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.