Full Text of SB3787 102nd General Assembly
SB3787enr 102ND GENERAL ASSEMBLY |
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| 1 | | AN ACT concerning regulation.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Illinois Credit Union Act is amended by | 5 | | changing Sections 8, 9, 20 and 59 as follows:
| 6 | | (205 ILCS 305/8) (from Ch. 17, par. 4409)
| 7 | | Sec. 8. Secretary's powers and duties. Credit unions are | 8 | | regulated by the
Department. The Secretary in executing the | 9 | | powers and discharging the duties
vested by law in the | 10 | | Department has the following powers and duties:
| 11 | | (1) To exercise the rights, powers and duties set | 12 | | forth in this Act or
any related Act. The Director shall | 13 | | oversee the functions of the Division and report to the | 14 | | Secretary, with respect to the Director's exercise of any | 15 | | of the rights, powers, and duties vested by law in the | 16 | | Secretary under this Act. All references in this Act to | 17 | | the Secretary shall be deemed to include the Director, as | 18 | | a person authorized by the Secretary or this Act to assume | 19 | | responsibility for the oversight of the functions of the | 20 | | Department relating to the regulatory supervision of | 21 | | credit unions under this Act.
| 22 | | (2) To prescribe rules and regulations for the | 23 | | administration of this
Act. The provisions of the Illinois |
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| 1 | | Administrative Procedure Act are hereby
expressly adopted | 2 | | and incorporated herein
as though a part of this Act, and | 3 | | shall apply to all administrative rules
and procedures of | 4 | | the Department under this Act.
| 5 | | (3) To direct and supervise all the administrative and | 6 | | technical
activities
of the Department including the | 7 | | employment of a Credit Union Supervisor
who shall have | 8 | | knowledge in the theory and practice of, or experience in, | 9 | | the
operations or supervision of financial institutions, | 10 | | preferably credit unions,
and such other persons as are | 11 | | necessary to carry out his functions. The Secretary shall | 12 | | ensure that all examiners appointed or assigned to examine | 13 | | the affairs of State-chartered credit unions possess the | 14 | | necessary training and continuing education to effectively | 15 | | execute their jobs.
| 16 | | (4) To issue cease and desist orders when in the | 17 | | opinion of the Secretary,
a credit union is engaged or has | 18 | | engaged, or the Secretary has reasonable
cause to believe | 19 | | the credit union is about to engage, in an unsafe or | 20 | | unsound
practice, or is violating or has violated or the | 21 | | Secretary has reasonable
cause to believe is about to | 22 | | violate a law, rule or regulation or any condition
imposed | 23 | | in writing by the Department.
| 24 | | (5) To suspend from office and to prohibit from | 25 | | further participation
in any manner in the conduct of the | 26 | | affairs of any his credit union any director,
officer or |
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| 1 | | committee member who has committed any violation of a law, | 2 | | rule,
regulation or of a cease and desist order or who has | 3 | | engaged or participated
in any unsafe or unsound practice | 4 | | in connection with the credit union or
who has committed | 5 | | or engaged in any act, omission, or practice which
| 6 | | constitutes a breach of his fiduciary duty as such | 7 | | director, officer or
committee member, when the Secretary | 8 | | has determined that such action or actions
have resulted | 9 | | or will result in substantial financial loss or other | 10 | | damage that
seriously prejudices the interests of the | 11 | | members.
