Full Text of HB3968 102nd General Assembly
HB3968eng 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 Banking Act is amended by changing | 5 | | Sections 2 and 30 as follows:
| 6 | | (205 ILCS 5/2) (from Ch. 17, par. 302)
| 7 | | Sec. 2. General definitions. In this Act, unless the | 8 | | context otherwise
requires, the following words and phrases | 9 | | shall have the following meanings:
| 10 | | "Accommodation party" shall have the meaning ascribed to | 11 | | that term in
Section 3-419 of the Uniform Commercial Code.
| 12 | | "Action" in the sense of a judicial proceeding includes | 13 | | recoupments,
counterclaims, set-off, and any other proceeding | 14 | | in which
rights are determined.
| 15 | | "Affiliate facility" of a bank means a main banking | 16 | | premises or branch
of another commonly owned bank.
The main | 17 | | banking premises or any branch of a bank
may be an "affiliate | 18 | | facility" with respect to one or more other commonly owned
| 19 | | banks.
| 20 | | "Appropriate federal banking agency" means the Federal | 21 | | Deposit Insurance
Corporation, the Federal Reserve Bank of | 22 | | Chicago, or the Federal Reserve Bank
of St. Louis, as | 23 | | determined by federal law.
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| 1 | | "Bank" means any person doing a banking business whether | 2 | | subject to the
laws of this or any other jurisdiction.
| 3 | | A "banking house", "branch", "branch bank" or "branch
| 4 | | office" shall mean any place of business of a bank at which | 5 | | deposits are
received, checks paid, or loans made, but shall | 6 | | not include any place at
which only records thereof are made, | 7 | | posted, or kept. A place of business
at which deposits are | 8 | | received, checks paid, or loans made shall not be
deemed to be | 9 | | a branch, branch bank, or branch office if the place of
| 10 | | business is adjacent to and connected with the main banking | 11 | | premises, or if
it is separated from the main banking premises | 12 | | by not more than an alley;
provided always that (i) if the | 13 | | place of business is separated by an alley
from the main | 14 | | banking premises there is a connection between the two by
| 15 | | public or private way or by subterranean or overhead passage, | 16 | | and (ii) if
the place of business is in a building not wholly | 17 | | occupied by the bank, the
place of business shall not be within | 18 | | any office or room in which any other
business or service of | 19 | | any kind or nature other than the business of the
bank is | 20 | | conducted or carried on. A place of business at which deposits | 21 | | are
received, checks paid, or loans made shall not be deemed to | 22 | | be a branch,
branch bank, or branch office (i) of any bank if | 23 | | the place is a terminal established and maintained in | 24 | | accordance with
paragraph
(17) of Section 5 of this Act, or | 25 | | (ii) of a commonly owned bank
by virtue of
transactions | 26 | | conducted at that place on behalf of the other commonly owned |
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| 1 | | bank
under paragraph (23) of Section 5 of this Act if the place | 2 | | is an affiliate
facility with respect to the other bank.
| 3 | | "Branch of an out-of-state bank" means a branch | 4 | | established or maintained in
Illinois by an out-of-state bank | 5 | | as a result of a merger between an Illinois
bank and the | 6 | | out-of-state bank that occurs on or after May 31, 1997, or any
| 7 | | branch established by the out-of-state bank following the | 8 | | merger.
| 9 | | "Bylaws" means the bylaws of a bank that are adopted by the | 10 | | bank's board of
directors or shareholders for the regulation | 11 | | and management of the bank's
affairs. If the bank operates as a | 12 | | limited liability company, however, "bylaws"
means the | 13 | | operating
agreement of the bank.
| 14 | | "Call report fee" means the fee to be paid to the
| 15 | | Commissioner by each State bank pursuant to paragraph (a) of | 16 | | subsection (3)
of Section 48 of this Act.
| 17 | | "Capital" includes the aggregate of outstanding capital | 18 | | stock and
preferred stock.
| 19 | | "Cash flow reserve account" means the account within the | 20 | | books and records
of the Commissioner of Banks and Real Estate | 21 | | used to
record funds designated to maintain a reasonable Bank | 22 | | and Trust Company Fund
operating balance to meet agency | 23 | | obligations on a timely basis.
| 24 | | "Charter" includes the original charter and all amendments | 25 | | thereto
and articles of merger or consolidation.
