Full Text of HB2043 103rd General Assembly
HB2043ham001 103RD GENERAL ASSEMBLY | Rep. Jay Hoffman Filed: 3/3/2023
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| 1 | | AMENDMENT TO HOUSE BILL 2043
| 2 | | AMENDMENT NO. ______. Amend House Bill 2043 by replacing | 3 | | everything after the enacting clause with the following:
| 4 | | "Section 5. The Illinois Credit Union Act is amended by | 5 | | changing Sections 16, 20, 29, and 48 as follows:
| 6 | | (205 ILCS 305/16) (from Ch. 17, par. 4417)
| 7 | | Sec. 16. Societies and associations. Societies,
| 8 | | associations, clubs, partnerships, corporations, and limited
| 9 | | liability companies in which one or more the majority of the | 10 | | members, partners, or
shareholders
are individuals who are
| 11 | | eligible for credit union membership may be admitted to | 12 | | membership in a credit
union in the same
manner and under the | 13 | | same conditions as individuals, subject to such rules
as the | 14 | | Secretary and the Director may promulgate hereunder. Any | 15 | | members, partners, or shareholders who are ineligible for | 16 | | membership in the credit union shall not become eligible by |
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| 1 | | virtue of the eligibility of the entity in which they hold an | 2 | | ownership interest.
| 3 | | (Source: P.A. 97-133, eff. 1-1-12.)
| 4 | | (205 ILCS 305/20) (from Ch. 17, par. 4421)
| 5 | | Sec. 20. Election or appointment of officials.
| 6 | | (1) The credit union shall
be directed by a board of | 7 | | directors consisting of no less than 7 in number,
to be elected | 8 | | at the annual meeting by and from the members. Directors shall
| 9 | | hold office until the next annual meeting, unless their
terms | 10 | | are staggered. Upon amendment of its bylaws, a credit union | 11 | | may divide
the directors into 2 or 3 classes with each class as | 12 | | nearly equal in number as
possible. The term of office of the | 13 | | directors of the first class shall expire
at the first annual | 14 | | meeting after their election, that of the second class
shall
| 15 | | expire at the second annual meeting after their election, and | 16 | | that of the third
class, if any, shall expire at the third | 17 | | annual meeting after their election.
At each annual meeting | 18 | | after the classification, the number of directors equal
to the | 19 | | number of directors whose terms expire at the time of the | 20 | | meeting shall
be elected to hold office until the second | 21 | | succeeding annual meeting if there
are 2 classes or until the | 22 | | third succeeding annual meeting if there are 3
classes. A | 23 | | director shall hold office for the term for which he
or she is | 24 | | elected and until his or her
successor
is elected and | 25 | | qualified. |
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| 1 | | (1.5) Except as provided in subsection (1.10), in all | 2 | | elections for directors, every member
has the right to vote, | 3 | | in person, by proxy, or by electronic record if approved by the | 4 | | board of directors, the number of shares owned
by him, or in | 5 | | the case of a member other than a natural person, the member's
| 6 | | one vote, for as many persons as there are directors to be | 7 | | elected, or to
cumulate such shares, and give one candidate as | 8 | | many votes as the number
of directors multiplied by the number | 9 | | of his shares equals, or to distribute
them on
the same | 10 | | principle among as many candidates as he may desire and the | 11 | | directors
shall not be elected in any other manner. Shares | 12 | | held in a joint account
owned by more than one member may be | 13 | | voted by any one of the members, however,
the number of | 14 | | cumulative votes cast may not exceed a total equal to the | 15 | | number
of shares multiplied by the number of directors to be | 16 | | elected. A majority of
the shares entitled
to vote shall be | 17 | | represented either in person or by proxy for the election
of | 18 | | directors. Each director shall wholly take and subscribe to an | 19 | | oath
that he will diligently and honestly perform his duties | 20 | | in administering
the affairs of the credit union, that while | 21 | | he may delegate to another the
performance of those | 22 | | administrative duties he is not thereby relieved from
his | 23 | | responsibility for their performance, that he will not | 24 | | knowingly violate
or permit to be violated any law applicable | 25 | | to the credit union,
and that he is the owner of at least one | 26 | | share of the credit union.