| 12 | | (6) To assess a civil penalty against a credit union | 13 | | provided that: | 14 | | (A) the Secretary reasonably determines, based on | 15 | | objective facts and an accurate assessment of | 16 | | applicable legal standards, that the credit union has: | 17 | | (i) committed a violation of this Act, any | 18 | | rule adopted in accordance with this Act, or any | 19 | | order of the Secretary issued pursuant to his or | 20 | | her authority under this Act; or | 21 | | (ii) engaged or participated in any unsafe or | 22 | | unsound practice; | 23 | | (B) before a civil penalty is assessed under this | 24 | | item (6), the Secretary must make the further | 25 | | reasonable determination, based on objective facts and | 26 | | an accurate assessment of applicable legal standards, |
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| 1 | | that the credit union's action constituting a | 2 | | violation under subparagraph (i) of paragraph (A) of | 3 | | item (6) or an unsafe and unsound practice under | 4 | | subparagraph (ii) of paragraph (A) of item (6): | 5 | | (i) directly resulted in a substantial and | 6 | | material financial loss or created a reasonable | 7 | | probability that a substantial and material | 8 | | financial loss will directly result; or | 9 | | (ii) constituted willful misconduct or a | 10 | | material breach of fiduciary duty of any director, | 11 | | officer, or committee member of the credit union; | 12 | | Material financial loss, as referenced in this | 13 | | paragraph (B), shall be assessed in light of | 14 | | surrounding circumstances and the relative size and | 15 | | nature of the financial loss or probable financial | 16 | | loss. Certain benchmarks shall be used in determining | 17 | | whether financial loss is material, such as a | 18 | | percentage of total assets or total gross income for | 19 | | the immediately preceding 12-month period. Absent | 20 | | compelling and extraordinary circumstances, no civil | 21 | | penalty shall be assessed, unless the financial loss | 22 | | or probable financial loss is equal to or greater than | 23 | | either 1% of the credit union's total assets for the | 24 | | immediately preceding 12-month period, or 1% of the | 25 | | credit union's total gross income for the immediately | 26 | | preceding 12-month period, whichever is less; |
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| 1 | | (C) before a civil penalty is assessed under this | 2 | | item (6), the credit union must be expressly advised | 3 | | in writing of the: | 4 | | (i) specific violation that could subject it | 5 | | to a penalty under this item (6); and | 6 | | (ii) specific remedial action to be taken | 7 | | within a specific and reasonable time frame to | 8 | | avoid imposition of the penalty; | 9 | | (D) Civil penalties assessed under this item (6) | 10 | | shall be remedial, not punitive, and reasonably | 11 | | tailored to ensure future compliance by the credit | 12 | | union with the provisions of this Act and any rules | 13 | | adopted pursuant to this Act; | 14 | | (E) a credit union's failure to take timely | 15 | | remedial action with respect to the specific violation | 16 | | may result in the issuance of an order assessing a | 17 | | civil penalty up to the following maximum amount, | 18 | | based upon the total assets of the credit union: | 19 | | (i) Credit unions with assets of less than $10 | 20 | | million ................................................$1,000 | 21 | | (ii) Credit unions with assets of at least $10 | 22 | | million and less than $50 million ......................$2,500 | 23 | | (iii) Credit unions with assets of at least | 24 | | $50 million and less than $100 million .................$5,000 | 25 | | (iv) Credit unions with assets of at least | 26 | | $100 million and less than $500 million ...............$10,000 |
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| 1 | | (v) Credit unions with assets of at least $500 | 2 | | million and less than $1 billion ......................$25,000 | 3 | | (vi) Credit unions with assets of $1 billion | 4 | | and greater .....................................$50,000; and | 5 | | (F) an order assessing a civil penalty under this | 6 | | item (6) shall take effect upon service of the order, | 7 | | unless the credit union makes a written request for a | 8 | | hearing under 38 IL. Adm. Code 190.20 of the | 9 | | Department's rules for credit unions within 90 days | 10 | | after issuance of the order; in that event, the order | 11 | | shall be stayed until a final administrative order is | 12 | | entered. | 13 | | This item (6) shall not apply to violations separately | 14 | | addressed in rules as authorized under item (7) of this | 15 | | Section. | 16 | | (7) Except for the fees established in this Act, to | 17 | | prescribe, by rule
and regulation, fees and penalties for | 18 | | preparing, approving, and filing
reports and other | 19 | | documents; furnishing
transcripts; holding hearings; | 20 | | investigating applications
for permission to
organize, | 21 | | merge, or convert; failure to maintain accurate books and | 22 | | records
to enable the Department to conduct an | 23 | | examination; and taking supervisory
actions.
