2023 Illinois Compiled Statutes › Chapter 205 - FINANCIAL REGULATION › 205 ILCS 10/ - Illinois Bank Holding Company Act of 1957.

(205 ILCS 10/1) (from Ch. 17, par. 2501)
Sec. 1. 
		
		It is held to be in the public interest that competition prevail in
the banking system, and that banking services be expanded, and to those
ends that bank holding companies be permitted to operate within this State,
but that the independence of unit banks be
protected.
(Source: P.A. 82-21.)
(205 ILCS 10/2)
Sec. 2. Unless the context requires otherwise:
(a) "Bank" means any national banking association or any bank, banking
association or savings bank, whether organized under the laws of Illinois,
another state, the United States, the District of Columbia, any territory of
the United States, Puerto Rico, Guam, American Samoa or the Virgin Islands,
which (1) accepts deposits that the depositor has a legal right to withdraw on
demand by check or other negotiable order and (2) engages in the business of
making commercial loans.  "Bank" does not include any organization operating
under Sections 25 or 25 (a) of the Federal Reserve Act, or any organization
which does not do business within the United States except as an incident to
its activities outside the United States or any foreign bank.
(b) "Bank holding company" means any company that controls or has control
over any bank or over any company that is or becomes a bank holding company by
virtue of this Act.
(c) "Banking office" means the principal office of a bank, any branch
of a bank, or any other office at which a bank accepts deposits, provided,
however, that "banking office" shall not mean:
(1) unmanned automatic teller machines, point of sale     terminals or other similar unmanned electronic banking facilities at which deposits may be accepted; or
(2) offices located outside the United States.
(d) "Cause to be chartered", with respect to a specified bank, means the
acquisition of control of such bank prior to the time it commences to
engage in the banking business.
(e) "Commissioner" means the Secretary of Financial and Professional Regulation
or a person authorized by the Secretary, the Division of Banking
Act, or this Act to act in the Secretary's stead, and, beginning on January 1, 2011 (the effective date of Public Act 96-1163), all references in this Act to the Commissioner of Banks and Real Estate are deemed, in appropriate contexts, to be references to the Secretary of Financial and Professional Regulation.
(f) "Community" means the contiguous area served by the banking offices
of a bank, but need not be limited or expanded to conform to the geographic
boundaries of units of local government.
(g) "Company" means any corporation, business trust, voting trust,
association, partnership, joint venture, similar organization or any other
trust unless by its terms it must terminate within 25 years or not later
than 21 years and 10 months after the death of individuals living on the
effective date of the trust, but shall not include (1) an individual or (2)
any corporation the majority of the shares of which are owned by the United
States or by any state or any corporation or community chest fund,
organized and operated exclusively for religious, charitable, scientific,
literary or educational purposes, no part of the net earnings of which
inure to the benefit of any private shareholder or individual and no
substantial part of the activities of which is carrying on propaganda or
otherwise attempting to influence legislation.
(h) A company "controls or has control over" a bank or company if (1) it
directly or indirectly owns or controls or has the power to vote, 25% or
more of the voting shares of any class of voting securities of such bank or
company or (2) it controls in any manner the election of a majority of the
directors or trustees of such bank or company or (3) a trustee holds for
the benefit of its shareholders, members or employees, 25% or more of the
voting shares of such bank or company or (4) it directly or indirectly
exercises a controlling influence over the management or policies of such
bank or company that is a bank holding company and the Board of Governors
of the Federal Reserve System has so determined under the federal Bank
Holding Company Act.  In determining whether any company controls or has
control over a bank or company:  (i) shares owned or controlled by any
subsidiary of a company shall be deemed to be indirectly owned or
controlled by such company; (ii) shares held or controlled, directly or
indirectly, by a trustee or trustees for the benefit of a company, the
shareholders or members of a company or the employees (whether exclusively
or not) of a company, shall be deemed to be controlled by such company; and
(iii) shares transferred, directly or indirectly, by any bank holding
company (or by any company which, but for such transfer, would be a bank
holding company) to any transferee that is indebted
to the transferor or that has one or more officers, directors, trustees or
beneficiaries in common with or subject to control by the transferor, shall
be deemed to be indirectly owned or controlled by the transferor unless
the Board of Governors of the Federal Reserve System has determined, under
the federal Bank Holding Company Act, that the transferor is not in fact
capable of controlling the transferee.  Notwithstanding the foregoing, no
company shall be deemed to have control of or over a bank or bank holding
company (A) by virtue of its ownership or control of shares in a fiduciary
capacity arising in the ordinary course of its business; (B) by virtue of
its ownership or control of shares acquired by it in connection with its
underwriting of securities which are held only for such period of time as
will permit the sale thereof upon a reasonable basis; (C) by virtue of its
holding any shares as collateral taken in the ordinary course of securing a
debt or other obligation; (D) by virtue of its ownership or control of shares
acquired in the ordinary course of collecting a debt or other obligation
previously contracted in good faith, until 5 years after the date acquired; or
(E) by virtue of its voting rights with respect to shares of any bank or bank
holding company acquired in the course of a proxy solicitation in the case of a
company formed and operated for the sole purpose of participating in a proxy
solicitation.