| 26 | | "Commissioner" means the Commissioner of Banks and Real |
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| 1 | | Estate, except that beginning on April 6, 2009 (the effective | 2 | | date of Public Act 95-1047), all references in this Act to the | 3 | | Commissioner of Banks and Real Estate are deemed, in | 4 | | appropriate contexts, to be references to the Secretary of | 5 | | Financial and Professional Regulation.
| 6 | | "Commonly owned banks" means 2 or more banks that each | 7 | | qualify as a bank
subsidiary of the same bank holding company | 8 | | pursuant to Section 18 of the
Federal Deposit Insurance Act; | 9 | | "commonly owned bank" refers to one of a group
of commonly | 10 | | owned banks but only with respect to one or more of the other | 11 | | banks
in the same group.
| 12 | | "Community" means a city, village, or incorporated town | 13 | | and also includes
the area served by the banking offices of a | 14 | | bank, but need not be limited or
expanded to conform to the | 15 | | geographic boundaries of units of local
government.
| 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 passing | 25 | | out of existence.
| 26 | | "Continuing bank" means a merging bank, the charter of |
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| 1 | | which becomes the
charter of the resulting bank.
| 2 | | "Converting bank" means a State bank converting to become | 3 | | a national
bank, or a national bank converting to become a | 4 | | State bank.
| 5 | | "Converting trust company" means a trust company | 6 | | converting to become a
State bank.
| 7 | | "Court" means a court of competent jurisdiction.
| 8 | | "Director" means a member of the board of directors of a | 9 | | bank. In the case
of a manager-managed limited liability | 10 | | company, however, "director" means a
manager of
the bank and, | 11 | | in the case of a member-managed limited liability company,
| 12 | | "director" means a member of the bank. The term "director" | 13 | | does not include an
advisory director, honorary director, | 14 | | director emeritus, or similar person,
unless the person is | 15 | | otherwise performing
functions similar to those of a member of | 16 | | the board of directors.
| 17 | | "Director of Banking" means the Director of the Division | 18 | | of Banking of the Department of Financial and Professional | 19 | | Regulation. | 20 | | "Eligible depository institution" means an insured savings | 21 | | association
that is in default, an insured savings association | 22 | | that is in danger of
default, a State or national bank that is | 23 | | in default or a State or
national bank that is in danger of | 24 | | default, as those terms are defined in this
Section, or a new | 25 | | bank as that term defined in Section 11(m) of the Federal
| 26 | | Deposit Insurance Act or a bridge bank as that term is defined |
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| 1 | | in Section 11(n)
of the Federal Deposit Insurance Act or a new | 2 | | federal savings association
authorized under Section | 3 | | 11(d)(2)(f) of the Federal Deposit Insurance Act.
| 4 | | "Fiduciary" means trustee, agent, executor, administrator, | 5 | | committee,
guardian for a minor or for a person under legal | 6 | | disability, receiver,
trustee in bankruptcy, assignee for | 7 | | creditors, or any holder of similar
position of trust.
| 8 | | "Financial institution" means a bank, savings bank, | 9 | | savings and loan association,
credit union, or any licensee | 10 | | under the Consumer Installment Loan Act or
the Sales Finance | 11 | | Agency Act and, for purposes of Section 48.3, any
proprietary | 12 | | network, funds transfer corporation, or other entity providing
| 13 | | electronic funds transfer services, or any corporate | 14 | | fiduciary, its
subsidiaries, affiliates, parent company, or | 15 | | contractual service provider
that is examined by the | 16 | | Commissioner. For purposes of Section 5c and subsection (b) of | 17 | | Section 13 of this Act, "financial institution" includes any | 18 | | proprietary network, funds transfer corporation, or other | 19 | | entity providing electronic funds transfer services, and any | 20 | | corporate fiduciary.
| 21 | | "Foundation" means the Illinois Bank Examiners' Education | 22 | | Foundation.
| 23 | | "General obligation" means a bond, note, debenture, | 24 | | security, or other
instrument evidencing an obligation of the | 25 | | government entity that is the
issuer that is supported by the
| 26 | | full available resources of the issuer, the principal and |
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| 1 | | interest of which
is payable in whole or in part by taxation.
| 2 | | "Guarantee" means an undertaking or promise to answer for | 3 | | payment of
another's debt or performance of another's duty, | 4 | | liability, or obligation
whether "payment guaranteed" or | 5 | | "collection guaranteed".