| 24 | | (8) To destroy, in his discretion, any or all books | 25 | | and records of any
credit union in his possession or under | 26 | | his control after the expiration
of three years from the |
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| 1 | | date of cancellation of the charter of such credit
unions.
| 2 | | (9) To make investigations and to conduct research and | 3 | | studies and to
publish some of the problems of persons in | 4 | | obtaining credit at reasonable
rates of interest and of | 5 | | the methods and benefits of cooperative saving
and lending | 6 | | for such persons.
| 7 | | (10) To authorize, foster or establish experimental, | 8 | | developmental,
demonstration or pilot projects by public | 9 | | or private organizations including
credit unions which:
| 10 | | (a) promote more effective operation of credit | 11 | | unions so as to provide
members an opportunity to use | 12 | | and control their own money to improve their
economic | 13 | | and social conditions; or
| 14 | | (b) are in the best interests of credit unions, | 15 | | their members and the
people of the State of Illinois.
| 16 | | (11) To cooperate in studies, training or other | 17 | | administrative activities
with, but not limited to, the | 18 | | NCUA, other state credit union regulatory
agencies and | 19 | | industry trade associations in order to promote more | 20 | | effective
and efficient supervision of Illinois chartered | 21 | | credit unions.
| 22 | | (12) Notwithstanding the provisions of this Section, | 23 | | the Secretary shall not: | 24 | | (1) issue an order against a credit union | 25 | | organized under this Act for unsafe or unsound banking | 26 | | practices solely because the entity provides or has |
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| 1 | | provided financial services to a cannabis-related | 2 | | legitimate business; | 3 | | (2) prohibit, penalize, or otherwise discourage a | 4 | | credit union from providing financial services to a | 5 | | cannabis-related legitimate business solely because | 6 | | the entity provides or has provided financial services | 7 | | to a cannabis-related legitimate business; | 8 | | (3) recommend, incentivize, or encourage a credit | 9 | | union not to offer financial services to an account | 10 | | holder or to downgrade or cancel the financial | 11 | | services offered to an account holder solely because: | 12 | | (A) the account holder is a manufacturer or | 13 | | producer, or is the owner, operator, or employee | 14 | | of a cannabis-related legitimate business; | 15 | | (B) the account holder later becomes an owner | 16 | | or operator of a cannabis-related legitimate | 17 | | business; or | 18 | | (C) the credit union was not aware that the | 19 | | account holder is the owner or operator of a | 20 | | cannabis-related legitimate business; and | 21 | | (4) take any adverse or corrective supervisory | 22 | | action on a loan made to an owner or operator of: | 23 | | (A) a cannabis-related legitimate business | 24 | | solely because the owner or operator owns or | 25 | | operates a cannabis-related legitimate business; | 26 | | or |
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| 1 | | (B) real estate or equipment that is leased to | 2 | | a cannabis-related legitimate business solely | 3 | | because the owner or operator of the real estate | 4 | | or equipment leased the equipment or real estate | 5 | | to a cannabis-related legitimate business. | 6 | | (Source: P.A. 101-27, eff. 6-25-19.)
| 7 | | (205 ILCS 305/9) (from Ch. 17, par. 4410)
| 8 | | Sec. 9. Reports and examinations.
| 9 | | (1) Credit unions shall report to
the Department on forms | 10 | | supplied by the Department, in accordance with a
schedule | 11 | | published by the Department. A recapitulation of the annual | 12 | | reports
shall be compiled and published annually by the | 13 | | Department, for the use
of the General Assembly, credit | 14 | | unions, various educational institutions
and other interested | 15 | | parties. A credit union which fails to file any report
when due | 16 | | shall pay to the Department a late filing fee for each
day the | 17 | | report is overdue as prescribed by rule. The Secretary may | 18 | | extend
the time for filing a
report.
| 19 | | (2) The Secretary may require special examinations of and | 20 | | special
financial reports from a credit union or a credit
| 21 | | union organization in which a credit union loans, invests, or | 22 | | delegates
substantially all
managerial duties and | 23 | | responsibilities when he determines that such
examinations
and | 24 | | reports are necessary to enable the Department
to determine | 25 | | the safety of a credit union's operation or its solvency.
