TITLE 38: FINANCIAL INSTITUTIONS
CHAPTER II: OFFICE OF BANKS AND REAL ESTATE
PART 354 ADMINISTRATION OF ASSETS OBTAINED IN COLLECTION OF A DEBT

Section 354.10 Purpose

Section 354.20 General Rule


AUTHORITY: Implementing Sections 3 and 5(12)(a) and authorized by Section 48(6) of the Illinois Banking Act [205 ILCS 5/3, 5(12)(a) and 48(6)].


SOURCE: Adopted at 16 Ill. Reg. 12420, effective July 24, 1992; recodified from Chapter II, Commissioner of Banks and Trust Companies, to Chapter II, Office of Banks and Real Estate, pursuant to PA 89-508, at 20 Ill. Reg. 12645.

 

Section 354.10  Purpose

 

Section 3 of the Illinois Banking Act (the Act) authorizes a state bank to loan money on personal or real estate security  [205 ILCS 5/3].  Section 5(12) of the Act further authorizes a state bank to establish a subsidiary to hold title to and administer assets acquired as a result of the collection of loans.  Included in these express powers is the incidental right to maintain assets that a state bank acquires in collection of a debt in preparation for their disposal.

 

Section 354.20  General Rule

 

a)         A state bank and its subsidiaries may take actions that are necessary to administer assets obtained in the collection of a debt, provided such actions are in conjunction with ongoing efforts to dispose of the assets by sale or liquidation.

 

b)         A state bank and its subsidiaries shall adopt a written policy for the disposition of assets obtained in the collection of a debt.

 

c)         A state bank and its subsidiaries shall document in each loan file any deviation from the written policy for the disposition of assets obtained in the collection of a debt.

 

d)         When making a request for an extension of the period for which assets may be retained, whether pursuant to Section 5(9) of the Act or otherwise, a state bank or its subsidiary shall furnish the following information to the Commissioner:

 

1)         the good faith actions the bank has taken to dispose of the assets;

 

2)         why further retention of the assets is in the best interests of the bank;

 

3)         the bank's estimate of time frame for ultimate disposition of the assets;

 

4)         the cost for administering the assets during the interim; and

 

5)         such other pertinent information as the Commissioner may request.