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Public Act 91-0097
SB378 Enrolled LRB9103597JSpc
AN ACT relating to the regulations of certain financial
businesses, amending named Acts.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Savings and Loan Act of 1985 is
amended by changing Sections 1-6 and 7-11 as follows:
(205 ILCS 105/1-6) (from Ch. 17, par. 3301-6)
Sec. 1-6. General corporate powers. An association
operating under this Act shall be a body corporate and
politic and shall have all of the specific powers conferred
by this Act including, but not limited to and, in addition
thereto, the following general powers:
(a) To sue and be sued, complain and defend in its
corporate name, and to have a common seal, which it may alter
or renew at pleasure;
(b) To obtain and maintain insurance of the
association's withdrawable capital by an insurance
corporation as defined in this Act;
(c) Notwithstanding anything to the contrary contained
in this Act, to become a member of the Federal Home Loan
Bank, and to have all of the powers granted to a savings or
thrift institution organized under the laws of the United
States and which is located and doing business in the State
of Illinois, subject to regulations of the Commissioner;
(d) To act as a fiscal agent for the United States, the
State of Illinois or any department, branch, arm or agency of
the State or any unit of local government or school district
in the State when duly designated for that purpose, and as
agent to perform the reasonable functions as may be required
of it;
(e) To become a member of or deal with any corporation
or agency of the United States or the State of Illinois, to
the extent that the agency assists in furthering or
facilitating the association's purposes or powers and to that
end to purchase stock or securities thereof or deposit money
therewith, and to comply with any other conditions of
membership or credit;
(f) To make donations in reasonable amounts for the
public welfare or for charitable, scientific, religious or
educational purposes;
(g) To adopt and operate reasonable insurance, bonus,
profit sharing, and retirement plans for officers and
employees; likewise, directors who are not officers,
including, but not limited to, advisory, honorary, and
emeritus directors, may participate in those plans;
(h) To reject any application for membership, to retire
withdrawable capital by enforced retirement as provided in
this Act and the by-laws, and to limit the issuance of or
payments on withdrawable capital, subject, however, to
contractual obligations;
(i) To purchase stock in service corporations and to
invest in any form of indebtedness of any service corporation
as defined in this Act, subject to regulations of the
Commissioner;
(j) To purchase stock of a corporation whose principal
purpose is to operate a safe deposit company or escrow
service company;
(k) To act as Trustee or Custodian under the Federal
Self-Employed Individuals' Tax Retirement Act of 1962 or any
amendments thereto or any other retirement account and invest
any funds held in such capacity in a savings account of the
institution;
(l) (Blank);
(m) To establish, maintain and operate terminals as
authorized by the Electronic Fund Transfer Act and by Section
5 of the Illinois Banking Act. The establishment,
maintenance, operation and location of such terminals shall
be subject to the approval of the Commissioner;
(n) Subject to the approval and regulations of the
Commissioner, an association may purchase or assume all or
any part of the assets or liabilities of an eligible insured
bank;
(o) To purchase from a bank, as defined in Section 2 of
the Illinois Banking Act, an insubstantial portion of the
total deposits of an insured bank. For the purpose of this
subparagraph, "insubstantial portion of the total deposits"
shall have the same meaning as provided in Section 5(d)(2)(D)
of the Federal Deposit Insurance Act;
(p) To effect an acquisition of or conversion to another
financial institution pursuant to Section 205 of the
Financial Institutions Reform, Recovery and Enforcement Act
of 1989;
(q) To pledge its assets:
(1) to enable it to act as an agent for the sale of
obligations of the United States;
(2) to secure deposits;
(3) to secure deposits of money whenever required
by the National Bankruptcy Act;
(4) to qualify under Section 2-9 of the Corporate
Fiduciary Act; and
(5) to secure trust funds commingled with the
institution's funds, whether deposited by the institution
or an affiliate of the institution, as required under
Section 2-8 of the Corporate Fiduciary Act;
(r) To provide temporary periodic service to persons
residing in a bona fide nursing home, senior citizens'
retirement home, or long-term care facility;
(s) To purchase for its own account shares of stock of a
bankers' bank, described in Section 13(b)(1) of the Illinois
Banking Act, on the same terms and conditions as a bank may
purchase such shares. In no event shall the total amount of
such stock held by an association in such bankers' bank
exceed 10% of its capital and surplus (including undivided
profits) and in no event shall an association acquire more
than 5% of any class of voting securities of such bankers'
bank;
(t) To effect a conversion to a State bank pursuant to
the provisions of the Illinois Banking Act; and
(u) Subject to Article XLIV of the Illinois Insurance
Code, to act as the agent for any fire, life, or other
insurance company authorized by the State of Illinois, by
soliciting and selling insurance and collecting premiums on
policies issued by such company; and may receive for services
so rendered such fees or commissions as may be agreed upon
between the said association and the insurance company for
which it may act as agent; provided, however, that no such
association shall in any case assume or guarantee the payment
of any premium on insurance policies issued through its
agency by its principal; and provided further, that the
association shall not guarantee the truth of any statement
made by an assured in filing his application for insurance;
and.