The |
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| 1 | | cost to the Department of the aforesaid special examinations | 2 | | shall be
borne by the credit union being examined as | 3 | | prescribed by rule.
| 4 | | (3) All credit unions incorporated under this Act shall be | 5 | | examined at
least biennially by the Department or, at the | 6 | | discretion of
the Secretary,
by a public accountant registered | 7 | | by the Department of Financial and Professional
Regulation. | 8 | | The costs of an examination shall be paid by the
credit union. | 9 | | The scope of all examinations by a public accountant shall
be | 10 | | at least equal to the examinations made by the Department. The | 11 | | examiners
shall have full access to, and may compel the | 12 | | production of, all the books,
papers, securities and accounts | 13 | | of any credit union. A special examination
shall be made by the | 14 | | Department or by a public accountant approved by the
| 15 | | Department upon written request of 5 or more members, who | 16 | | guarantee the
expense of the same. Any credit union refusing | 17 | | to submit to an examination
when ordered by the Department | 18 | | shall be reported to the Attorney General,
who shall institute | 19 | | proceedings to have its charter revoked. If the Secretary
| 20 | | determines that the examination of a credit
union is to be
| 21 | | conducted by a public accountant registered by the Department | 22 | | of Financial and
Professional Regulation and the examination | 23 | | is
done in conjunction
with the credit union's external | 24 | | independent audit of financial
statements, the requirements of | 25 | | this Section and subsection (3) of Section
34 shall be deemed | 26 | | met.
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| 1 | | (3.5) Pursuant to Section 8, the Secretary shall adopt | 2 | | rules that ensure consistency and due process in the | 3 | | examination process. The Secretary may also establish | 4 | | guidelines that (i) define the scope of the examination | 5 | | process and (ii) clarify examination items to be resolved. The | 6 | | rules, formal guidance, interpretive letters, or opinions | 7 | | furnished to credit unions by the Secretary may be relied upon | 8 | | by the credit unions. | 9 | | (4) A copy of the completed report of examination and a | 10 | | review comment
letter, if any, citing exceptions revealed | 11 | | during the examination, shall
be submitted to the credit union | 12 | | by the Department. A detailed report stating
the corrective | 13 | | actions taken by the board of directors on each exception
set | 14 | | forth in the review comment letter shall be filed with the | 15 | | Department
within 40 days after the date of the review comment | 16 | | letter, or as otherwise
directed by the Department. Any credit | 17 | | union through its officers, directors,
committee members or | 18 | | employees, which willfully provides fraudulent or
misleading | 19 | | information regarding the corrective actions taken on | 20 | | exceptions
appearing in a review comment letter may have its | 21 | | operations restricted to
the collection of principal and | 22 | | interest on loans outstanding and the
payment of normal | 23 | | expenses and salaries until all exceptions are corrected
and | 24 | | accepted by the Department.
| 25 | | (5) The Secretary may accept an examination from the | 26 | | National Credit Union Administration or a private insurer of |
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| 1 | | share deposits approved by the Secretary instead of an | 2 | | examination conducted by the Department or by a public | 3 | | accountant registered by the Department pursuant to subsection | 4 | | (3). Acceptance of an examination from the National Credit | 5 | | Union Administration or an approved private insurer of share | 6 | | deposits shall only be permitted on an alternating basis with | 7 | | examinations that the Department or a registered public | 8 | | accountant conducts. | 9 | | (Source: P.A. 102-558, eff. 8-20-21.)
| 10 | | (205 ILCS 305/20) (from Ch. 17, par. 4421)
| 11 | | Sec. 20. Election or appointment of officials.
| 12 | | (1) The credit union shall
be directed by a board of | 13 | | directors consisting of no less than 7 in number,
to be elected | 14 | | at the annual meeting by and from the members. Directors shall
| 15 | | hold office until the next annual meeting, unless their
terms | 16 | | are staggered. Upon amendment of its bylaws, a credit union | 17 | | may divide
the directors into 2 or 3 classes with each class as | 18 | | nearly equal in number as
possible. The term of office of the | 19 | | directors of the first class shall expire
at the first annual | 20 | | meeting after their election, that of the second class
shall
| 21 | | expire at the second annual meeting after their election, and | 22 | | that of the third
class, if any, shall expire at the third | 23 | | annual meeting after their election.