| 6 | | "In danger of default" means a State or national bank, a | 7 | | federally chartered
insured savings association or an Illinois | 8 | | state chartered insured savings
association with respect to | 9 | | which the Commissioner or the appropriate
federal banking | 10 | | agency has advised the Federal Deposit Insurance
Corporation | 11 | | that:
| 12 | | (1) in the opinion of the Commissioner or the | 13 | | appropriate federal
banking agency,
| 14 | | (A) the State or national bank or insured savings | 15 | | association is not
likely to be able to meet the | 16 | | demands of the State or national bank's or
savings | 17 | | association's obligations in the normal course of | 18 | | business; and
| 19 | | (B) there is no reasonable prospect that the State | 20 | | or national bank or
insured savings association will | 21 | | be able to meet those demands or pay those
obligations | 22 | | without federal assistance; or
| 23 | | (2) in the opinion of the Commissioner or the | 24 | | appropriate federal
banking agency,
| 25 | | (A) the State or national bank or insured savings | 26 | | association has
incurred or is likely to incur losses |
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| 1 | | that will deplete all or substantially
all of its | 2 | | capital; and
| 3 | | (B) there is no reasonable prospect that the | 4 | | capital of the State
or national bank or insured | 5 | | savings association will be replenished without
| 6 | | federal assistance.
| 7 | | "In default" means, with respect to a State or national | 8 | | bank or an insured
savings association, any adjudication or | 9 | | other official determination by any
court of competent | 10 | | jurisdiction, the Commissioner, the appropriate federal
| 11 | | banking agency, or other public authority pursuant to which a | 12 | | conservator, receiver,
or other legal custodian is appointed | 13 | | for a State or national bank or an
insured savings | 14 | | association.
| 15 | | "Insured savings association" means any federal savings | 16 | | association chartered
under Section 5 of the federal Home | 17 | | Owners' Loan Act and any State savings
association chartered | 18 | | under the Illinois Savings and Loan Act of 1985 or a
| 19 | | predecessor Illinois statute, the deposits of which are | 20 | | insured by the Federal
Deposit Insurance Corporation. The term | 21 | | also includes a savings bank organized
or operating under the | 22 | | Savings Bank Act.
| 23 | | "Insured savings association in recovery" means an insured | 24 | | savings
association that is not an eligible depository | 25 | | institution and that does
not meet the minimum capital | 26 | | requirements applicable with respect to the
insured savings |
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| 1 | | association.
| 2 | | "Issuer" means for purposes of Section 33 every person who | 3 | | shall have
issued or proposed to issue any security; except | 4 | | that (1) with respect to
certificates of deposit, voting trust | 5 | | certificates, collateral-trust
certificates, and certificates | 6 | | of interest or shares in an unincorporated
investment trust | 7 | | not having a board of directors (or persons performing
similar | 8 | | functions), "issuer" means the person or persons performing | 9 | | the
acts and assuming the duties of depositor or manager | 10 | | pursuant to the
provisions of the trust, agreement, or | 11 | | instrument under which the
securities are issued; (2) with | 12 | | respect to trusts other than those
specified in clause (1) | 13 | | above, where the trustee is a corporation
authorized to accept | 14 | | and execute trusts, "issuer" means the entrusters,
depositors, | 15 | | or creators of the trust and any manager or committee charged
| 16 | | with the general direction of the affairs of the trust | 17 | | pursuant to the
provisions of the agreement or instrument | 18 | | creating the trust; and (3) with
respect to equipment trust | 19 | | certificates or like securities, "issuer" means
the person to | 20 | | whom the equipment or property is or is to be leased or
| 21 | | conditionally sold.
| 22 | | "Letter of credit" and "customer" shall have the meanings | 23 | | ascribed to
those terms in Section 5-102 of the Uniform | 24 | | Commercial Code.
| 25 | | "Main banking premises" means the location that is | 26 | | designated in a
bank's charter as its main office.
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| 1 | | "Maker or obligor" means for purposes of Section 33 the | 2 | | issuer of a
security, the promisor in a debenture or other debt | 3 | | security, or the
mortgagor or grantor of a trust deed or | 4 | | similar conveyance of a security
interest in real or personal | 5 | | property.
| 6 | | "Merged bank" means a merging bank that is not the | 7 | | continuing, resulting,
or surviving bank in a consolidation or | 8 | | merger.
| 9 | | "Merger" includes consolidation.
| 10 | | "Merging bank" means a party to a bank merger.
| 11 | | "Merging trust company" means a trust company party to a | 12 | | merger with
a State bank.
| 13 | | "Mid-tier bank holding company" means a corporation that | 14 | | (a) owns 100% of
the issued and outstanding shares of each | 15 | | class of stock of a State bank, (b)
has no other subsidiaries, | 16 | | and (c) 100% of the issued and outstanding shares of
the | 17 | | corporation are owned by a parent bank holding company.