(v) To exercise all powers necessary to qualify as a
trustee or custodian under federal or State law, however, the
authority to accept and execute trusts is subject to the
Corporate Fiduciary Act and to the supervision of those
activities by the Commissioner.
(Source: P.A. 89-74, eff. 6-30-95; 89-310, eff. 1-1-96;
89-317, eff. 8-11-95; 89-355, eff. 8-17-95; 89-567, eff.
7-26-96; 89-603, eff. 8-2-96; 89-626, eff. 8-9-96; 90-14,
eff. 7-1-97; 90-41, eff. 10-1-97.)
(205 ILCS 105/7-11) (from Ch. 17, par. 3307-11)
Sec. 7-11. Commissioner's authority to take custody and
appoint a conservator. The Commissioner in his discretion may
take custody of, and appoint a conservator for, the property,
liabilities, books, records, business and assets of every
kind and character of any association, trust or association
in liquidation, for any of the purposes hereinafter
enumerated, if it appears from reports made to the
Commissioner, or from examination made by or on behalf of the
Commissioner:
(a) That the directors, officers, trustees or
liquidators have neglected, failed or refused to take any
action which the Commissioner may deem necessary for the
protection of the association or trust or have impeded or
obstructed an examination; or
(b) That the withdrawable capital of the association is
impaired to the extent that the realizable value of its
assets is insufficient to pay in full its creditors and
holders of its withdrawable capital; or that its permanent
reserve capital is impaired; or
(c) That the association is unable to continue
operation; or
(d) That the business of the association, trust or
association in liquidation is being conducted in a
fraudulent, illegal or unsafe manner; or
(e) That the officers, employees, trustees or
liquidators have continued to assume duties or perform acts
without giving bond as required by the provisions of this
Act.
Unless the Commissioner finds that an emergency exists
which may result in loss to members or creditors and requires
that he take custody immediately, he first shall give written
notice to the directors, trustees or liquidators specifying
the conditions criticized and state a reasonable time within
which correction may be made. If however, an association
whose accounts are insured by the Federal Savings and Loan
Insurance Corporation is impaired within the meaning of
paragraph (b) above, or any other condition exists which
would give the Commissioner authority to take custody of an
insured institution, the action of the Commissioner can be
withheld provided that the Commissioner determines from
reports made to him by the Association, and such other
examinations as may be deemed necessary, that the Association
has sufficient liquid assets and has adopted and implemented
an operating plan satisfactory to the Commissioner. In such
case the Commissioner may defer a custody action pending a
satisfactory resolution of the impairment as suggested by
either the Association or the Federal Savings and Loan
Insurance Corporation.
If any condition exists that would give the Commissioner
authority to take custody of an association, the action of
the Commissioner may be withheld pending a satisfactory
resolution of the condition as suggested by the insurance
corporation provided the association has sufficient liquidity
and has adopted and implemented an operating plan the
Commissioner considers prudent.
No action or inaction of the Commissioner taken pursuant
to this Article shall cause the Commissioner to be personally
liable for such action or inaction unless the Commissioner's
action or inaction is found to be in violation of a criminal
statute. The Commissioner shall promulgate rules and
regulations to govern the determination of a need for a
conservator and the selection, appointment and conduct of a
conservatorship, including allocation of payment and costs.
(Source: P.A. 85-1143.)
Section 10. The Savings Bank Act is amended by changing
Sections 1007.105, 1008, 4005, 6002, 8016, 9009, 11005, and
11008 and adding Section 4014 as follows:
(205 ILCS 205/1007.105) (from Ch. 17, par. 7301-7.105)
Sec. 1007.105. "Service corporation" means any
corporation that is 51% or more owned by one or more savings
banks, or by savings banks and other depository institutions,
whose purposes are reasonably incident to the accomplishment
of the express or incidental powers conferred upon savings
banks by this Act.
(Source: P.A. 86-1213.)
(205 ILCS 205/1008) (from Ch. 17, par. 7301-8)
Sec. 1008. General corporate powers.
(a) A savings bank operating under this Act shall be a
body corporate and politic and shall have all of the specific
powers conferred by this Act including, but not limited to
and in addition thereto, the following general powers:
(1) To sue and be sued, complain, and defend in its
corporate name and to have a common seal, which it may
alter or renew at pleasure.
(2) To obtain and maintain insurance by a deposit
insurance corporation as defined in this Act.
(3) To act as a fiscal agent for the United States,
the State of Illinois or any department, branch, arm, or
agency of the State or any unit of local government or
school district in the State, when duly designated for
that purpose, and as agent to perform reasonable
functions as may be required of it.