At each annual meeting | 24 | | after the classification, the number of directors equal
to the | 25 | | number of directors whose terms expire at the time of the |
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| 1 | | meeting shall
be elected to hold office until the second | 2 | | succeeding annual meeting if there
are 2 classes or until the | 3 | | third succeeding annual meeting if there are 3
classes. A | 4 | | director shall hold office for the term for which he
or she is | 5 | | elected and until his or her
successor
is elected and | 6 | | qualified. | 7 | | (1.5) Except as provided in subsection (1.10), in all | 8 | | elections for directors, every member
has the right to vote, | 9 | | in person, by proxy, or by secure electronic record if | 10 | | approved by the board of directors, the number of shares owned
| 11 | | by him, or in the case of a member other than a natural person, | 12 | | the member's
one vote, for as many persons as there are | 13 | | directors to be elected, or to
cumulate such shares, and give | 14 | | one candidate as many votes as the number
of directors | 15 | | multiplied by the number of his shares equals, or to | 16 | | distribute
them on
the same principle among as many candidates | 17 | | as he may desire and the directors
shall not be elected in any | 18 | | other manner. Shares held in a joint account
owned by more than | 19 | | one member may be voted by any one of the members, however,
the | 20 | | number of cumulative votes cast may not exceed a total equal to | 21 | | the number
of shares multiplied by the number of directors to | 22 | | be elected. A majority of
the shares entitled
to vote shall be | 23 | | represented either in person or by proxy for the election
of | 24 | | directors. Each director shall wholly take and subscribe to an | 25 | | oath
that he will diligently and honestly perform his duties | 26 | | in administering
the affairs of the credit union, that while |
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| 1 | | he may delegate to another the
performance of those | 2 | | administrative duties he is not thereby relieved from
his | 3 | | responsibility for their performance, that he will not | 4 | | knowingly violate
or permit to be violated any law applicable | 5 | | to the credit union,
and that he is the owner of at least one | 6 | | share of the credit union.
| 7 | | (1.10) Upon amendment of a credit union's bylaws approved | 8 | | by the members , in all elections for directors, every member | 9 | | who is a natural person shall have the right to cast one vote, | 10 | | regardless of the number of his or her shares, in person, by | 11 | | proxy, or by secure electronic record if approved by the board | 12 | | of directors, for as many persons as there are directors to be | 13 | | elected.
| 14 | | (1.15) If the board of directors has adopted a policy | 15 | | addressing age eligibility standards on voting, holding | 16 | | office, or petitioning the board, then a credit union may | 17 | | require (i) that members be at least 18 years of age by the | 18 | | date of the meeting in order to vote at meetings of the | 19 | | members, sign nominating petitions, or sign petitions | 20 | | requesting special meetings, and (ii) that members be at least | 21 | | 18 years of age by the date of election or appointment in order | 22 | | to hold elective or appointive office. | 23 | | (2) The board of directors shall appoint from among the | 24 | | members of the
credit union, a supervisory committee of not | 25 | | less than 3 members at the
organization meeting and within 30 | 26 | | days following each annual meeting of
the members for such |
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| 1 | | terms as the bylaws provide. Members of the supervisory | 2 | | committee may, but need not be, on the board of directors, but | 3 | | shall not
be officers of the credit union, members of the | 4 | | credit committee,
or the
credit manager if no credit committee | 5 | | has been appointed.
| 6 | | (3) The board of directors may appoint, from among the
| 7 | | members of the
credit union, a credit committee consisting of | 8 | | an odd number, not less than
3 for such terms as the bylaws | 9 | | provide. Members of the credit committee
may, but need not be, | 10 | | directors or officers of the credit union, but shall
not be | 11 | | members of the supervisory committee.
| 12 | | (4) The board of directors may appoint from among the | 13 | | members
of the
credit union a membership committee of one or | 14 | | more persons. If appointed,
the committee shall act
upon all | 15 | | applications for membership and submit a report of its actions
| 16 | | to the board of directors at the next regular meeting for
| 17 | | review.