(h-5) "Division" means the Division of Banking within the Department of Financial and Professional Regulation.
(h-10) "Division of Banking" means the Division of Banking of the Department of Financial and Professional Regulation.
(i) "Federal Bank Holding Company Act" means the federal Bank Holding
Company Act of 1956, as now or hereafter amended.
(j) "Foreign bank" means any company organized under the laws of a
foreign country which engages in the business of banking or any subsidiary
or affiliate of any such company, organized under such laws.  "Foreign
bank" includes, without limitation, foreign merchant banks and other
foreign institutions that engage in banking activities usual in connection
with the business of banking in the countries where such foreign
institutions are organized or operating.
(k) "Home state" means the home state of a foreign bank as determined
pursuant to the federal International Banking Act of 1978.
(l) "Illinois bank" means a bank:
(1) that is organized under the laws of this State or     of the United States; and
(2) whose main banking premises is located in     Illinois.
(m) "Illinois bank holding company" means a bank holding company:
(1) whose principal place of business is Illinois; and
(2) that is not directly or indirectly controlled by     another bank holding company whose principal place of business is a state other than Illinois or by a foreign bank whose Home State is a state other than Illinois.
An out of state bank holding company that acquires
control of one or more
Illinois banks or Illinois bank holding companies pursuant to Sections
3.061 or 3.071 shall not be deemed an Illinois bank holding company.
(n) "Main banking premises" means the location that is designated in a
bank's charter as its main office and that is within the state in which the
total deposits held by all of the banking offices of such bank are the
largest, as shown in the most recent reports of condition or similar
reports filed by such bank with state or federal regulatory authorities.
(o) "Out of state bank" means a bank:
(1) that is not an Illinois bank; and
(2) whose main banking premises is located in a state     other than Illinois.
(p) "Out of state bank holding company" means a
bank holding company:
(1) that is not an Illinois bank holding company;
(2) whose principal place of business is a state     other than Illinois the laws of which expressly authorize the acquisition by an Illinois bank holding company of a bank or bank holding company in that state under qualifications and conditions which are not unduly restrictive, as determined by the Secretary, when compared to those imposed by the laws of Illinois.
(q) "Principal place of business" means,
with respect to a bank holding company, the state in which the total
deposits held by all of the banking offices of all of the bank subsidiaries
of such bank holding company are the largest, as shown in the most recent
reports of condition or similar reports filed by the bank holding company's
bank subsidiaries with state or federal regulatory authorities.
(q-5) "Secretary" means the Secretary of Financial and Professional Regulation, or a person authorized by the Secretary or by this Act to act in the Secretary's stead.
(r) "State" or "states" when used in this Act means any State of the
United States, the District of Columbia, any territory of the United
States, Puerto Rico, Guam, American Samoa or the Virgin Islands.
(s) "Subsidiary", with respect to a specified bank holding company,
means any bank or company controlled by such bank holding company.
(Source: P.A. 96-1163, eff. 1-1-11; 96-1365, eff. 7-28-10; 97-333, eff. 8-12-11.)
(205 ILCS 10/3.02) (from Ch. 17, par. 2505)
Sec. 3.02. 
		Unlawful acts; exceptions.