| 18 | | "Municipality" means any municipality, political | 19 | | subdivision, school
district, taxing district, or agency.
| 20 | | "National bank" means a national banking association | 21 | | located in this
State and after May 31, 1997, means a national | 22 | | banking association without
regard to its location.
| 23 | | "Out-of-state bank" means a bank chartered under the laws | 24 | | of a state other
than Illinois, a territory of the United | 25 | | States, or the District of Columbia.
| 26 | | "Parent bank holding company" means a corporation that is |
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| 1 | | a bank holding
company as that term is defined in the Illinois | 2 | | Bank Holding Company Act of
1957 and owns 100% of the issued | 3 | | and outstanding shares of a mid-tier bank
holding company.
| 4 | | "Person" means an individual, corporation, limited | 5 | | liability company,
partnership, joint
venture, trust, estate, | 6 | | or unincorporated association.
| 7 | | "Public agency" means the State of Illinois, the various | 8 | | counties,
townships,
cities, towns, villages, school | 9 | | districts, educational service regions, special
road | 10 | | districts, public water supply districts, fire protection | 11 | | districts,
drainage districts, levee districts, sewer | 12 | | districts, housing authorities, the
Illinois Bank Examiners' | 13 | | Education Foundation, the Chicago Park District, and
all other | 14 | | political corporations or subdivisions of the State of | 15 | | Illinois,
whether now or hereafter created, whether herein | 16 | | specifically mentioned or
not, and shall also include any | 17 | | other
state or any political corporation or subdivision of | 18 | | another state.
| 19 | | "Public funds" or "public money" means
current operating | 20 | | funds, special funds, interest and sinking funds, and funds
of | 21 | | any kind or character belonging to, in the custody of, or | 22 | | subject to the
control or regulation of the United States or a | 23 | | public agency. "Public funds"
or "public money" shall include | 24 | | funds held by any of the officers, agents, or
employees of the | 25 | | United States or of a public agency in the course of their
| 26 | | official duties and, with respect to public money of the |
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| 1 | | United States, shall
include Postal Savings funds.
| 2 | | "Published" means, unless the context requires otherwise, | 3 | | the publishing
of the notice or instrument referred to in some | 4 | | newspaper of general
circulation in the community in which the | 5 | | bank is located at least once
each week for 3 successive weeks. | 6 | | Publishing shall be accomplished by, and
at the expense of, | 7 | | the bank required to publish. Where publishing is
required, | 8 | | the bank shall submit to the Commissioner that evidence of the
| 9 | | publication as the Commissioner shall deem appropriate.
| 10 | | "Qualified financial contract" means any security | 11 | | contract,
commodity contract, forward contract, including spot | 12 | | and
forward foreign exchange contracts, repurchase agreement, | 13 | | swap agreement, and
any
similar agreement, any option to enter | 14 | | into any such agreement, including any
combination of the | 15 | | foregoing, and any master agreement for such agreements.
A | 16 | | master agreement, together with all supplements thereto, shall | 17 | | be treated
as one qualified financial contract. The contract, | 18 | | option, agreement, or
combination of contracts, options, or | 19 | | agreements shall be reflected upon the
books, accounts, or | 20 | | records of the bank, or a party to the contract shall
provide | 21 | | documentary evidence of such agreement.
| 22 | | "Recorded" means the filing or recording of the notice or | 23 | | instrument
referred to in the office of the Recorder of the | 24 | | county wherein
the bank is located.
| 25 | | "Resulting bank" means the bank resulting from a merger or | 26 | | conversion.
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| 1 | | "Secretary" means the Secretary of Financial and | 2 | | Professional Regulation, or a person authorized by the | 3 | | Secretary or by this Act to act in the Secretary's stead. | 4 | | "Securities" means stocks, bonds, debentures, notes, or | 5 | | other similar
obligations.
| 6 | | "Special purpose trust company" means a special purpose | 7 | | trust company under Article IIA of the Corporate Fiduciary | 8 | | Act. | 9 | | "Stand-by letter of credit" means a letter of credit under | 10 | | which drafts
are payable upon the condition the customer has | 11 | | defaulted in performance of
a duty, liability, or obligation.
| 12 | | "State bank" means any banking corporation that has a | 13 | | banking charter
issued by the Commissioner under
this Act.
| 14 | | "State Banking Board" means the State Banking Board of | 15 | | Illinois.