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| 1 | | (1.10) Upon amendment of a credit union's bylaws, in all | 2 | | elections for directors, every member who is a natural person | 3 | | shall have the right to cast one vote, regardless of the number | 4 | | of his or her shares, in person, by proxy, or by electronic | 5 | | record if approved by the board of directors, for as many | 6 | | persons as there are directors to be elected.
| 7 | | (1.15) If the board of directors has adopted a policy | 8 | | addressing age eligibility standards on voting, holding | 9 | | office, or petitioning the board, then a credit union may | 10 | | require (i) that members be at least 18 years of age by the | 11 | | date of the meeting in order to vote at meetings of the | 12 | | members, sign nominating petitions, or sign petitions | 13 | | requesting special meetings, and (ii) that members be at least | 14 | | 18 years of age by the date of election or appointment in order | 15 | | to hold elective or appointive office. | 16 | | (2) The board of directors shall appoint from among the | 17 | | members of the
credit union, a supervisory committee of not | 18 | | less than 3 members at the
organization meeting and within 30 | 19 | | days following each annual meeting of
the members for such | 20 | | terms as the bylaws provide. Members of the supervisory | 21 | | committee may, but need not be, on the board of directors, but | 22 | | shall not
be officers of the credit union , members of the | 23 | | credit committee,
or the
credit manager if no credit committee | 24 | | has been appointed .
| 25 | | (3) The board of directors may appoint, from among the
| 26 | | members of the
credit union, a credit committee consisting of |
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| 1 | | an odd number, not less than
3 for such terms as the bylaws | 2 | | provide. Members of the credit committee
may, but need not be, | 3 | | directors or officers of the credit union , but shall
not be | 4 | | members of the supervisory committee .
| 5 | | (4) The board of directors may appoint from among the | 6 | | members
of the
credit union a membership committee of one or | 7 | | more persons. If appointed,
the committee shall act
upon all | 8 | | applications for membership and submit a report of its actions
| 9 | | to the board of directors at the next regular meeting for
| 10 | | review.
If no membership committee is appointed, credit union | 11 | | management shall act
upon all applications for membership and | 12 | | submit a report of its actions to the board of directors
at the | 13 | | next regular meeting for review.
| 14 | | (5) The board of directors may appoint, from among the | 15 | | members of the credit union, a nominating committee of 3 or | 16 | | more persons. Members of the nominating committee may, but | 17 | | need not, be directors or officers of the credit union, but may | 18 | | not be members of the supervisory committee. The appointment, | 19 | | if made, shall be made in a timely manner to permit the | 20 | | nominating committee to recruit, evaluate, and nominate | 21 | | eligible candidates for each position to be filled in the | 22 | | election of directors or, in the event of a vacancy in office, | 23 | | to be filled by appointment of the board of directors for the | 24 | | remainder of the unexpired term of the director creating the | 25 | | vacancy. Factors the nominating committee may consider in | 26 | | evaluating prospective candidates include whether a candidate |
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| 1 | | possesses or is willing to acquire through training the | 2 | | requisite skills and qualifications to carry out the statutory | 3 | | duties of a director. The board of directors may delegate to | 4 | | the nominating committee the recruitment, evaluation, and | 5 | | nomination of eligible candidates to serve on committees and | 6 | | in executive officer positions. | 7 | | (6) The board of directors may create one or more other | 8 | | committees in addition to the committees identified in this | 9 | | Section and appoint directors or such other persons as the | 10 | | board designates to serve on the committee or committees. Any | 11 | | such committee shall serve at the pleasure of the board of | 12 | | directors and it shall not act on behalf of the credit union or | 13 | | bind it to any action, but it may make recommendations to the | 14 | | board of directors. | 15 | | (7)(a) The board of directors may appoint an individual as | 16 | | a registered agent for the credit union. The name of the | 17 | | registered agent appointed by the board of directors shall be | 18 | | identified in the annual report filed by the credit union on | 19 | | the annual report form supplied by the Department. The | 20 | | business office of the registered agent shall be the same as | 21 | | the principal place of business of the credit union. Any | 22 | | process, notice, or demand required or permitted by law to be | 23 | | served upon the credit union may be served upon the registered | 24 | | agent appointed by the credit union. | 25 | | (b) A credit union that has appointed a registered | 26 | | agent shall post on its website the name of its registered |
