Public Act 93-0620
SB771 Enrolled LRB093 03108 JLS 03125 b
AN ACT in relation to banking.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Banking Act is amended by
changing Section 34 as follows:
(205 ILCS 5/34) (from Ch. 17, par. 342)
Sec. 34. Exceptions to loans and investment limits. The
limitations in Sections 32, 33, and 35.1 of this Act upon the
liabilities of any one person and upon the purchase and
holding of marketable investment securities shall not apply:
(1) To the extent of 50% of the unimpaired capital and
unimpaired surplus of any bank, to loans to or obligations of
any person to the extent that the loan shall be secured by a
like amount of obligations of or guaranteed by the United
States or by the State of Illinois, or by a like amount of
obligations of any corporation wholly owned directly or
indirectly by the United States or of any agency or
instrumentality of the United States or of the State of
Illinois, including any unit of local government or school
district, provided that the total liabilities to any bank of
any one person shall not exceed 50% of such unimpaired
capital and unimpaired surplus.
(2) To the extent of 30% of the unimpaired capital and
unimpaired surplus of any bank, to loans to or obligations of
any person to the extent that the same shall be secured by
shipping documents or instruments transferring or securing
title covering livestock or giving a lien on livestock when
the market value of the livestock securing the obligation is
not at the time of the making of the loan less than 115% of
the principal amount of the obligation, provided that the
total liabilities to any bank of any one person shall not
exceed 50% of the unimpaired capital and unimpaired surplus.
(3) To the extent of the unimpaired capital and
unimpaired surplus of any bank, to the purchase of or holding
by any bank of the general obligations of each municipality
located in the State of Illinois or in any other state of the
United States or to the purchase of or holding of the tax
anticipation warrants of each such municipality.
(4) To the obligations as endorser, whether with or
without recourse, or as guarantor, whether conditional or
unconditional, of negotiable or nonnegotiable installment
consumer paper of the person transferring the same if the
bank's files or the knowledge of its officers of the
financial condition of each maker of those obligations is
reasonably adequate and if an officer of the bank, designated
for that purpose by the board of directors of the bank,
certifies that the responsibility of each maker of the
obligations has been evaluated and that the bank is relying
primarily upon each maker for the payment of the obligations;
certification shall be in writing and shall be retained as
part of the records of the bank.
(5) To the issuance, advice, or confirmation of letters
of credit; however, if the letter of credit is a standby
letter of credit, it shall be included within the limit under
Section 32 for the person who has procured the issuance of
the standby letter of credit unless the issuing bank has, at
the time of issuance, an irrevocable commitment by another
bank to purchase or participate out any amounts that may
later be drawn under the letter of credit that would create a
loan in excess of the limits under Section 32 for the person
or the amounts are secured by pledge of United States
government securities, a segregated deposit account, or
other security that would exempt a loan so secured by
application of Section 34 or 35 of this Act; if, however, a
commitment to purchase or participate is in place, the
amounts are not included in the limits under Section 32 for
the person until drafts are presented upon the letter.
(6) To the acceptance of drafts or bills of exchange
that grow out of transactions involving the importation or
exportation of goods; or that grow out of transactions
involving the domestic shipment of goods, provided documents
of title covering the goods secure the acceptances at the
time of acceptance; or that are secured at the time of
acceptances by documents of title covering readily marketable
staples; but the aggregate amount of these acceptances by any
State bank on behalf of any one person at any one time
outstanding shall not exceed 20% of the unimpaired capital
and unimpaired surplus of the bank unless the part thereof in
excess of that percentum of unimpaired capital and unimpaired
surplus is and will remain secured by accompanying documents
of title or proceeds thereof growing out of the same
transaction or by substituted security of similar character;
provided further, however, that the aggregate amount of the
acceptances on behalf of any one person outstanding at any
one time shall not exceed 50% of the amount of unimpaired
capital and unimpaired surplus of the bank. The provisions of
this paragraph (6) apply to the acceptances by a State bank
on behalf of any one person and not to the purchase by a
State bank of other banks' acceptances. A State bank may
purchase acceptances from other banks in amounts not to
exceed 50% of the State bank's unimpaired capital and
unimpaired surplus from any one bank.
(7) To the extent of 20% of the unimpaired capital and
unimpaired surplus of any bank, to the purchase of or holding
by any bank of obligations of the State of Israel or
obligations fully guaranteed by the State of Israel as to
payment of principal and interest.
(8) To the purchase of stock in a Federal Home Loan
Bank.
(Source: P.A. 90-301, eff. 8-1-97.)
Section 99. Effective date. This Act takes effect upon
becoming law.