SB2634 Engrossed

LRB093 18195 SAS 43890 b






1
    AN ACT concerning financial 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 adding 
5
Section 84 as follows:
 
6
    (205 ILCS 5/84  new)
7
    Sec. 84. Investments and participation by affiliates.

8
    (a) Any bank or trust company acting in its fiduciary 
9
capacity may purchase services or products, including, but not 
10
limited to, life insurance, equity derivatives, or securities 
11
underwritten or otherwise distributed by an affiliate of such 
12
bank or trust company or its affiliate directly from such 
13
affiliate or from a syndicate or selling group which includes 
14
the bank, trust company, or its affiliate, provided that the 
15
purchase is otherwise prudent and not prohibited by the 
16
instrument governing the fiduciary relationship. The 
17
provisions of this Section shall apply to such purchases of 
18
services or products made at the time of the initial offering 
19
thereof or at any time thereafter.
20
    (b) The compensation for the services or products may be in 
21
addition to the compensation to which the bank, trust company, 
22
or its affiliate is otherwise entitled as fiduciary.
23
    (c) Any bank or trust company acting in its fiduciary 
24
capacity may effect such purchases of services or products with 
25
or through its affiliate, provided that the fees paid to its 
26
affiliate and the terms and conditions of such purchases are 
27
reasonable and the transaction is not prohibited by the 
28
instrument governing the fiduciary relationship.
29
    (d) A bank or a trust company shall disclose at least 
30
annually any purchase authorized
by this Section that was made 
31
by the bank or trust company during the reporting period. The 
32
disclosure shall be given, in writing or electronically, to all 
 


 






SB2634 Engrossed
- 2 -
LRB093 18195 SAS 43890 b




1
persons entitled to receive statements of account activity, and 
2
shall include any capacities
in which the bank or trust company 
3
or an affiliate acts for the issuer of the securities or the 
4
provider of the products or services and the fact that the 
5
bank,
trust company or an affiliate may have an interest in the 
6
products or services.
7
    (e) Notwithstanding the applicable provisions of Illinois 
8
law, including Section 2 of this Act, the provisions of this 
9
Section apply to any bank or trust company doing banking or 
10
trust business in this State, including, without limiting the 
11
generality of the foregoing, any national bank, national trust 
12
company, or any of
its affiliates even if its principal place 
13
of business is not in this State.

 
14
    Section 99. Effective date. This Act takes effect January 
15
1, 2005.