(a) Except as otherwise provided in this Act,
it shall be unlawful:
(1) for any action to be taken that causes any     company to become a bank holding company as defined in this Act with respect to any Illinois bank;
(2) for any action to be taken that causes an     Illinois bank to become a subsidiary of a bank holding company;
(3) for any bank holding company to acquire direct or     indirect ownership or control of any voting shares of an Illinois bank that possesses a charter issued by the Commissioner, unless the holding company complies with the change in control requirements set forth in Section 18 of the Illinois Banking Act;
(4) for any bank holding company or subsidiary     thereof other than a bank, to acquire all or substantially all of the assets of an Illinois bank;
(5) for any bank holding company owning or     controlling, as defined in this Act, an Illinois bank to merge or consolidate with any other bank holding company;
(6) for any bank holding company with a ratio of     total capital to total assets of less than 7%, as measured and applied in accordance with regulations of the Board of Governors of the Federal Reserve System in effect on the date of the filing of the application with the Board of Governors of the Federal Reserve System, to acquire direct or indirect ownership or control by purchase of stock, merger, consolidation, acquisition of assets or otherwise, of any Illinois bank or banks if the application for such acquisition is filed on or after July 1, 1986; provided that the total capital to total assets ratio requirements of this paragraph (6) and of the succeeding paragraph (7) shall be applicable only to a bank holding company which is directly acquiring such direct or indirect control of any Illinois bank or banks and shall not be applicable to any bank holding company of which the acquiring company is a subsidiary; or
(7) for any bank holding company with a ratio of     total capital to total assets equal to or in excess of 7% to acquire direct or indirect control by purchase of stock, merger, consolidation, acquisition of assets or otherwise, of any Illinois bank or banks where such acquisition would result in a reduction in such bank holding company's ratio of total capital to total assets to less than 7%, where such ratios are measured and applied in accordance with regulations of the Board of Governors of the Federal Reserve System in effect on the date of the filing of the application with the Board of Governors of the Federal Reserve System if the application for such acquisition is filed on or after July 1, 1986.
(b) Notwithstanding subsection (a) of this Section, a transaction,
occurrence or event which is described in paragraphs (1), (2), (4), and (5) of
subsection (a) of this Section, and which does not result in a violation
of Section 3.07 of this Act, shall
not be unlawful if:
(1) approval of the transaction, occurrence or event     by the Board of Governors of the Federal Reserve System is not required by the terms of the federal Bank Holding Company Act; or
(2) the transaction, occurrence or event:
(A) has been approved by the Board of Governors         of the Federal Reserve System by an order, ruling or regulation of that Board made under the federal Bank Holding Company Act, including an assessment of the applicant's record in meeting the convenience and needs of the communities it serves in accordance with the federal Community Reinvestment Act of 1977,  and that order, ruling or regulation remains in effect; and
(B) is carried out and occurs in compliance with         all conditions or restrictions, if any, contained in an order, ruling or regulation of the Board of Governors of the Federal Reserve System referred to in the foregoing subparagraph (A).
(Source: P.A. 88-546; 89-567, eff. 7-26-96.)
(205 ILCS 10/3.05) (from Ch. 17, par. 2508)
Sec. 3.05. 
		(Repealed).
(Source: Repealed by P.A. 88-546.)
(205 ILCS 10/3.06) (from Ch. 17, par. 2509)
Sec. 3.06. 
		(Repealed).
(Source: Repealed by P.A. 88-546.)
(205 ILCS 10/3.061) (from Ch. 17, par. 2509.01)
Sec. 3.061. 
		
		Any bank holding company which was registered with the
Federal Reserve Board as a bank holding company as of December 31, 1981,
and as of that date lawfully owned or controlled at least two Illinois
banks or any Illinois bank holding company or companies may, on or after
January 1, 1982, continue to own shares of such Illinois bank or banks or
of such bank holding company or companies; acquire additional shares of
such Illinois bank or banks; and, acquire control of, directly or
indirectly, an existing Illinois bank or banks.
(Source: P.A. 84-1123.)
(205 ILCS 10/3.07) (from Ch. 17, par. 2510)
Sec. 3.07. 
		
		Except as authorized under Section 3.061 of this
Act, no bank holding
company other than an Illinois bank holding company, may control
any Illinois bank or own more than 5% of the voting
shares of any Illinois bank, unless:  (a) such bank
holding company acquired such control or voting shares under
circumstances described in
(A), (B), (C), (D) or (E) of subsection (h) of Section 2 of this
Act; or (b) such bank holding
company qualifies under the provisions of Section 3.071.
(Source: P.A. 84-1123.)
(205 ILCS 10/3.071) (from Ch. 17, par. 2510.01)
Sec. 3.071. Out of state bank holding companies.
(a) An out of state bank holding company may acquire ownership of more
than 5% of the voting shares of or control of one or more Illinois banks or
Illinois bank holding companies pursuant to a transaction, occurrence or
event that is described in paragraphs (1) through (5) of subsection (a) of
Section 3.02, provided the acquisition is made in accordance with Sections 3.02
and 3.07 of this Act in accordance with subsection (i) of this Section and
provided the following conditions
are met:
(1) (Blank).
(2) An out of state bank holding company seeking to     acquire an Illinois bank or Illinois bank holding company pursuant to subsection (a) of Section 3.071 shall, if change in control of the bank is governed by Section 18 of the Illinois Banking Act, file with the Commissioner the application required by that Section containing information satisfactory to the Commissioner.