| 16 | | "Subsidiary" with respect to a specified company means a | 17 | | company that is
controlled by the specified company. For | 18 | | purposes of paragraphs (8) and (12)
of Section 5 of this Act, | 19 | | "control" means the exercise of operational or
managerial | 20 | | control of a corporation by the bank, either alone or together | 21 | | with
other affiliates of the bank.
| 22 | | "Surplus" means the aggregate of (i) amounts paid in | 23 | | excess of the par
value of capital stock and preferred stock; | 24 | | (ii) amounts contributed other
than for capital stock and | 25 | | preferred stock and allocated to the surplus
account; and | 26 | | (iii) amounts transferred from undivided profits.
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| 1 | | "Tier 1 Capital" and "Tier 2 Capital" have the meanings | 2 | | assigned to those
terms in regulations promulgated for the | 3 | | appropriate federal banking agency of
a state bank, as those | 4 | | regulations are now or hereafter amended.
| 5 | | "Trust company" means a limited liability company or | 6 | | corporation
incorporated in this State for the
purpose of | 7 | | accepting and executing trusts.
| 8 | | "Undivided profits" means undistributed earnings less | 9 | | discretionary
transfers to surplus.
| 10 | | "Unimpaired capital and unimpaired surplus", for the | 11 | | purposes of paragraph
(21) of Section 5 and Sections 32, 33, | 12 | | 34, 35.1, 35.2, and 47 of this Act means
the sum of the state | 13 | | bank's Tier 1 Capital and Tier 2 Capital plus such other
| 14 | | shareholder equity as may be included by
regulation of the | 15 | | Commissioner. Unimpaired capital and unimpaired surplus
shall | 16 | | be calculated on the basis of the date of the last quarterly | 17 | | call report
filed with the Commissioner preceding the date of | 18 | | the transaction for which the
calculation is made, provided | 19 | | that: (i) when a material event occurs after the
date of the | 20 | | last quarterly call report filed with the Commissioner that | 21 | | reduces
or increases the bank's unimpaired capital and | 22 | | unimpaired surplus by 10% or
more, then the unimpaired capital | 23 | | and unimpaired surplus shall be calculated
from the date of | 24 | | the material
event for a transaction conducted after the date | 25 | | of the material event; and
(ii) if the Commissioner determines | 26 | | for safety and soundness reasons that a
state bank should |
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| 1 | | calculate unimpaired capital and unimpaired surplus more
| 2 | | frequently than provided by this paragraph, the Commissioner | 3 | | may by written
notice direct the bank to calculate unimpaired | 4 | | capital and unimpaired surplus
at a more frequent interval. In | 5 | | the case of a state bank newly chartered under
Section 13 or a | 6 | | state bank resulting from a merger, consolidation, or
| 7 | | conversion under Sections 21 through 26 for which no preceding | 8 | | quarterly call
report has been filed with the Commissioner, | 9 | | unimpaired capital and unimpaired
surplus shall be calculated | 10 | | for the first calendar quarter on the basis of the
effective | 11 | | date of the charter, merger, consolidation, or conversion.
| 12 | | (Source: P.A. 95-924, eff. 8-26-08; 95-1047, eff. 4-6-09; | 13 | | 96-1000, eff. 7-2-10; 96-1163, eff. 1-1-11.)
