procedures  used  pursuant  to  Section  48  of  the Illinois
22    Banking Act, and the hearing shall be  held  within  30  days
23    after  the  request  has  been  received by the Board.  After
24    concluding the hearing, the Board shall make a  determination
25    approving,  modifying,  or  disapproving  the  order  of  the
26    Commissioner as its final administrative decision.  A copy of
27    the  order  shall  be  served upon the corporate fiduciary of
28    which the person is a director, officer, employee, or  agent,
29    whereupon  the  person shall cease to be a director, officer,
30    employee, or agent of the corporate  fiduciary.   Any  person
31    who  has  been  removed  or  prohibited  by  an  order of the
32    Commissioner under this Section or subsection (7) of  Section
33    48  of  the  Illinois Banking Act may not thereafter serve as
34    director, officer, employee, or agent of any  State  bank  or
 
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 1    corporate  fiduciary,  or of any other entity that is subject
 2    to licensure or regulation by the Commissioner or the  Office
 3    of  Banks and Real Estate unless the Commissioner has granted
 4    prior approval in writing.   The Commissioner may institute a
 5    civil action against  the  director,  officer,  employee,  or
 6    agent  subject  to  an  order  issued  under this Section and
 7    against the corporate fiduciary to enforce compliance with or
 8    to enjoin any violation of the terms of the order.
 9    (Source: P.A. 90-301, eff. 8-1-97; 90-665, eff. 7-30-98.)

10        (205 ILCS 620/6-2) (from Ch. 17, par. 1556-2)
11        Sec. 6-2.  Control by Commissioner.
12        (a)  If the Commissioner  with  respect  to  a  corporate
13    fiduciary shall find:
14        (1)  Its  capital  is  impaired  or it is otherwise in an
15    unsound condition; or
16        (2)  Its business  is  being  conducted  in  an  unlawful
17    manner,  including,  without  limitation, in violation of any
18    provisions of this Act or of an order of the Commissioner, or
19    in a fraudulent or unsafe manner; or
20        (3)  It is unable to continue operations; or
21        (4)  Its examination has been obstructed or impeded;  the
22    Commissioner may give notice to the board of directors of the
23    corporate  fiduciary  of  his  finding  or  findings.  If the
24    situation so found by the Commissioner shall not be corrected
25    to his satisfaction within 60  days  after  receipt  of  such
26    notice,  the  Commissioner at the termination of said 60 days
27    may shall  take  possession  and  control  of  the  corporate
28    fiduciary,  its  assets, and assets held for beneficiaries of
29    its fiduciary obligations, as in this Act  provided  for  the
30    purpose of examination, reorganization or liquidation through
31    receivership.
32        (b)  If,   in  addition  to  a  finding  as  provided  in
33    subsection (a) of this Section, the Commissioner shall be  of
 
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 1    the opinion and shall find that an emergency exists which may
 2    result  in  serious  losses to the beneficiaries of fiduciary
 3    relationships with the corporate fiduciary, he  may,  in  his
 4    discretion,  without  having given the notice provided for in
 5    subsection  (a)  of  this  Section,  and   whether   or   not
 6    proceedings  under  subsection  (a) of this Section have been
 7    instituted or are then pending, forthwith take possession and
 8    control of the corporate fiduciary and  its  assets  for  the
 9    purpose of examination, reorganization or liquidation through
10    receivership.
11    (Source: P.A. 85-858.)

12        Section 45.  The Foreign Banking Office Act is amended by
13    changing Sections 11 and 12 as follows:

14        (205 ILCS 645/11) (from Ch. 17, par. 2718)
15        Sec.    11.  Pledging    requirements;    discretion   of
16    Commissioner.   A  foreign  banking  corporation  holding   a
17    certificate  of  authority issued pursuant to this Act may be
18    required,  when  deemed  necessary  and  appropriate  in  the
19    opinion of the Commissioner, to  keep  on  deposit  with  the
20    Federal  Reserve  Bank  of  Chicago  or  such  State  bank or
21    national  bank  as  such  foreign  banking  corporation   may
22    designate  and the Commissioner may approve, interest-bearing
23    stocks and bonds, notes, debentures or other  obligations  of
24    the United States or any agency or instrumentality thereof or
25    guaranteed  by  the  United States, or of this State, or of a
26    city,   county,   town,   village,   school   district,    or
27    instrumentality of this State or guaranteed by this State, or
28    dollar deposits, or obligations of the International Bank for
29    Reconstruction  and Development, or obligations issued by the
30    Inter-American Development Bank, or obligations of the  Asian
31    Development  Bank,  or obligations of the African Development
32    Bank,   or   obligations   of   the   International   Finance
 