(4) To become a member of or deal with any
corporation or agency of the United States or the State
of Illinois, to the extent that the agency assists in
furthering or facilitating its purposes or powers and to
that end to purchase stock or securities thereof or
deposit money therewith, and to comply with any other
conditions of membership or credit.
(5) To make donations in reasonable amounts for the
public welfare or for charitable, scientific, religious,
or educational purposes.
(6) To adopt and operate reasonable insurance,
bonus, profit sharing, and retirement plans for officers
and employees and for directors including, but not
limited to, advisory, honorary, and emeritus directors,
who are not officers or employees.
(7) To reject any application for membership; to
retire deposit accounts by enforced retirement as
provided in this Act and the bylaws; and to limit the
issuance of, or payments on, deposit accounts, subject,
however, to contractual obligations.
(8) To purchase stock in service corporations and
to invest in any form of indebtedness of any service
corporation as defined in this Act, subject to
regulations of the Commissioner.
(9) To purchase stock of a corporation whose
principal purpose is to operate a safe deposit company or
escrow service company.
(10) To exercise all the powers necessary to
qualify as a trustee or custodian under federal or State
law, provided that the authority to accept and execute
trusts is subject to the provisions of the Corporate
Fiduciary Act and to the supervision of those activities
by the Commissioner of Banks and Real Estate.
(11) (Blank).
(12) To establish, maintain, and operate terminals
as authorized by the Electronic Fund Transfer Act. The
establishment, maintenance, operation, and location of
those terminals shall be subject to the approval of the
Commissioner.
(13) To pledge its assets:
(A) to enable it to act as agent for the sale
of obligations of the United States;
(B) to secure deposits;
(C) to secure deposits of money whenever
required by the National Bankruptcy Act;
(D) to qualify under Section 2-9 of the
Corporate Fiduciary Act; and
(E) to secure trust funds commingled with the
savings bank's funds, whether deposited by the
savings bank or an affiliate of the savings bank, as
required under Section 2-8 of the Corporate
Fiduciary Act.
(14) To accept for payment at a future date not to
exceed one year from the date of acceptance, drafts drawn
upon it by its customers; and to issue, advise, or
confirm letters of credit authorizing holders thereof to
draw drafts upon it or its correspondents.
(15) Subject to the regulations of the
Commissioner, to own and lease personal property acquired
by the savings bank at the request of a prospective
lessee and, upon the agreement of that person, to lease
the personal property.
(16) To establish temporary service booths at any
International Fair in this State that is approved by the
United States Department of Commerce for the duration of
the international fair for the purpose of providing a
convenient place for foreign trade customers to exchange
their home countries' currency into United States
currency or the converse. To provide temporary periodic
service to persons residing in a bona fide nursing home,
senior citizens' retirement home, or long-term care
facility. These powers shall not be construed as
establishing a new place or change of location for the
savings bank providing the service booth.
(17) To indemnify its officers, directors,
employees, and agents, as authorized for corporations
under Section 8.75 of the Business Corporations Act of
1983.
(18) To provide data processing services to others
on a for-profit basis.
(19) To utilize any electronic technology to
provide customers with home banking services.
(20) Subject to the regulations of the
Commissioner, to enter into an agreement to act as a
surety.
(21) Subject to the regulations of the
Commissioner, to issue credit cards, extend credit
therewith, and otherwise engage in or participate in
credit card operations.
(22) To purchase for its own account shares of
stock of a bankers' bank, described in Section 13(b)(1)
of the Illinois Banking Act, on the same terms and
conditions as a bank may purchase such shares. In no
event shall the total amount of such stock held by a
savings bank in such bankers' bank exceed 10% of its
capital and surplus (including undivided profits) and in
no event shall a savings bank acquire more than 5% of any
class of voting securities of such bankers' bank.
(23) With respect to affiliate facilities:
(A) to conduct at affiliate facilities any of
the following transactions for and on behalf of any
affiliated depository institution, if so authorized
by the affiliate or affiliates: receiving deposits;
renewing deposits; cashing and issuing checks,
drafts, money orders, travelers checks, or similar
instruments; changing money; receiving payments on
existing indebtedness; and conducting ministerial
functions with respect to loan applications,
servicing loans, and providing loan account
information; and
(B) to authorize an affiliated depository
institution to conduct for and on behalf of it, any
of the transactions listed in this subsection at one
or more affiliate facilities.
A savings bank intending to conduct or to authorize
an affiliated depository institution to conduct at an
affiliate facility any of the transactions specified in
this subsection shall give written notice to the
Commissioner at least 30 days before any such transaction
is conducted at an affiliate facility. All conduct under
this subsection shall be on terms consistent with safe
and sound banking practices and applicable law.
