State of Illinois
92nd General Assembly
Legislation

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92_HB5839

 
                                               LRB9214017JSpc

 1        AN ACT concerning 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 Savings and Loan Act of 1985  is
 5    amended by changing Section 7-19.1 as follows:

 6        (205 ILCS 105/7-19.1) (from Ch. 17, par. 3307-19.1)
 7        Sec.  7-19.1.  Savings and Residential Finance Regulatory
 8    Fund.
 9        (a)  The  aggregate  of  all  fees   collected   by   the
10    Commissioner  under  this  Act  shall  be paid promptly after
11    receipt of the same,  accompanied  by  a  detailed  statement
12    thereof,  into  the  State treasury and shall be set apart in
13    the  Savings  and  Residential  Finance  Regulatory  Fund,  a
14    special fund hereby  created  in  the  State  treasury.   The
15    amounts  deposited  into  the  Fund  shall  be  used  for the
16    ordinary and contingent expenses of the Office of  Banks  and
17    Real  Estate.   Nothing  in this Act shall prevent continuing
18    the  practice  of   paying   expenses   involving   salaries,
19    retirement,  social  security,  and  State-paid  insurance of
20    State officers by  appropriation  from  the  General  Revenue
21    Fund.
22        (b)  Moneys   in  the  Savings  and  Residential  Finance
23    Regulatory  Fund  may  not  be  appropriated,  assigned,   or
24    transferred  to  another  State fund.  The moneys in the Fund
25    shall be for the sole benefit of the institutions assessed.
26        (c)  All earnings received from investments of  funds  in
27    the  Savings and Residential Finance Regulatory Fund shall be
28    deposited into the Savings and Residential Finance Regulatory
29    Fund and may be used for the same purposes as fees  deposited
30    into that Fund.
31    (Source: P.A. 88-579, eff. 8-12-94; 89-508, eff. 7-3-96.)
 
                            -2-                LRB9214017JSpc
 1        Section  10.  The Savings Bank Act is amended by changing
 2    Section 6013 as follows:

 3        (205 ILCS 205/6013) (from Ch. 17, par. 7306-13)
 4        Sec. 6013. Loans to one borrower.
 5        (a)  Except as provided  in  subsection  (c),  the  total
 6    loans  and extensions of credit, both direct and indirect, by
 7    a  savings  bank  to  any  person,  other  than  a  municipal
 8    corporation for money borrowed, outstanding at one time shall
 9    not exceed 25% 20% of the savings bank's total  capital  plus
10    general loan loss reserves.
11        (b)  Except  as  provided  in  subsection  (c), the total
12    loans and extensions of credit, both direct and indirect,  by
13    a  savings  bank to any person outstanding at one time and at
14    least 100% secured by readily marketable collateral having  a
15    market  value,  as  determined  by  reliable and continuously
16    available price quotations,  shall  not  exceed  10%  of  the
17    savings bank's total capital plus general loan loss reserves.
18    This limitation shall be separate from and in addition to the
19    limitation contained in subsection (a).
20        (c)  If  the  limit  under subsection (a) or (b) on total
21    loans to one borrower is less than $500,000, a  savings  bank
22    that meets its minimum capital requirement under this Act may
23    have loan and extensions of credit, both direct and indirect,
24    outstanding to any person at one time not to exceed $500,000.
25    With  the  prior  written  approval  of  the  Commissioner, a
26    savings bank that has capital in excess of 6% of  assets  may
27    make  loans  and extensions of credit to one borrower for the
28    development of residential housing properties, located or  to
29    be  located  in  this State, not to exceed 30% of the savings
30    bank's total capital plus general loan loss reserves.
31        (d)  For purposes of  this  Section,  the  term  "person"
32    shall  be deemed to include an individual, firm, corporation,
33    business  trust,  partnership,  trust,  estate,  association,
 
                            -3-                LRB9214017JSpc
 1    joint  venture,   pool,   syndicate,   sole   proprietorship,
 2    unincorporated association, any political subdivision, or any
 3    similar entity or organization.
 4        (e)  For  the  purposes  of  this  Section  any  loan  or
 5    extension  of  credit  granted to one person, the proceeds of
 6    which are used for the direct benefit  of  a  second  person,
 7    shall  be  deemed a loan or extension of credit to the second
 8    person as well as the first person.  In addition, a  loan  or
 9    extension  of  credit to one person shall be deemed a loan or
10    extension of credit to others when a common enterprise exists
11    between the first person and such other persons.
12        (f)  For  the  purposes  of  this  Section,   the   total
13    liabilities of a firm, partnership, pool, syndicate, or joint
14    venture  shall  include the liabilities of the members of the
15    entity.
16        (g)  For the purposes of this Section, the term  "readily
17    marketable collateral" means financial instruments or bullion
18    that are salable under ordinary circumstances with reasonable
19    promptness  at  a  fair  market  value  on  an  auction  or a
20    similarly   available   daily   bid-and-ask   price   market.
21    "Financial  instruments"  include   stocks,   bonds,   notes,
22    debentures traded on a national exchange or over the counter,
23    commercial   paper,   negotiable   certificates  of  deposit,
24    bankers' acceptances, and shares in money  market  or  mutual
25    funds.
26        (h)  Each   savings   bank   shall   institute   adequate
27    procedures  to  ensure  that  collateral  fully  secures  the
28    outstanding loan or extension of credit at all times.
29        (i)  If   collateral   values  fall  below  100%  of  the
30    outstanding loan or extension of credit to  the  extent  that
31    the  loan  or extension of credit no longer is in conformance
32    with subsection (b) and exceeds the  25%  20%  limitation  of
33    subsection  (a),  the  loan  must be brought into conformance
34    with  this  Section  within  5  business  days  except  where
 
                            -4-                LRB9214017JSpc
 1    judicial   proceedings   or   other   similar   extraordinary
 2    occurrences prevent the savings bank from taking action.
 3        (j)  This Section shall not apply to loans or  extensions
 4    of  credit to the United States of America or its agencies or
 5    this State or its agencies or to  any  loan,  investment,  or
 6    extension  of  credit  made  pursuant to Section 6003 of this
 7    Act.
 8        (k)  This Section does not apply to  the  obligations  as
 9    endorser,  whether with or without recourse, or as guarantor,
10    whether  conditional  or  unconditional,  of  negotiable   or
11    nonnegotiable   installment  consumer  paper  of  the  person
12    transferring the same if the bank's files or the knowledge of
13    its officers of the financial  condition  of  each  maker  of
14    those obligations is reasonably adequate and if an officer of
15    the  bank,  designated  for  that  purpose  by  the  board of
16    directors of the bank, certifies that the  responsibility  of
17    each maker of the obligations has been evaluated and that the
18    bank  is relying primarily upon each maker for the payment of
19    the obligations.  The certification shall be in  writing  and
20    shall be retained as part of the records of the bank.
21        (l)  The  Commissioner  may  prescribe rules to carry out
22    the purposes of this  Section  and  to  establish  limits  or
23    requirements  other  than those specified in this Section for
24    particular types of loans and extensions of credit.
25    (Source: P.A. 92-483, eff. 8-23-01.)

26        Section 99.  Effective date.  This Act takes effect  upon
27    becoming law.

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