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 1    Corporation, or such other assets as the  Commissioner  shall
 2    permit,  to  an aggregate amount, based upon principal amount
 3    or market value, whichever is  lower,  in  the  case  of  the
 4    above-described  securities,  and subject to such limitations
 5    as he shall prescribe, such amount as the Commissioner  deems
 6    necessary  for  the  protection of depositors or the costs of
 7    taking possession and control of not less than the greater of
 8    $100,000 or 5% of the total liabilities (including contingent
 9    liabilities of such banking  office,  including  acceptances,
10    but  excluding  (i)  accrued  expenses,  (ii) amounts due and
11    other liabilities to other offices, agencies or branches  of,
12    and  wholly-owned  (except for a nominal number of directors'
13    shares) subsidiaries of, such  foreign  banking  corporation,
14    and (iii) such contingent liabilities as the Commissioner may
15    exclude.  The  deposit  shall  be maintained with the Federal
16    Reserve Bank of Chicago or any such State  bank  or  national
17    bank  pursuant  to  a  deposit  agreement  in  such  form and
18    containing  such  conditions  and  limitations  (including  a
19    deposit in the name of the  Commissioner  in  trust  for  the
20    depositors  of  such  banking office) as the Commissioner may
21    prescribe. So long as it continues business in  the  ordinary
22    course  such  banking  office shall, however, be permitted to
23    collect interest on the securities so deposited and from time
24    to time exchange, examine and compare such securities.
25    (Source: P.A. 89-208, eff. 6-1-97; 90-301, eff. 8-1-97.)

26        (205 ILCS 645/12) (from Ch. 17, par. 2719)
27        Sec. 12.  Control by Commissioner.
28        (a)  Upon the Commissioner's taking possession,  pursuant
29    to  Section  53  of the Illinois Banking Act, of the business
30    and property in this State of the banking office of a foreign
31    banking corporation whose deposit liabilities in  this  State
32    are not insured by the Federal Deposit Insurance Corporation,
33    the  amounts deposited pursuant to Section 11 shall thereupon
 
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 1    become the property of the Commissioner, free  and  clear  of
 2    any  and all liens and other claims, and shall be held by the
 3    Commissioner him in trust for the depositors of such  banking
 4    office.   The   Commissioner   may,  without  regard  to  any
 5    priorities,  preferences,  or  adverse  claims  and   without
 6    obtaining  the approval of any court, reduce such property to
 7    cash and, as soon as practicable, utilize the cash  to  cover
 8    initial  liquidation  costs,  if any, and then distribute any
 9    excess it to such depositors on a  pro  rata  basis;  but  no
10    depositor  may  receive  an  amount  in excess of his account
11    balances. For purposes of this Section, the term  "depositor"
12    does  not  include  any  other  offices  or  branches  of, or
13    wholly-owned (except  for  a  nominal  number  of  directors'
14    shares)  subsidiaries  of,  such foreign banking corporation,
15    but includes those to whom such banking office is indebted by
16    virtue of money or its equivalent received  by  such  banking
17    office  (i)  for which it has given credit or is obligated to
18    give credit to a time or demand deposit or which is evidenced
19    by a check or draft against a deposit account  and  certified
20    by  such  banking  office,  or (ii) for which it has issued a
21    letter of credit for cash or a traveler's check on which such
22    banking office is primarily liable, or (iii) for which it has
23    issued   an   outstanding   draft   (including   advice    or
24    authorization  to  charge  the  banking  office's  balance at
25    another bank), cashier's  check  or  money  order,  or  other
26    officer's check.
27        (b)  Whenever  the  Commissioner  takes possession of the
28    property and business of a foreign bank pursuant  to  Section
29    53  of  the  Illinois  Banking  Act,  the  Commissioner shall
30    conserve or  liquidate  the  property  and  business  of  the
31    foreign  bank  pursuant  to  the laws of this State as if the
32    foreign bank were an Illinois bank, with absolute  preference
33    and  priority  given  to  the  creditors  of the foreign bank
34    arising out of transactions with, and recorded on  the  books
 