(b) (Blank).
(c) (Blank).
(d) (Blank).
(e) (Blank).
(f) (Blank).
(g) (Blank).
(h) (Blank).
(i) (1) An out of state bank holding company which     directly or indirectly controls or has control over an Illinois bank that has existed and continuously operated as a bank for 5 years or less, may not cause the Illinois bank to merge with or into, or to have all or substantially all of the assets acquired by a bank that is an out of state bank.
(2) For purposes of subsection (i)(1) of this     Section, an Illinois bank that is the resulting bank following a merger involving an Illinois interim bank shall be considered to have been in existence and continuously operated during the existence and continuous operation of the Illinois merged bank. As used in this subsection (i)(2), the words "resulting bank" and "merged bank" shall have the meanings ascribed to those words in Section 2 of the Illinois Banking Act. As used in this subsection (i)(2), the words "interim bank" shall mean a bank which shall not accept deposits, make loans, pay checks, or engage in the general business of banking or any part thereof, and is chartered solely for the purpose of merging with or acquiring control of, or acquiring all or substantially all of the assets of an existing Illinois bank.
(3) The provisions of subsection (i)(1) of this     Section shall not apply to the merger or acquisition of all or substantially all of the assets of an Illinois bank:
(i) if the merger or acquisition is part of a         purchase or acquisition with respect to which the Federal Deposit Insurance Corporation provides assistance under Section 13(c) of the Federal Deposit Insurance Act; or
(ii) if the Illinois bank is in default or in         danger of default.  As used in this subsection (i)(3)(ii), the words "in default" and "in danger of default" shall have the meaning ascribed to those words in Section 2 of the Illinois Banking Act; or
(iii) if the bank with which the Illinois bank is         being merged or that is acquiring all or substantially all of the assets of the Illinois bank has its main banking premises in a state that is deemed to be reciprocal with Illinois and would be eligible to establish a branch pursuant to Section 21.4 of the Illinois Banking Act. (Source: P.A. 93-965, eff. 8-20-04.)
(205 ILCS 10/3.072) (from Ch. 17, par. 2510.02)
Sec. 3.072. 
		
		The Commissioner shall have the authority to examine
an out of state bank holding company which has an application pending under
paragraph (2) of subsection (a) of Section 3.071 and all of its bank
subsidiaries and any out of state bank holding company which controls an
Illinois bank or Illinois bank holding company and all such out of state
bank holding company's bank subsidiaries. The Commissioner may enter into
cooperative and reciprocal agreements with the bank regulatory authorities
of any state for the periodic examination of such bank holding companies
and may accept reports of examination and other reports from such
authorities in lieu of conducting his own examinations and may provide to
such authorities reports of examination of an Illinois bank holding company
and its subsidiary Illinois bank or banks conducted by the Commissioner
when such Illinois bank holding company has an application pending with or
approved by the bank regulatory authorities of any state to acquire control
of a bank whose main banking premises is located in another state or a bank
holding company whose principal place of business is another  state.  The
Commissioner may enter into joint actions with other regulatory bodies
having concurrent jurisdiction or may enter into such other actions
independently to carry out his responsibilities and assure compliance with
the laws of this State.
(Source: P.A. 85-298.)
(205 ILCS 10/3.073) (from Ch. 17, par. 2510.03)
Sec. 3.073. 
		(Repealed).
(Source: P.A. 84-1123. Repealed by P.A. 89-208, eff. 9-29-95.)
(205 ILCS 10/3.074)
Sec. 3.074. Powers; administrative review.
(a) The Secretary shall have the power and authority:
(1) to promulgate reasonable rules for the purposes     of administering the provisions of this Act.  The Secretary shall specify the form of any application, report or document that is required to be filed with the Secretary pursuant to this Act;
(2) to issue orders for the purpose of administering     the provisions of this Act and any rule promulgated in accordance with this Act;
(3) to appoint hearing officers to execute any of the     powers granted to the Secretary under this Section for the purpose of administering this Act or any rule promulgated in accordance with this Act;
(4) to subpoena witnesses, to compel their     attendance, to administer an oath, to examine any person under oath and to require the production of any relevant books, papers, accounts and documents in the course of and pursuant to any investigation or hearing being conducted or any action being taken by the Secretary in respect to any matter relating to the duties imposed upon or the powers vested in the Secretary under the provisions of this Act or any rule promulgated in accordance with this Act; and
(5) to do any other act authorized to the     Commissioner (now Secretary) under the Division of Banking Act.
