093_SB1500 LRB093 06427 JLS 06550 b 1 AN ACT concerning certain financial institutions. 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 5 changing Section 37 as follows: 6 (205 ILCS 5/37) (from Ch. 17, par. 347) 7 Sec. 37. Loans to officers and loans on and purchases of 8 bank's own stock. 9 (1) No state bank shall make any loan or extension of 10 credit in excess of the limits, as determined by the 11 Commissioner, at any one time outstanding each to its 12 president, or to any of its vice presidents or its salaried 13 officers or employees or directors or to corporations or 14 firms, controlled by them, or in the management of which any 15 of them are actively engaged, unless such loan or extension 16 of credit shall have been first approved, by the board of 17 directors. The Commissioner shall prescribe such limits by 18 rules. 19 (2) It shall not be lawful for a state bank to make any 20 loan or discount on the security of the shares of its own 21 capital stock or preferred stock or on the security of its 22 own debentures or evidences of debt which are either 23 convertible into capital stock or are junior or subordinate 24 in right of payment to deposit or other liabilities of the 25 bank; provided, however, that a state bank may acquire or 26 hold such shares or securities as authorized by Section 14 of 27 this Act. 28 (3)(a) For purposes of this Section, "control" means (i) 29 ownership, control, or power to vote 25% or more of the 30 outstanding shares of any class of voting security of the 31 corporation or firm, directly or indirectly, or acting -2- LRB093 06427 JLS 06550 b 1 through or in concert with one or more other persons; (ii) 2 control in any manner over the election of a majority of the 3 directors of the corporation or firm; or (iii) the power to 4 exercise a controlling influence over the management or 5 policies of the corporation or firm, directly or indirectly, 6 or acting through or in concert with one or more persons. 7 (3)(b) A person does not have the power to exercise a 8 controlling influence over the management or policies of a 9 corporation or firm solely by virtue of the person's position 10 as an officer or director of the corporation or firm. 11 (3)(c) A person is presumed to have control, including 12 the power to exercise a controlling influence over the 13 management or policies, of a corporation or firm if: 14 (i) the person: 15 (A) is an executive officer, director, or 16 individual exercising similar functions of the 17 corporation or firm; and 18 (B) directly or indirectly owns, controls, or 19 has the power to vote more than 10% of any class of 20 voting securities of the corporation or firm; or 21 (ii) (A) the person directly or indirectly owns, 22 controls, or has the power to vote more than 10% of 23 any class of voting securities of the corporation or 24 firm; and 25 (B) no other person directly or indirectly 26 owns, controls, or has the power to vote a greater 27 percentage of that class of voting securities. 28 (3)(d) A person may rebut a presumption established 29 under subdivision (3)(c) of this Section by submitting 30 written materials that, in the Commissioner's judgment, 31 demonstrate an absence of control. 32 (Source: P.A. 92-483, eff. 8-23-01.) 33 Section 99. Effective date. This Act takes effect upon -3- LRB093 06427 JLS 06550 b 1 becoming law.