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| 1 | | agent, the address of its principal place of business, and | 2 | | that the appointment was authorized by action of the board | 3 | | of directors. | 4 | | (c) A credit union that has appointed a registered | 5 | | agent may change its registered agent at any time by | 6 | | posting on its website a statement setting forth the | 7 | | following: | 8 | | (i) the address of its principal place of | 9 | | business, | 10 | | (ii) the name of its existing registered agent, | 11 | | (iii) the name of its successor registered agent, | 12 | | and | 13 | | (iv) that the change was authorized by action of | 14 | | the board of directors. | 15 | | (d) A registered agent may resign at any time by | 16 | | submitting written notice thereof to the credit union at | 17 | | its principal place of business. The notice shall set | 18 | | forth the following: | 19 | | (i) the name of the credit union for which the | 20 | | registered agent is acting, | 21 | | (ii) the address of the principal place of | 22 | | business of the credit union, | 23 | | (iii) the name of the registered agent, | 24 | | (iv) that the registered agent is resigning, and | 25 | | (v) the effective date of the resignation, which | 26 | | shall not be less than 30 days after the date of filing |
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| 1 | | of the notice. | 2 | | (8) (6) The use of electronic records for member voting | 3 | | pursuant to this Section shall employ a security procedure | 4 | | that meets the attribution criteria set forth in Section 9 of | 5 | | the Uniform Electronic Transactions Act. | 6 | | (9) (7) As used in this Section, "electronic", "electronic | 7 | | record", and "security procedure" have the meanings ascribed | 8 | | to those terms in the Uniform Electronic Transactions Act. the | 9 | | (Source: P.A. 102-38, eff. 6-25-21; 102-687, eff. 12-17-21; | 10 | | 102-774, eff. 5-13-22; 102-858, eff. 5-13-22; revised 8-3-22.)
| 11 | | (205 ILCS 305/29) (from Ch. 17, par. 4430)
| 12 | | Sec. 29. Meetings of directors.
| 13 | | (1) The board of directors and the executive
committee | 14 | | shall meet as often as necessary, but one body must meet at | 15 | | least
monthly and the other at least quarterly, as prescribed | 16 | | in the bylaws.
Unless a greater number is required by the | 17 | | bylaws, a majority of the whole
board of directors shall | 18 | | constitute a quorum. The act of a majority of
the directors | 19 | | present at a meeting at which a quorum is present shall be
the | 20 | | act of the board of directors unless the act of a greater | 21 | | number is
required by this Act, the credit union's articles of | 22 | | incorporation or the
bylaws. | 23 | | (1.5) Notwithstanding anything to the contrary in | 24 | | subsection (1), the board of directors of a credit union with a | 25 | | composite rating of either 1 or 2 under the Uniform Financial |
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| 1 | | Institutions Rating System known as the CAMELS supervisory | 2 | | rating system (or an equivalent rating under a comparable | 3 | | rating system) and a management rating under such composite | 4 | | rating of either 1 or 2 may meet not less than 6 times | 5 | | annually, with at least one meeting held during each fiscal | 6 | | quarter. This meeting frequency schedule shall be available to | 7 | | an eligible credit union irrespective of whether it has | 8 | | appointed an executive committee pursuant to Section 28.
| 9 | | (2) Unless specifically prohibited by the articles of | 10 | | incorporation or
bylaws, directors and committee members may | 11 | | participate in and act at any
meeting of the board or committee | 12 | | through the use of a conference telephone or
other | 13 | | communications equipment by means of which all persons | 14 | | participating in
the meeting can communicate with each other. | 15 | | Participation in the meeting
shall constitute attendance and | 16 | | presence in person at the meeting of the person
or persons so | 17 | | participating.