If no membership committee is appointed, credit union | 18 | | management shall act
upon all applications for membership and | 19 | | submit a report of its actions to the board of directors
at the | 20 | | next regular meeting for review.
| 21 | | (5) As used in this Section, "electronic" and "electronic | 22 | | record" have the meanings ascribed to those terms in the | 23 | | Uniform Electronic Transactions Act. As used in this Section, | 24 | | "secured electronic record" means an electronic record that | 25 | | meets the criteria set forth in the Uniform Electronic | 26 | | Transactions Act. |
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| 1 | | (Source: P.A. 102-38, eff. 6-25-21; revised 8-3-21.)
| 2 | | (205 ILCS 305/59) (from Ch. 17, par. 4460)
| 3 | | Sec. 59. Investment of funds.
| 4 | | (a) Funds not used in loans to members may be
invested, | 5 | | pursuant to subsection (7) of Section 30 of this Act, and
| 6 | | subject to Departmental rules and
regulations:
| 7 | | (1) In securities, obligations or other instruments of | 8 | | or issued by or
fully guaranteed as to principal and | 9 | | interest by the United States of America
or any agency | 10 | | thereof or in any trust or trusts established for | 11 | | investing
directly or collectively in the same;
| 12 | | (2) In obligations of any state of the United States, | 13 | | the District of
Columbia, the Commonwealth of Puerto Rico, | 14 | | and the several
territories organized
by Congress, or any | 15 | | political subdivision thereof; however, a credit union
may
| 16 | | not invest more than 10% of its unimpaired capital and | 17 | | surplus in the
obligations of one issuer, exclusive of | 18 | | general obligations of the issuer, and
investments in | 19 | | municipal securities must be limited to securities rated | 20 | | in one
of the 4
highest rating investment grades | 21 | | categories by a nationally recognized statistical rating
| 22 | | organization;
| 23 | | (3) In certificates of deposit or passbook type | 24 | | accounts issued by a state
or national bank, mutual | 25 | | savings bank or savings and loan association; provided
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| 1 | | that such institutions have their accounts insured by the | 2 | | Federal Deposit
Insurance Corporation or the Federal | 3 | | Savings and Loan Insurance Corporation;
but provided, | 4 | | further, that a credit union's investment in an account in
| 5 | | any one institution may exceed the insured limit on | 6 | | accounts;
| 7 | | (4) In shares, classes of shares or share certificates | 8 | | of other credit
unions, including, but not limited to | 9 | | corporate credit unions; provided
that such credit unions | 10 | | have their members' accounts insured by the NCUA
or other | 11 | | approved insurers, and that if the members' accounts are | 12 | | so insured,
a credit union's investment may exceed the | 13 | | insured limit on accounts;
| 14 | | (5) In shares of a cooperative society organized under | 15 | | the laws of this
State or the laws of the United States in | 16 | | the total amount not exceeding
10% of the unimpaired | 17 | | capital and surplus of the credit union; provided
that | 18 | | such investment shall first be approved by the Department;
| 19 | | (6) In obligations of the State of Israel, or | 20 | | obligations fully guaranteed
by the State of Israel as to | 21 | | payment of principal and interest;
| 22 | | (7) In shares, stocks or obligations of other | 23 | | financial institutions in
the total amount not exceeding | 24 | | 5% of the unimpaired capital and surplus
of the credit | 25 | | union;
| 26 | | (8) In federal funds and bankers' acceptances;
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| 1 | | (9) In shares or stocks of Credit Union Service | 2 | | Organizations in the
total amount not exceeding the | 3 | | greater of 6% of the unimpaired
capital and surplus of the
| 4 | | credit union or the amount authorized for federal credit | 5 | | unions;