| 14 | | (205 ILCS 5/30) (from Ch. 17, par. 337)
| 15 | | Sec. 30. Conversion; merger with trust company or special | 16 | | purpose trust company . Upon approval by the Commissioner a | 17 | | trust company having power so to do
under the law under which | 18 | | it is organized may convert into a state bank or
may merge into | 19 | | a state bank as prescribed by this Act; except that the
action | 20 | | by a trust company shall be taken in the manner prescribed by | 21 | | and
shall be subject to limitations and requirements imposed | 22 | | by the law under
which it is organized which law shall also | 23 | | govern the rights of its
dissenting stockholders. The rights | 24 | | of dissenting stockholders of a state
bank shall be governed | 25 | | by Section 29 of this Act. The conversion or
merger procedure |
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| 1 | | shall be:
| 2 | | (1) In the case of a merger, the board of directors of both | 3 | | the merging
trust company and the merging bank by a majority of | 4 | | the entire board in
each case shall approve a merger agreement | 5 | | which shall contain:
| 6 | | (a) The name and location of the merging bank and of | 7 | | the merging trust
company and a list of the stockholders | 8 | | of each as of the date of the merger
agreement;
| 9 | | (b) With respect to the resulting bank (i) its name | 10 | | and place of
business; (ii) the amount of capital, surplus | 11 | | and reserve for operating
expenses; (iii) the classes and | 12 | | the number of shares of stock and the par
value of each | 13 | | share; (iv) the charter which is to be the charter of the
| 14 | | resulting bank, together with the amendments to the | 15 | | continuing charter and
to the continuing by-laws; and (v) | 16 | | a detailed financial statement showing
the assets and | 17 | | liabilities after the proposed merger;
| 18 | | (c) Provisions governing the manner of converting the | 19 | | shares of the
merging bank and of the merging trust | 20 | | company into shares of the resulting
bank;
| 21 | | (d) A statement that the merger agreement is subject | 22 | | to approval by the
Commissioner and by the stockholders of | 23 | | the merging bank and the merging
trust company, and that | 24 | | whether approved or disapproved, the parties
thereto will | 25 | | pay the Commissioner's expenses of examination;
| 26 | | (e) Provisions governing the manner of disposing of |
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| 1 | | the shares of the
resulting bank not taken by the | 2 | | dissenting stockholders of the merging
trust company; and
| 3 | | (f) Such other provisions as the Commissioner may | 4 | | reasonably require to
enable him to discharge his duties | 5 | | with respect to the merger.
| 6 | | (2) After approval by the board of directors of the | 7 | | merging bank and of
the merging trust company, the merger | 8 | | agreement shall be submitted to the
Commissioner for approval | 9 | | together with the certified copies of the
authorizing | 10 | | resolution of each board of directors showing approval by a
| 11 | | majority of each board.
| 12 | | (3) After receipt by the Commissioner of the papers | 13 | | specified in
subsection (2), he shall approve or disapprove | 14 | | the merger agreement. The
Commissioner shall not approve the | 15 | | agreement unless he shall be of the
opinion and finds:
| 16 | | (a) That the resulting bank meets the requirements of | 17 | | this Act for the
formation of a new bank at the proposed | 18 | | place of business of the resulting
bank;
| 19 | | (b) That the same matters exist in respect of the | 20 | | resulting bank which
would have been required under | 21 | | Section 10 of this Act for the organization
of a new bank; | 22 | | and
| 23 | | (c) That the merger agreement is fair to all persons | 24 | | affected. If the
Commissioner disapproves the merger | 25 | | agreement, he shall state his
objections in writing and | 26 | | give an opportunity to the merging bank and the
merging |
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| 1 | | trust company to obviate such objections.
| 2 | | (4) To be effective, if approved by the Commissioner, a | 3 | | merger of a bank
and a trust company where there is to be a | 4 | | resulting bank must be approved
by the affirmative vote of the | 5 | | holders of at least two-thirds of the
outstanding shares of | 6 | | stock of the merging bank entitled to vote at a
meeting called | 7 | | to consider such action, unless holders of preferred stock
are | 8 | | entitled to vote as a class in respect thereof, in which event | 9 | | the
proposed merger shall be adopted upon receiving the | 10 | | affirmative vote of the
holders of at least two-thirds of the | 11 | | outstanding shares of each class of
shares entitled to vote as | 12 | | a class in respect thereof and of the total
outstanding shares | 13 | | entitled to vote at such meeting and must be approved by
the | 14 | | stockholders of the merging trust company as provided by the | 15 | | Act under
which it is organized. The prescribed vote by the | 16 | | merging bank and the
merging trust company shall constitute | 17 | | the adoption of the charter and
by-laws of the continuing | 18 | | bank, including the amendments in the merger
agreement, as the | 19 | | charter and by-laws of the resulting bank. Written or
printed | 20 | | notice of the meeting of the stockholders of the merging bank | 21 | | shall be given to each stockholder of record entitled to
vote | 22 | | at such meeting at least thirty days before such meeting and in | 23 | | the
manner provided in this Act for the giving of notice of | 24 | | meetings of
stockholders. The notice shall state that | 25 | | dissenting stockholders of the merging
trust company will be | 26 | | entitled to payment of the value of those shares
which are |
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| 1 | | voted against approval of the merger, if a proper demand is | 2 | | made
on the resulting bank and the requirements of the Act | 3 | | under which the
merging trust company is organized are | 4 | | satisfied.