(24) Subject to Article XLIV of the Illinois
Insurance Code, to act as the agent for any fire, life,
or other insurance company authorized by the State of
Illinois, by soliciting and selling insurance and
collecting premiums on policies issued by such company;
and may receive for services so rendered such fees or
commissions as may be agreed upon between the said
savings bank and the insurance company for which it may
act as agent; provided, however, that no such savings
bank shall in any case assume or guarantee the payment of
any premium on insurance policies issued through its
agency by its principal; and provided further, that the
savings bank shall not guarantee the truth of any
statement made by an assured in filing his application
for insurance.
(25) To become a member of the Federal Home Loan
Bank and to have the powers granted to a savings
association organized under the Illinois Savings and Loan
Act of 1985 or the laws of the United States, subject to
regulations of the Commissioner.
(26) To offer any product or service that is at the
time authorized or permitted to a bank by applicable law,
but subject always to the same limitations and
restrictions that are applicable to the bank for the
product or service by such applicable law and subject to
the applicable provisions of the Financial Institutions
Insurance Sales Law and rules of the Commissioner.
(b) If this Act or the regulations adopted under this
Act fail to provide specific guidance in matters of corporate
governance, the provisions of the Business Corporation Act of
1983 may be used.
(Source: P.A. 89-74, eff. 6-30-95; 89-310, eff. 1-1-96;
89-317, eff. 8-11-95; 89-355, eff. 8-17-95; 89-508, eff.
7-3-96; 89-603, eff. 8-2-96; 89-626, eff. 8-9-96; 90-14, eff.
7-1-97; 90-41, eff. 10-1-97; 90-270, eff. 7-30-97; 90-301,
eff. 8-1-97; 90-655, eff. 7-30-98; 90-665, eff. 7-30-98;
revised 10-31-98.)
(205 ILCS 205/4005) (from Ch. 17, par. 7304-5)
Sec. 4005. Voting.
(a) Voting at a meeting may be either in person or by
proxy executed in writing by the member or stockholder or by
his duly authorized attorney-in-fact.
(b) In the determination of all questions requiring
ascertainment of who is entitled to vote and of the number of
outstanding shares, the following rules shall apply:
(1) The date of determination shall be the record
date for voting provided in this Act.
(2) Each person holding one or more withdrawable
accounts in a mutual savings bank shall have the vote of
one share for each $100 of the aggregate withdrawal value
of the accounts and shall have the vote of one share for
any fraction of $100; however, subject to regulation of
the Commissioner, a mutual savings bank may in its
by-laws limit the number of votes a person may cast to
1,000 votes. A mutual savings bank may adopt a different
voting arrangement if the Commissioner finds that the
arrangement would not be inequitable to members and if
the members approve the arrangement by an affirmative
vote of at least two-thirds of the votes entitled to be
cast, however, the voting arrangement need not obtain the
foregoing member approval if such voting arrangement is
otherwise approved as part of a corporate change under
this Act.
(3) Each holder of capital stock held shall have
one vote for each share held.
(4) Shares owned by the savings bank shall not be
counted or voted.
(5) A savings bank authorized to issue stock shall
provide in its articles of incorporation that voting
rights may be vested exclusively in stockholders.
(Source: P.A. 88-579, eff. 8-12-94.)
(205 ILCS 205/4014 new)
Sec. 4014. Waiver of notice. Whenever any notice
whatsoever is required to be given under this Act or under
the provisions of the articles of incorporation or bylaws of
a savings bank, a waiver thereof in writing signed by the
person entitled to the notice, whether before or after the
time stated therein, shall be deemed equivalent to the giving
of the notice. Attendance at any meeting shall constitute
waiver of notice thereof unless the person at the meeting
objects to the holding of the meeting because proper notice
was not given.
(205 ILCS 205/6002) (from Ch. 17, par. 7306-2)
Sec. 6002. Investment in loans. Subject to the
regulations of the Commissioner, a savings bank may loan
funds as follows:
(1) On the security of deposit accounts, but no such
loan shall exceed the withdrawal value of the pledged
account.
(2) On the security of real estate:
(A) of a value, determined in accordance with this
Act, sufficient to provide good and ample security for
the loan;
(B) with a fee simple title or a leasehold title;
(C) with the title established by evidence of title
as is consistent with sound lending practices in the
locality;
(D) with the security interest in the real estate
evidenced by an appropriate written instrument and the
loan evidenced by a note, bond, or similar written
instrument; a loan on the security of the whole of the
beneficial interest in a land trust satisfies the
requirements of this paragraph if the title to the land
is held by a corporate trustee and if the real estate
held in the land trust meets the other requirements of
this subsection;
(E) with a mortgage loan not to exceed 40 years.
(3) For the purpose of repair, improvement,
rehabilitation, furnishing, or equipment of real estate.
