State of Illinois
92nd General Assembly
Legislation

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92_HB5822

 
                                               LRB9214924JSpc

 1        AN ACT concerning bank holding companies.

 2        Be  it  enacted  by  the People of the State of Illinois,
 3    represented in the General Assembly:

 4        Section 5.  The Illinois Bank Holding Company Act of 1957
 5    is amended by changing Section 2 as follows:

 6        (205 ILCS 10/2) (from Ch. 17, par. 2502)
 7        Sec.  2.  Definitions.   Unless  the   context   requires
 8    otherwise:
 9        (a)  "Bank" means any national banking association or any
10    bank,  banking association or savings bank, whether organized
11    under the laws of Illinois, another state, the United States,
12    the District of Columbia, any territory of the United States,
13    Puerto Rico, Guam, American  Samoa  or  the  Virgin  Islands,
14    which  (1)  accepts  deposits  that the depositor has a legal
15    right to withdraw on demand  by  check  or  other  negotiable
16    order  and  (2)  engages in the business of making commercial
17    loans.  "Bank" does not include  any  organization  operating
18    under  Sections  25  or 25 (a) of the Federal Reserve Act, or
19    any organization which does not do business within the United
20    States except as an incident to its  activities  outside  the
21    United States or any foreign bank.
22        (b)  "Bank   holding  company"  means  any  company  that
23    controls or has control over any bank  or  over  any  company
24    that  is  or becomes a bank holding company by virtue of this
25    Act.
26        (c)  "Banking office" means the  principal  office  of  a
27    bank,  any  branch  of a bank, or any other office at which a
28    bank  accepts  deposits,  provided,  however,  that  "banking
29    office" shall not mean:
30             (1)  unmanned automatic teller  machines,  point  of
31        sale  terminals  or  other  similar  unmanned  electronic
 
                            -2-                LRB9214924JSpc
 1        banking facilities at which deposits may be accepted; or
 2             (2)  offices located outside the United States.
 3        (d)  "Cause to be chartered", with respect to a specified
 4    bank,  means the acquisition of control of such bank prior to
 5    the time it commences to engage in the banking business.
 6        (e)  "Commissioner" means the Commissioner of  Banks  and
 7    Real  Estate  or a person authorized by the Commissioner, the
 8    Office of Banks and Real Estate Act, or this Act  to  act  in
 9    the Commissioner's stead.
10        (f)  "Community"  means the contiguous area served by the
11    banking offices of  a  bank,  but  need  not  be  limited  or
12    expanded  to conform to the geographic boundaries of units of
13    local government.
14        (g)  "Company" means  any  corporation,  business  trust,
15    voting   trust,   association,  partnership,  joint  venture,
16    similar organization or any other trust unless by  its  terms
17    it  must terminate within 25 years or not later than 21 years
18    and 10 months after the death of individuals  living  on  the
19    effective  date  of  the  trust, but shall not include (1) an
20    individual or (2) any corporation the majority of the  shares
21    of  which  are  owned by the United States or by any state or
22    any  corporation  or  community  chest  fund,  organized  and
23    operated exclusively for religious,  charitable,  scientific,
24    literary or educational purposes, no part of the net earnings
25    of  which  inure to the benefit of any private shareholder or
26    individual and no substantial part of the activities of which
27    is  carrying  on  propaganda  or  otherwise   attempting   to
28    influence legislation.
29        (h)  A  company  "controls or has control over" a bank or
30    company if (1) it directly or indirectly owns or controls  or
31    has  the  power  to vote, 25% or more of the voting shares of
32    any class of voting securities of such bank or company or (2)
33    it controls in any manner the election of a majority  of  the
34    directors  or  trustees  of  such  bank  or  company or (3) a
 
                            -3-                LRB9214924JSpc
 1    trustee holds for the benefit of its shareholders, members or
 2    employees, 25% or more of the voting shares of such  bank  or
 3    company   or  (4)  it  directly  or  indirectly  exercises  a
 4    controlling influence over the management or policies of such
 5    bank or company that is a bank holding company and the  Board
 6    of  Governors of the Federal Reserve System has so determined
 7    under the federal Bank Holding Company Act.   In  determining
 8    whether  any  company  controls or has control over a bank or
 9    company:  (i) shares owned or controlled by any subsidiary of
10    a  company  shall  be  deemed  to  be  indirectly  owned   or
11    controlled  by  such company; (ii) shares held or controlled,
12    directly or indirectly, by a  trustee  or  trustees  for  the
13    benefit  of  a  company,  the  shareholders  or  members of a
14    company or the employees (whether exclusively or  not)  of  a
15    company,  shall  be  deemed to be controlled by such company;
16    and (iii) shares transferred, directly or indirectly, by  any
17    bank  holding  company (or by any company which, but for such
18    transfer, would be a bank holding company) to any  transferee
19    that  is  indebted  to the transferor or that has one or more
20    officers, directors, trustees or beneficiaries in common with
21    or subject to control by the transferor, shall be  deemed  to
22    be  indirectly  owned  or controlled by the transferor unless
23    the Board of Governors of  the  Federal  Reserve  System  has
24    determined,  under the federal Bank Holding Company Act, that
25    the transferor is not in  fact  capable  of  controlling  the
26    transferee.   Notwithstanding the foregoing, no company shall
27    be deemed to have control of or over a bank or  bank  holding
28    company  (A)  by virtue of its ownership or control of shares
29    in a fiduciary capacity arising in the ordinary course of its
30    business; (B) by virtue of its ownership or control of shares
31    acquired  by  it  in  connection  with  its  underwriting  of
32    securities which are held only for such  period  of  time  as
33    will  permit the sale thereof upon a reasonable basis; (C) by
34    virtue of its holding any shares as collateral taken  in  the
 