| 6 | | (10) In corporate bonds identified as investment grade | 7 | | by at least one nationally recognized statistical rating | 8 | | organization, provided that: | 9 | | (i) the board of directors has established a | 10 | | written policy that addresses corporate bond | 11 | | investment procedures and how the credit union will | 12 | | manage credit risk, interest rate risk, liquidity | 13 | | risk, and concentration risk; and | 14 | | (ii) the credit union has documented in its | 15 | | records that a credit analysis of a particular | 16 | | investment and the issuing entity was conducted by the | 17 | | credit union, a third party on behalf of the credit | 18 | | union qualified by education or experience to assess | 19 | | the risk characteristics of corporate bonds, or a | 20 | | nationally recognized statistical rating agency before | 21 | | purchasing the investment and the analysis is updated | 22 | | at least annually for as long as it holds the | 23 | | investment; | 24 | | (11) To aid in the credit union's management of its | 25 | | assets, liabilities, and liquidity in the purchase of an | 26 | | investment interest in a pool of loans, in whole or in part |
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| 1 | | and without regard to the membership of the borrowers, | 2 | | from other depository institutions and financial type | 3 | | institutions, including mortgage banks, finance companies, | 4 | | insurance companies, and other loan sellers, subject to | 5 | | such safety and soundness standards, limitations, and | 6 | | qualifications as the Department may establish by rule or | 7 | | guidance from time to time; | 8 | | (12) To aid in the credit union's management of its | 9 | | assets, liabilities, and liquidity by receiving funds from | 10 | | another financial institution as evidenced by certificates | 11 | | of deposit, share certificates, or other classes of shares | 12 | | issued by the credit union to the financial institution; | 13 | | (13) In the purchase and assumption of assets held by | 14 | | other financial institutions, with approval of the | 15 | | Secretary and subject to any safety and soundness | 16 | | standards, limitations, and qualifications as the | 17 | | Department may establish by rule or guidance from time to | 18 | | time; and | 19 | | (14) In the shares, stocks, or obligations of | 20 | | community development financial institutions as defined in | 21 | | regulations issued by the U.S. Department of the Treasury | 22 | | and minority depository institutions as defined by the | 23 | | National Credit Union Administration; however the | 24 | | aggregate amount of all such investments shall not at any | 25 | | time exceed 5% of the paid-in and unimpaired capital and | 26 | | surplus of the credit union. |
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| 1 | | (b) As used in this Section: | 2 | | "Political subdivision" includes, but is not
limited to, | 3 | | counties,
townships, cities, villages, incorporated towns, | 4 | | school districts, educational
service regions, special road | 5 | | districts, public water supply districts, fire
protection | 6 | | districts, drainage districts, levee districts, sewer | 7 | | districts,
housing authorities, park districts, and any
| 8 | | agency, corporation, or instrumentality of a state or its | 9 | | political
subdivisions, whether now or hereafter created and | 10 | | whether herein specifically
mentioned or not.
| 11 | | "Financial institution" includes any bank, savings bank, | 12 | | savings and loan association, or credit union established | 13 | | under the laws of the United States, this State, or any other | 14 | | state. | 15 | | (c) A credit union investing to fund an employee benefit | 16 | | plan obligation is not subject to the investment limitations | 17 | | of this Act and this Section and may purchase an investment | 18 | | that would otherwise be impermissible if the investment is | 19 | | directly related to the credit union's obligation under the | 20 | | employee benefit plan and the credit union holds the | 21 | | investment only for so long as it has an actual or potential | 22 | | obligation under the employee benefit plan.
| 23 | | (d) If a credit union acquires loans from another | 24 | | financial institution or financial-type institution pursuant | 25 | | to this Section, the credit union shall be authorized to | 26 | | provide loan servicing and collection services in connection |
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| 1 | | with those loans. | 2 | | (Source: P.A. 101-567, eff. 8-23-19; 102-496, eff. 8-20-21.)
| 3 | | Section 99. Effective date. This Act takes effect upon | 4 | | becoming law.
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