(4) For the purpose of financing or refinancing an
existing ownership interest in certificates of stock,
certificates of beneficial interest, other evidence of an
ownership interest in, or a proprietary lease from a
corporation, trust, or partnership formed for the purpose of
the cooperative ownership of real estate, secured by the
assignment or transfer of certificates or other evidence of
ownership of the borrower.
(5) Through the purchase of loans that, at the time of
purchase, the savings bank could make in accordance with this
Section and the bylaws.
(6) Through the purchase of installment contracts for
the sale of real estate and title thereto that is subject to
the contracts, but in each instance only if the savings bank,
at the time of purchase, could make a mortgage loan of the
same amount and for the same length of time on the security
of the real estate.
(7) Through loans guaranteed or insured, wholly or in
part, by the United States or any of its instrumentalities.
(8) Subject to regulations adopted by the Commissioner,
through secured or unsecured loans for business, corporate,
commercial, or agricultural purposes; provided that the total
of all loans granted under this paragraph shall not exceed
15% of the savings bank's total assets unless a greater
amount is authorized in writing by the Commissioner.
(9) For the purpose of mobile home financing subject,
however, to the regulation of the Commissioner.
(10) Through loans secured by the cash surrender value
of any life insurance policy or any collateral that would be
a legal investment under the terms of this Act if made by the
savings bank.
(11) Any provision of this Act or any other law, except
for paragraph (18) of Section 6003, to the contrary
notwithstanding, but subject to the Financial Institutions
Insurance Sales Law and subject to the Commissioner's
regulations, any savings bank may make any loan or investment
or engage in any activity that it could make or engage in if
it were organized under State law as a savings and loan
association or under federal law as a federal savings and
loan association or federal savings bank.
(12) A savings bank may issue letters of credit or other
similar arrangements only as provided for by regulation of
the Commissioner with regard to aggregate amounts permitted,
take out commitments for stand-by letters of credit,
underlying documentation and underwriting, legal limitations
on loans of the savings bank, control and subsidiary records,
and other procedures deemed necessary by the Commissioner.
(13) For the purpose of automobile financing, subject to
the regulation of the Commissioner.
(14) For the purpose of financing primary, secondary,
undergraduate, or postgraduate education.
(15) Through revolving lines of credit on the security
of a first or junior lien on the borrower's personal
residence, based primarily on the borrower's equity, the
proceeds of which may be used for any purpose; those loans
being commonly referred to as home equity loans.
(16) As secured or unsecured credit to cover the payment
of checks, drafts, or other funds transfer orders in excess
of the available balance of an account on which they are
drawn, subject to the regulations of the Commissioner.
(Source: P.A. 90-301, eff. 8-1-97.)
(205 ILCS 205/8016) (from Ch. 17, par. 7308-16)
Sec. 8016. Procedure for conversion from a savings bank
charter.
(a) Any savings bank operating under this Act may
convert to any other depository institution chartered become
a State savings and loan association or State bank under
Illinois charter or a federal association under the laws and
regulations of this State or under the laws and regulations
of the United States in accordance with the following
requirements procedure:
(1) The converting savings bank shall notify the
Commissioner of its intent to convert. Notice should be
submitted when the savings bank first submits a request to
convert to the appropriate State or federal authorities, but
in no case less than 30 days before the conversion. Approval
of the conversion by the Commissioner shall not be required
except when the savings bank converts to a depository
institution that is also chartered by the Commissioner in
which case the savings bank shall comply with State law and
regulations applicable to the conversion to such depository
institution.
(2)(1) The board of directors shall approve a plan of
conversion by resolution adopted by majority vote of all of
the directors. The plan shall set forth, among other terms,
the following:
(A) a financial statement of the savings bank as of
the last business day of the month preceding the adoption
of the plan;
(B) the disposition of deposit accounts and capital
stock, if any;
(C) adjustments, if any, in the value of the
deposit accounts when exchanged for comparable accounts
in the converted institution;
(D) the disposition of any obligations or
liabilities; and
(E) any other information that may be required by
the Commissioner.
(2) The plan shall not be submitted to the members until
approved by the Commissioner.
(3) The Commissioner may approve the plan; or if the
Commissioner disapproves the plan, he shall state his
objections in writing and give the converting savings bank an
opportunity to amend the plan to obviate the objections.
Approval shall be given if the Commissioner finds that the
plan meets the requirements of this Act and the plan is
equitable and protects the rights of all persons affected,
including contingent interests as theretofore may have been
created in the retained earnings, if any.
(4) After receipt of approval from the Commissioner, the
plan of conversion shall be mailed to each member and may be
submitted to a vote at an annual or special meeting of the
members.
(3) Upon notice prescribed by subsection (a) of Section
4003 of this Act, the plan of conversion shall be adopted
upon receiving in the affirmative two-thirds or more of the
total number of votes that all members of the savings bank
are entitled to cast. A report of proceedings at the
meeting, certified by the president or a vice president and
attested by the secretary, shall be filed promptly with the
Commissioner.