| 18 | | (3) Unless specifically prohibited by the articles of | 19 | | incorporation or
bylaws, any action required by this Act to be | 20 | | taken at a meeting of the board
of directors or a committee and | 21 | | any other action that may be taken at a
meeting of the board of | 22 | | directors or a committee may be taken without a
meeting if a | 23 | | consent in writing setting forth the action taken is
signed by | 24 | | all the directors entitled to vote with respect to the subject | 25 | | matter
thereof, or by all
members of the committee, as the case | 26 | | may be. The consent shall be evidenced
by one or more written |
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| 1 | | approvals, each of which sets forth the action taken and
bears | 2 | | the signatures of one or more directors or committee members. | 3 | | All the
approvals evidencing the consent shall be delivered to | 4 | | the secretary to be
filed in the corporate records of the | 5 | | credit union. The action taken shall be
effective when all the | 6 | | directors or committee members have approved the consent
| 7 | | unless the consent specifies a different effective date. A | 8 | | consent
signed by all the directors or all the members of a | 9 | | committee shall have the
same effect as a unanimous vote, and | 10 | | may be stated as such in any document
filed with the director | 11 | | under this Act. | 12 | | (4)(a) As used in this subsection: | 13 | | "Affiliate" means an organization established to serve | 14 | | the needs of credit unions, the business of which relates | 15 | | to the daily operations of credit unions. | 16 | | "Compliance review documents" means reports, meeting | 17 | | minutes, and other documents prepared in connection with a | 18 | | review or evaluation conducted by or for the board of | 19 | | directors. | 20 | | (b) This subsection applies to the board of directors | 21 | | in relation to its functions to evaluate and seek to | 22 | | improve any of the following: | 23 | | (i) loan policies or underwriting standards; | 24 | | (ii) asset quality; | 25 | | (iii) financial reporting to federal or State | 26 | | governmental or regulatory agencies; or |
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| 1 | | (iv) compliance with federal or State statutory or | 2 | | regulatory requirements, including, without | 3 | | limitation, the manner in which it performs its duties | 4 | | under Section 30. | 5 | | (c) Meetings, minutes of meetings, and reports of the | 6 | | board of directors shall be subject to the confidentiality | 7 | | and redaction standards set forth in this subsection. | 8 | | (d) Except as provided in paragraph (e), compliance | 9 | | review documents and the deliberations of the board of | 10 | | directors are confidential. An affiliate of a credit | 11 | | union, a credit union
regulatory agency, and the insurer | 12 | | of credit union share accounts shall have access to | 13 | | compliance review documents; however, (i) the documents | 14 | | remain confidential and (ii) delivery of compliance review | 15 | | documents to an affiliate or pursuant to the requirements | 16 | | of a credit union regulatory agency or an insurer of | 17 | | credit union share accounts do not constitute a waiver of | 18 | | the confidentiality granted in this Section. | 19 | | (e) This Section does not apply to any civil or | 20 | | administrative action initiated by a credit union | 21 | | regulatory agency or an insurer of credit union share | 22 | | accounts. | 23 | | (f) This Section shall not be construed to limit the | 24 | | discovery or admissibility in any civil action of any | 25 | | documents, including compliance review documents. | 26 | | (g) Any report required under this Act to be furnished |
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| 1 | | to the board of directors by the membership committee, | 2 | | credit committee, or any other committee may be submitted | 3 | | in a summary format that redacts personally identifiable | 4 | | information as defined under applicable State and federal | 5 | | law.
| 6 | | (Source: P.A. 89-603, eff. 8-2-96.)
| 7 | | (205 ILCS 305/48) (from Ch. 17, par. 4449)
| 8 | | Sec. 48. Loan limit. Within any limitations set forth in a | 9 | | policy adopted by the board of directors, a credit union may | 10 | | place a limit upon the aggregate
amount to be loaned to or | 11 | | cosigned for by any one member provided that no loan shall be | 12 | | made to any
member in an aggregate amount in excess of 10% of | 13 | | the credit union's
unimpaired capital
and surplus. Such loan | 14 | | limits shall not be subject to reduction by rules adopted by | 15 | | the Secretary.
| 16 | | (Source: P.A. 100-361, eff. 8-25-17.)
| 17 | | Section 99. Effective date. This Act takes effect upon | 18 | | becoming law.".
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