| 5 | | (5) Unless a later date is specified in the merger | 6 | | agreement, the merger
shall become effective upon the filing | 7 | | with the Commissioner of the
executed merger agreement, | 8 | | together with copies of the resolutions of the
stockholders of | 9 | | the merging bank and the merging trust company approving
it, | 10 | | certified by the president or a vice-president or, the cashier | 11 | | and also
by the secretary or other officer charged with | 12 | | keeping the records. The
charter of the merging trust company | 13 | | shall thereupon automatically
terminate. The Commissioner | 14 | | shall thereupon issue to the continuing bank a
certificate of | 15 | | merger which shall specify the name of the merging trust
| 16 | | company, the name of the continuing bank and the amendments to | 17 | | the charter
of the continuing bank provided for by the merger | 18 | | agreement. Such
certificate shall be conclusive evidence of | 19 | | the merger and of the
correctness of all proceedings therefor | 20 | | in all courts and places including
the office of the Secretary | 21 | | of State, and said certificate shall be
recorded.
| 22 | | (6) In the case of a conversion, a trust company shall | 23 | | apply for a
charter by filing with the Commissioner:
| 24 | | (a) A certificate signed by its president, or a | 25 | | vice-president, and by a
majority of the entire board of | 26 | | directors setting forth the corporate
action taken in |
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| 1 | | compliance with the provisions of the Act under which it | 2 | | is
organized governing the conversion of a trust company | 3 | | to a bank or
governing the merger of a trust company into | 4 | | another corporation;
| 5 | | (b) The plan of conversion and the proposed charter | 6 | | approved by the
stockholders for the operation of the | 7 | | trust company as a bank. The plan of
conversion shall | 8 | | contain (i) the name and location proposed for the
| 9 | | converting trust company; (ii) a list of its stockholders | 10 | | as of the date of
the stockholders' approval of the plan of | 11 | | conversion; (iii) the amount of
its capital, surplus and | 12 | | reserve for operating expenses; (iv) the classes
and the | 13 | | number of shares of stock and the par value of each share; | 14 | | (v) the
charter which is to be the charter of the resulting | 15 | | bank; and (vi) a
detailed financial statement showing the | 16 | | assets and liabilities of the
converting trust company;
| 17 | | (c) A statement that the plan of conversion is subject | 18 | | to approval by
the Commissioner and that, whether approved | 19 | | or disapproved, the converting
trust company will pay the | 20 | | Commissioner's expenses of examination; and
| 21 | | (d) Such other instruments as the Commissioner may | 22 | | reasonably require to
enable him to discharge his duties | 23 | | with respect to the conversion.
| 24 | | (7) After receipt by the Commissioner of the papers | 25 | | specified in
subsection (6), he shall approve or disapprove | 26 | | the plan of conversion. The
Commissioner shall not approve the |
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| 1 | | plan of conversion unless he shall be of
the opinion and finds:
| 2 | | (a) That the resulting bank meets the requirements of | 3 | | this Act for the
formation of a new bank at the proposed | 4 | | place of business of the resulting
bank;
| 5 | | (b) That the same matters exist in respect of the | 6 | | resulting bank which
would have been required under | 7 | | Section 10 of this Act for the
organization of a new bank; | 8 | | and
| 9 | | (c) That the plan of conversion is fair to all persons | 10 | | affected.
| 11 | | If the commissioner disapproves the plan of conversion, he | 12 | | shall state
his objections in writing and give an opportunity | 13 | | to the converting trust
company to obviate such objections.
| 14 | | (8) Unless a later date is specified in the plan of | 15 | | conversion, the
conversion shall become effective upon the | 16 | | Commissioner's approval, and the
charter proposed in the plan | 17 | | of conversion shall constitute the charter of
the resulting | 18 | | bank. The Commissioner shall issue a certificate of
conversion | 19 | | which shall specify the name of the converting trust company,
| 20 | | the name of the resulting bank and the charter provided for by | 21 | | said plan of
conversion. Such certificate shall be conclusive | 22 | | evidence of the conversion
and of the correctness of all | 23 | | proceedings therefor in all courts and places
including the | 24 | | office of the Secretary of State, and such certificate shall
| 25 | | be recorded.
| 26 | | (8.5) A special purpose trust company under Article IIA of |
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| 1 | | the Corporate Fiduciary Act may merge with a State bank or | 2 | | convert to a State bank as if the special purpose trust company | 3 | | were a trust company under Article II of the Corporate | 4 | | Fiduciary Act, subject to rules adopted by the Department. | 5 | | (9) In the case of either a merger or a conversion under | 6 | | this Section
30, the resulting bank shall be considered the | 7 | | same business and corporate
entity as each merging bank and | 8 | | merging trust company or as the converting
trust company with | 9 | | all the property, rights, powers, duties and obligations
of | 10 | | each as specified in Section 28 of this Act.