(4) The savings bank shall pay all accrued supervisory
fees and other fees and assessments under this Act as of the
date of conversion.
(5) Upon completion of the conversion, the charter of
the savings bank shall automatically terminate and the
savings bank charter or a true copy of the charter shall be
returned to the Commissioner.
(b) If the Commissioner finds that any requirement of
this Section would prevent under applicable law a depository
institution that is not a savings bank from converting to a
savings bank, the Commissioner may waive any requirement
having that effect. Within 90 days after the date of the
meeting, the savings bank shall take the action prescribed
and authorized by the laws and regulations of the State of
Illinois or the United States to complete its conversion to a
State association, State bank or federal association.
(6) Upon receipt of a State or federal charter, the
savings bank shall file promptly with the Commissioner either
a copy of the charter or a certificate of the appropriate
State or federal officer setting forth the facts concerning
the issuance of the charter; and upon recording the charter
in the same manner as the savings bank's articles of
incorporation, the savings bank shall cease to be a savings
bank operating under the Act.
(Source: P.A. 89-567, eff. 7-26-96.)
(205 ILCS 205/9009) (from Ch. 17, par. 7309-9)
Sec. 9009. Orders of the Commissioner.
(a) If the affairs of the savings bank, savings bank
subsidiary or affiliate, or savings bank holding company are
not being conducted in accordance with this Act, the
Commissioner shall require the directors, officers, and
employees to take any necessary corrective action. If the
necessary corrective action is not taken, the Commissioner
may issue a formal order to the directors of the savings
bank, subsidiary, affiliate, or holding company, to be
delivered either personally or by registered or certified
mail, specifying a date, which may be immediate or may be a
later date, for the performance of the corrective action by
the savings bank, subsidiary, affiliate, or holding company.
The order or any part thereof shall be subject to Section
11006 of this Act.
(b) If the formal order of the Commissioner, in whole or
in part, contains a finding that the business of the savings
bank or holding company is being conducted in a fraudulent,
illegal, unsafe, or unsound manner or that the violation
thereof or the continuance by the savings bank or holding
company of the practice to be corrected could cause
insolvency, substantial dissipation of assets or earnings, or
the impairment of its capital, the order or part thereof
shall be complied with immediately on or before the effective
date thereof until modified or withdrawn by the Commissioner
or modified or terminated by a circuit court. The
Commissioner may apply to the circuit court of the county in
which the savings bank or holding company is located for
enforcement of an order requiring prompt compliance.
(c) If the order, or part thereof, is not subject to
subsection (b) and if no hearing pursuant to Section 9018 of
this Act has been requested within 5 days of the effective
date of the order, the Commissioner may, at any time within
90 days after the effective date of the order, institute suit
in the circuit court of Sangamon County or the circuit court
of the county in which the savings bank or holding company is
located to compel the directors, officers, or employees to
take the required corrective action. The court, after due
process of law, shall adjudicate the question, enter the
proper order or orders, and enforce them.
(d) No provision of this Section shall interfere with
the exercise by the Commissioner of any provision of Article
11.
(Source: P.A. 86-1213.)
(205 ILCS 205/11005) (from Ch. 17, par. 7311-5)
Sec. 11005. Institution affiliated party. As used in
this Act, the term "institution affiliated party" shall mean
a director, officer, employee, agent, or controlling
stockholder of a savings bank operating under this Act; a
person who has filed or is required to file a
change-in-control notice with the Commissioner; any person
subject to an order of or a party to an agreement with the
Commissioner pertaining to a savings bank; a shareholder of,
consultant to, joint venture partner of, or an independent
contractor for (including accountants, appraisers and
attorneys) any other person who participates in a significant
way in the affairs of a savings bank operating under this
Act.
(Source: P.A. 86-1213.)
(205 ILCS 205/11008) (from Ch. 17, par. 7311-8)
Sec. 11008. Unauthorized participation by convicted
individual.
(a) Except with the prior written consent of the
Commissioner, no person who has been convicted of any
criminal offense involving dishonesty or a breach of trust
may own or control directly or indirectly more than 0.001% of
the capital stock of, receive benefit directly or indirectly
from, or participate, directly or indirectly, in any manner
in the conduct of the affairs of a savings bank.
(b) A savings bank may not permit participation by a
person described in subsection (a).
(c) Whoever knowingly violates subsection (a) or (b) is
guilty of a Class 3 felony and may be fined not more than
$10,000 for each day of violation.
(Source: P.A. 86-1213.)