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 1    of,  its  Illinois state branch or Illinois state agency over
 2    the creditors of the foreign bank's offices  located  outside
 3    this   State.    When  the  Commissioner  has  completed  the
 4    liquidation of the property and business of a  foreign  bank,
 5    the  Commissioner  shall transfer any remaining assets to the
 6    foreign bank in accordance with such orders as the court  may
 7    issue.   However,  in  case the foreign bank has an office in
 8    another state of the United States which  is  in  liquidation
 9    and  the  assets  of such office appear to be insufficient to
10    pay in full the creditors of that  office,  the  court  shall
11    order  the Commissioner to transfer to the liquidator of that
12    office such amount of any such remaining assets as appears to
13    be necessary to cover the insufficiency; if there  are  2  or
14    more  such offices and the amount of remaining assets is less
15    than the aggregate amount of insufficiencies with respect  to
16    the  offices,  the  court  shall  order  the  Commissioner to
17    distribute the remaining  assets  among  the  liquidators  of
18    those offices in such manner as the court finds equitable.
19    (Source: P.A. 84-1308.)

20        Section  50.  The  Foreign Bank Representative Office Act
21    is amended by changing Sections 4, 6, and 8 as follows:

22        (205 ILCS 650/4) (from Ch. 17, par. 2854)
23        Sec. 4.  Application; fees.
24        (a)  The  application  for  a   license   shall   contain
25    information  and  be  accompanied  by  a  reasonable  fee  as
26    determined,  by  rule,  by  the  Commissioner but in no event
27    shall such fee exceed $300 per year.
28        (b)  The Commissioner shall issue a license to a  foreign
29    bank to establish and maintain a representative office if the
30    Commissioner finds:
31        (1)  the  foreign  bank  is  of  good character and sound
32    financial standing;
 
HB2538 Engrossed            -183-              LRB9201093JScs
 1        (2)  the management of the foreign bank and the  proposed
 2    management of the representative office are adequate; and
 3        (3)  the convenience and needs of persons to be served by
 4    the proposed representative office will be promoted.
 5    (Source: P.A. 85-204.)

 6        (205 ILCS 650/6) (from Ch. 17, par. 2856)
 7        Sec.  6.  Revocation  of  license.   If  the Commissioner
 8    finds:
 9        (a)  the licensee or its representative has violated  any
10    provision  of  this  Act or other law, rule, or regulation of
11    this State; or
12        (b)  any fact  or  condition  exists  which,  if  it  had
13    existed  at  the  time  of  the original application for such
14    license, would have resulted in the Commissioner refusing  to
15    issue  such  license; then the Commissioner, may certify such
16    findings to  the  State  Banking  Board  of  Illinois.  after
17    granting   the   licensee   or  representative  a  reasonable
18    opportunity to be heard before the Board, the Board,  upon  a
19    majority vote of all its members, may revoke such license.
20    (Source: P.A. 85-204.)

21        (205 ILCS 650/8)
22        Sec.  8.  Powers  of  the Commissioner.  The Commissioner
23    shall have under this Act all of the powers  granted  to  him
24    under  the  Illinois  Banking Act, including the authority to
25    impose  a  reasonable  charge  to  recover  the  cost  of  an
26    examination conducted by  the  Commissioner,  to  the  extent
27    necessary   to  enable  the  Commissioner  to  supervise  the
28    representative office of a foreign bank holding a license.
29    (Source: P.A. 90-301, eff. 8-1-97; 90-655, eff. 7-30-98.)

30        Section 99.  Effective date.  This Act takes effect  upon
31    becoming law.

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