| 11 | | (Source: P.A. 91-357, eff. 7-29-99.)
| 12 | | Section 10. The Corporate Fiduciary Act is amended by | 13 | | adding Article IIA as follows: | 14 | | (205 ILCS 620/Art. IIA heading new) | 15 | | ARTICLE IIA. SPECIAL PURPOSE TRUST COMPANY | 16 | | AUTHORITY AND ORGANIZATION | 17 | | (205 ILCS 620/2A-1 new) | 18 | | Sec. 2A-1. Special purpose trust company. Any corporation | 19 | | that has been or shall be incorporated under the general | 20 | | corporation laws of this State for the special purpose of | 21 | | providing fiduciary custodial services or providing other like | 22 | | or related services as specified by rule, consistent with this | 23 | | Article, may be appointed to act as a fiduciary with respect to |
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| 1 | | such services and shall be designated a special purpose trust | 2 | | company. | 3 | | (205 ILCS 620/2A-2 new) | 4 | | Sec. 2A-2. Certificate of authority. | 5 | | (a) It shall not be lawful for any person to engage in the | 6 | | activity of a special purpose trust company after the | 7 | | effective date of this amendatory Act of the 102nd General | 8 | | Assembly without first filing an application for and procuring | 9 | | from the Secretary a certificate of authority stating that the | 10 | | person has complied with the requirements of this Act and is | 11 | | qualified to engage in the activity of a special purpose trust | 12 | | company. | 13 | | (b) No natural person or natural persons, firm, or | 14 | | partnership, or corporation not having been authorized under | 15 | | this Act shall transact in the activity of a special purpose | 16 | | trust company. A person who violates this Section is guilty of | 17 | | a Class A misdemeanor and the Attorney General or State's | 18 | | Attorney of the county in which the violation occurs may | 19 | | restrain the violation by a complaint for injunctive relief. | 20 | | (c) Any entity that holds a certificate of authority under | 21 | | Article II of this Act may engage in the activity of a special | 22 | | purpose trust company without applying for or receiving a | 23 | | certificate of authority under this Article IIA. | 24 | | (205 ILCS 620/2A-3 new) |
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| 1 | | Sec. 2A-3. Rulemaking and organization. | 2 | | (a) The Department shall adopt rules for the | 3 | | administration of this Article, including, but not limited to: | 4 | | rules for defining statutory terms; applying for a certificate | 5 | | of authority; review, investigation, and approval of | 6 | | application for certificate of authority; capital | 7 | | requirements; merger, change of control, conversion, and | 8 | | successor trustee; office location and name; collateralizing | 9 | | fiduciary assets; and general corporate powers. | 10 | | (b) Articles V, VI, VII, VIII and IX of this Act shall | 11 | | apply to a special purpose trust company under this Article as | 12 | | if the special purpose trust company were a trust company | 13 | | authorized under Article II of this Act, subject to any rules | 14 | | adopted by the Department. | 15 | | Section 15. The Blockchain Business Development Act is | 16 | | amended by adding Section 11 as follows: | 17 | | (205 ILCS 725/11 new) | 18 | | Sec. 11. Digital asset custody rules. | 19 | | (a) As used in this Section, "digital asset" means a | 20 | | representation of economic, proprietary, or access rights that | 21 | | is stored in a computer readable format. | 22 | | (b) The Department of Financial and Professional | 23 | | Regulation, in addition to the authority provided under any | 24 | | other law, shall have authority to adopt rules, opinions, or |
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| 1 | | interpretive letters regarding the provision of custodial | 2 | | services for digital assets by banks chartered under the | 3 | | Illinois Banking Act, savings banks chartered under the | 4 | | Savings Bank Act, and corporate fiduciaries authorized under | 5 | | Article II or IIA of the Corporate Fiduciary Act.
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| 1 | |
INDEX
| 2 | |
Statutes amended in order of appearance
| | 3 | | 205 ILCS 5/2 | from Ch. 17, par. 302 | | 4 | | 205 ILCS 5/30 | from Ch. 17, par. 337 | | 5 | | 205 ILCS 620/Art. IIA | 6 | | heading new | | | 7 | | 205 ILCS 620/2A-1 new | | | 8 | | 205 ILCS 620/2A-2 new | | | 9 | | 205 ILCS 620/2A-3 new | | | 10 | | 205 ILCS 725/11 new | |
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