Section 15. The Corporate Fiduciary Act is amended by
changing Sections 1-3, 1-5.07, 1-5.08, 1-6, 3-3, 4-1, and 4-4
as follows:
(205 ILCS 620/1-3) (from Ch. 17, par. 1551-3)
Sec. 1-3. Scope of Act; application to national banks,
federally chartered savings and loan associations or
federally chartered savings banks. After January 1, 1988, no
national bank chartered by the Comptroller of the Currency
and having its main office in Illinois or federal savings and
loan association or federal savings bank chartered by the
Federal Home Loan Bank Board and having its main office in
Illinois shall be required to obtain a certificate of
authority under this Act or in any manner submit to the
regulation or supervision pursuant to this Act, but such
national bank, federal savings and loan association or
federal savings bank shall only be required to obtain the
authority to accept and execute trusts from the particular
federal agency which granted its charter, to be exempt from
the provisions of this Act. Nothing in this Section 1-3 shall
exempt national banks, federal savings and loan associations
or federal savings banks whose main offices are located
outside of Illinois from compliance with the provisions of
Article IV of this Act.
On January 1, 1988, any certificate of authority which
has been issued under the provisions of this Act to a
national bank, federally chartered savings and loan
association or federally chartered savings bank in Illinois
shall expire and be of no further force and effect and upon
the request of the Commissioner, shall be surrendered.
After January 1, 1988, a any State bank that which has a
certificate of authority under this Act and which proposes to
convert to a national bank and or a State chartered savings
and loan association and a State chartered savings bank that
has a certificate of authority under this Act and which
proposes to convert to a federally chartered savings and loan
association or federally chartered savings bank, shall notify
the Commissioner of such fact and upon obtaining its charter
from the relevant federal regulator, shall surrender its
certificate of authority issued pursuant to this Act.
(Source: P.A. 86-754.)
(205 ILCS 620/1-5.07) (from Ch. 17, par. 1551-5.07)
Sec. 1-5.07. "Depository institution" includes banks,
savings and loan associations, savings banks, and credit
unions.
(Source: P.A. 85-858.)
(205 ILCS 620/1-5.08) (from Ch. 17, par. 1551-5.08)
Sec. 1-5.08. "Foreign corporation" means:
(a) any bank, savings and loan association, savings
bank, or other corporation now or hereafter organized under
the laws of any state or territory of the United States of
America, including the District of Columbia, other than the
State of Illinois;
(b) any national banking association having its
principal place of business in any state or territory of the
United States of America, including the District of Columbia,
other than the State of Illinois; and
(c) any federal savings and loan association or federal
savings bank having its principal place of business in any
state or territory of the United States of America, including
the District of Columbia, other than the State of Illinois.
(Source: P.A. 85-858.)
(205 ILCS 620/1-6) (from Ch. 17, par. 1551-6)
Sec. 1-6. General Corporate Powers. A corporate
fiduciary shall have the powers:
(a) if it is a State bank, those powers granted
under Sections 3 and 5 of the Illinois Banking Act, as
now or hereafter amended; and
(b) if it is a State savings and loan association,
those powers granted under Sections 1-6 through 1-8 of
the Illinois Savings and Loan Act of 1985, as now or
hereafter amended; and
(c) if it is a State savings bank, those powers
granted under the Savings Bank Act; and
(d)(c) if it is a corporation organized under the
Business Corporation Act of 1983, as now or hereafter
amended, or a limited liability company organized under
the Limited Liability Company Act, those powers granted
in Sections 4.01 through 4.24 of the Trusts and Trustees
Act, as now or hereafter amended, to the extent the
exercise of such powers by the corporate fiduciary are
not contrary to the instrument containing the appointment
of the corporate fiduciary, the court order appointing
the corporate fiduciary or any other statute specifically
limiting the power of the corporate fiduciary under the
circumstances; and
(e)(d) subject to Article XLIV of the Illinois
Insurance Code, to act as the agent for any fire, life,
or other insurance company authorized by the State of
Illinois, by soliciting and selling insurance and
collecting premiums on policies issued by such company;
and may receive for services so rendered such fees or
commissions as may be agreed upon between the said
corporate fiduciary and the insurance company for which
it may act as agent; provided, however, that no such
corporate fiduciary shall in any case assume or guarantee
the payment of any premium on insurance policies issued
through its agency by its principal; and provided
further, that the corporate fiduciary shall not guarantee
the truth of any statement made by an assured in filing
his application for insurance.
The Commissioner may specify powers of corporate
fiduciaries generally or of a particular corporate fiduciary
and by rule or order limit or restrict such powers of
corporate fiduciaries or a particular corporate fiduciary if
he finds the exercise of such power by corporate fiduciaries
generally or of the corporate fiduciary in particular may
tend to be an unsafe or unsound practice, or if such power is
otherwise not in the interest of beneficiaries of any
fiduciary appointment.
(Source: P.A. 90-41, eff. 10-1-97; 90-424, eff. 1-1-98;
90-655, eff. 7-30-98.)
(205 ILCS 620/3-3) (from Ch. 17, par. 1553-3)
Sec. 3-3. Successor trustee.