                            -4-                LRB9214924JSpc
 1    ordinary  course  of securing a debt or other obligation; (D)
 2    by virtue of its ownership or control of shares  acquired  in
 3    the  ordinary course of collecting a debt or other obligation
 4    previously contracted in good faith, until 5 years after  the
 5    date  acquired;  or  (E)  by virtue of its voting rights with
 6    respect to  shares  of  any  bank  or  bank  holding  company
 7    acquired in the course of a proxy solicitation in the case of
 8    a  company  formed  and  operated  for  the  sole  purpose of
 9    participating in a proxy solicitation.
10                  (i)  "Federal Bank Holding Company  Act"  means
11             the federal Bank Holding Company Act of 1956, as now
12             or hereafter amended.
13        (j)  "Foreign bank" means any company organized under the
14    laws  of  a  foreign country which engages in the business of
15    banking or any subsidiary or affiliate of any  such  company,
16    organized  under such laws.  "Foreign bank" includes, without
17    limitation,  foreign  merchant  banks   and   other   foreign
18    institutions  that  engage  in  banking  activities  usual in
19    connection with the business  of  banking  in  the  countries
20    where such foreign institutions are organized or operating.
21        (k)  "Home  state" means the home state of a foreign bank
22    as determined pursuant to the federal  International  Banking
23    Act of 1978.
24        (l)  "Illinois bank" means a bank:
25             (1)  that  is organized under the laws of this State
26        or of the United States; and
27             (2)  whose  main  banking  premises  is  located  in
28        Illinois.
29        (m)  "Illinois bank holding company" means a bank holding
30    company:
31             (1)  whose principal place of business is  Illinois;
32        and
33             (2)  that  is  not directly or indirectly controlled
34        by another bank holding company whose principal place  of
 
                            -5-                LRB9214924JSpc
 1        business  is  a state other than Illinois or by a foreign
 2        bank whose Home State is a state other than Illinois.
 3        An out  of  state  bank  holding  company  that  acquires
 4    control  of  one  or  more  Illinois  banks  or Illinois bank
 5    holding companies pursuant to Sections 3.061 or  3.071  shall
 6    not be deemed an Illinois bank holding company.
 7        (n)  "Main  banking  premises" means the location that is
 8    designated in a bank's charter as its main office and that is
 9    within the state in which the total deposits held by  all  of
10    the banking offices of such bank are the largest, as shown in
11    the most recent reports of condition or similar reports filed
12    by such bank with state or federal regulatory authorities.
13        (o)  "Out of state bank" means a bank:
14             (1)  that is not an Illinois bank; and
15             (2)  whose  main  banking  premises  is located in a
16        state other than Illinois.
17        (p)  "Out of state bank holding  company"  means  a  bank
18    holding company:
19             (1)  that is not an Illinois bank holding company;
20             (2)  whose  principal  place  of business is a state
21        other than Illinois the laws of which expressly authorize
22        the acquisition by an Illinois bank holding company of  a
23        bank   or  bank  holding  company  in  that  state  under
24        qualifications  and  conditions  which  are  not   unduly
25        restrictive,  as  determined  by  the  Commissioner, when
26        compared to those imposed by the laws of Illinois.
27        (q)  "Principal place of business" means, with respect to
28    a bank holding company, the state in which the total deposits
29    held by all of  the  banking  offices  of  all  of  the  bank
30    subsidiaries of such bank holding company are the largest, as
31    shown  in  the  most  recent  reports of condition or similar
32    reports filed by the bank holding company's bank subsidiaries
33    with state or federal regulatory authorities.
34        (r)  "State" or "states" when used in this Act means  any
 
                            -6-                LRB9214924JSpc
 1    State  of  the  United  States, the District of Columbia, any
 2    territory of the United States, Puerto Rico,  Guam,  American
 3    Samoa or the Virgin Islands.
 4        (s)  "Subsidiary",  with  respect  to  a  specified  bank
 5    holding company, means any bank or company controlled by such
 6    bank holding company.
 7    (Source: P.A. 89-508, eff. 7-3-96.)

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