(a) If any corporate fiduciary merges into, or becomes
consolidated with, another corporate fiduciary qualified to
administer trusts or is succeeded in its trust business by
any corporate fiduciary by purchase or otherwise; or if a
bank holding company causes a subsidiary, qualified to
administer trusts, to succeed to part or all of the trust
business of any other subsidiary of the same bank holding
company, the surviving, consolidated, successor corporate
fiduciary or subsidiary shall become successor fiduciary in
place of such predecessor corporate fiduciary, unless
expressly prohibited by the provisions of the trust
instrument, with all the rights, powers and duties which were
granted to or imposed on such predecessor corporate
fiduciary.
(b) (Blank).
(c) Notwithstanding any other provision of law, a
corporate fiduciary may delegate to any of its affiliates
qualified to administer trusts any or all fiduciary duties,
actions or decisions, discretionary or otherwise, and the
delegating corporate fiduciary shall not be required to
review any delegated actions or decisions taken by the
affiliate. The term "affiliate" means any state bank, any
state savings bank, any state savings and loan association,
any national bank, any trust company, or any other
corporation, which is qualified to act as a fiduciary in this
or any other state and which is a member of the same
affiliated group (within the meaning of Section 1504 of the
Internal Revenue Code of 1986, as amended).
(Source: P.A. 89-205, eff. 1-1-96; 89-364, eff. 8-18-95;
89-567, eff. 7-26-96; 89-686, eff. 6-1-97; 90-14, eff.
7-1-97.)
(205 ILCS 620/4-1) (from Ch. 17, par. 1554-1)
Sec. 4-1. Foreign corporate fiduciary; certificate of
authority. After July 13, 1953, no foreign corporation,
including banks, savings banks, and savings and loan
associations, now or hereafter organized under the laws of
any other state or territory, and no national banking
association having its principal place of business in any
other state or territory or federal savings and loan
association or federal savings bank having its principal
place of business in any other state or territory, may
procure a certificate of authority under Article II of this
Act and any certificate of authority heretofore issued
hereunder to any such foreign corporation or to any such
national banking association shall become null and void on
July 13, 1953, except that any such foreign corporation or
any such national banking association actually acting as
trustee, executor, administrator, administrator to collect,
guardian, or in any other like fiduciary capacity in this
State on July 13, 1953, may continue to act as such fiduciary
in that particular trust or estate until such time as it has
completed its duties thereunder. Such foreign corporation
and such national banking association shall be subject to the
provisions in this Article IV, regardless of whether its
certificate of authority was obtained before July 13, 1953.
The right and eligibility of any foreign corporation, any
national banking association having its principal place of
business in any other state or territory or any federal
savings and loan association or federal savings bank having
its principal place of business in any other state or
territory hereafter to act as trustee, executor,
administrator, administrator to collect, guardian, or in any
other like fiduciary capacity in this State shall be governed
solely by the provisions of this Act. Provided, however,
that the Commissioner shall not be required to conduct an
annual examination of such foreign corporation pursuant to
Section 5-2 of this Act, but may examine such foreign
corporation as the Commissioner deems appropriate.
"Principal place of business" of any bank, federal savings
and loan association or savings bank, for purposes of this
Article IV, means the principal office as designated on the
charter by its principal regulator.
(Source: P.A. 89-364, eff. 8-18-95.)
(205 ILCS 620/4-4) (from Ch. 17, par. 1554-4)
Sec. 4-4. Place of business not to be established in
State; not deemed transacting business.
(a) A foreign corporation, as defined in Section 1-5.08
of this Act, shall not establish in this State a place of
business, branch office, or agency for the conduct of
business as a fiduciary and because it is not permitted to
establish in this State a place of business, branch office or
agency, a foreign corporation insofar as it acts in a
fiduciary capacity in this State pursuant to the provisions
of this Act shall not be deemed to be transacting business in
this State. The foreign corporation may apply for, and
procure from the Commissioner, a license to establish a
representative office pursuant to the Foreign Bank
Representative Office Act.
(b) Notwithstanding subsection (a) of this Section 4-4,
after May 31, 1997, a branch of an out-of-state bank, as
defined in Section 2 of the Illinois Banking Act, and a
foreign association, as defined in Section 1-10.31 of the
Illinois Savings and Loan Act of 1985, may establish an
office in this State for the conduct of business as a
fiduciary, provided: (i) fiduciary business conducted in this
State by a branch of an out-of-state bank is subject to
examination by the Commissioner; and (ii) the trust
activities of the branch of the out-of-state bank are subject
to regulation, including enforcement actions, by the
Commissioner to the same extent as Illinois corporate
fiduciaries.
(Source: P.A. 89-208, eff. 9-29-95; 89-364, eff. 8-18-95;
89-626, eff. 8-9-96; 90-665, eff. 7-30-98.)
Section 99. Effective date. This Act takes effect upon
becoming law.
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