(b) Whenever, in the opinion of the Secretary, any
director,
officer, employee, or agent of any bank holding company or subsidiary or
affiliate of
that company shall have violated any law, rule, or order relating to that bank
holding company or subsidiary or affiliate of that company, shall have
obstructed or
impeded any examination or investigation by the Secretary, shall  have
engaged  in  an  unsafe or unsound  practice  in conducting the business
of that bank holding company or subsidiary or affiliate of that company, or
shall have
 violated any law or engaged or participated in  any  unsafe  or  unsound
practice  in connection with any financial institution or other business
entity such that the character and fitness of the director, officer,
employee, or agent does not assure reasonable promise of safe and sound
operation of the bank holding company, the
Secretary may issue an order of removal.  If, in the opinion of the Secretary, any former director, officer, employee, or agent of a bank
holding company or subsidiary or affiliate of that company, prior to the
termination of his or her service with that holding company or subsidiary or
affiliate of that company, violated any law, rule, or order relating to that
bank holding company or subsidiary or affiliate of that company, obstructed
or impeded any examination or investigation by the Secretary, engaged
in an unsafe or unsound practice in conducting the business of that bank
holding
company or subsidiary or affiliate of that company, or violated any law  or
engaged
or participated in any unsafe or unsound practice in connection with any
financial  institution  or other business entity such that the character
and fitness of the director, officer, employee, or agent would not  have
assured reasonable promise of safe and sound operation of the bank
holding company, the Secretary may issue an order prohibiting that
person from further service with a bank holding company or subsidiary or
affiliate of that company as a director, officer, employee, or agent.
An order
issued
pursuant to this subsection shall be served upon the director, officer,
employee, or agent. A copy of the order shall be sent to each director of
the bank holding company affected by registered mail. A copy of the order
shall also be served upon the bank holding company of which he is a director,
officer,
employee, or agent, whereupon he shall cease to be a director, officer,
employee, or agent of that bank holding company.
The Secretary may
institute a
civil action against the director, officer, employee, or agent of the bank
holding
company, against whom
any order provided for by this subsection has been
issued, to enforce compliance with or to enjoin any violation of the terms
of the order.
Any person who has been the subject of an order of removal
or an order of prohibition issued by the Secretary under this subsection,
subdivision (7) of Section 48 of the Illinois Banking Act, or
Section 5-6 of the Corporate Fiduciary Act may not thereafter serve as
director, officer, employee, or agent of any holding company, State bank, or
branch
of any out-of-state bank, of any corporate fiduciary, as defined in
Section 1-5.05 of the Corporate Fiduciary Act, or of any other entity
that is subject to licensure or regulation by the Division of Banking unless the Secretary has granted
prior approval in writing.
(c) All final administrative decisions of the Secretary
 under
this
Act shall be subject to judicial review pursuant to provisions of the
Administrative Review Law. For matters involving administrative review,
venue shall be in either Sangamon County or Cook County.
(Source: P.A. 96-1163, eff. 1-1-11; 96-1365, eff. 7-28-10; 97-333, eff. 8-12-11.)
(205 ILCS 10/3.075)
Sec. 3.075. 
		Reliance on Commissioner. 
		No bank holding company or other
person shall be liable under this Act for any act done or omitted in good faith
in conformity with any rule, interpretation, or opinion issued by
the Commissioner of Banks and Real Estate, notwithstanding that after the act
or omission has occurred, the rule, opinion, or interpretation upon
which reliance is placed is amended, rescinded, or determined by judicial or
other authority to be invalid for any reason.
(Source: P.A. 90-161, eff. 7-23-97.)
(205 ILCS 10/3.08) (from Ch. 17, par. 2510a)
Sec. 3.08. 
		Acquisition of trust companies. 
		Any bank holding company may
own, acquire or control,
directly or indirectly, a corporation which has been or shall be
incorporated under the general corporation laws of this State for the
purpose of accepting and executing trusts under the Corporate Fiduciary Act.
(Source: P.A. 89-208, eff. 9-29-95.)
(205 ILCS 10/3.09)
Sec. 3.09. 
		Acquisition; deposit concentration limits.
(a) Except as otherwise expressly provided in this Section, no bank holding
company shall acquire control of, or acquire all or substantially all of the
assets of a State bank or a national bank whose main banking premises is
located in Illinois if, upon consummation of acquisition, the bank holding
company, including affiliates of the bank holding company, would control 30% or
more of the total amount of deposits which are located in this State at insured
depository institutions. For purposes of this Section the words "insured
depository institutions" shall mean State banks, national banks, and insured
savings associations. For purposes of this Section, the word "deposits" shall
have the meaning ascribed to that word in Section 3(1) of the Federal Deposit
Insurance Act. For purposes of this Section, the total amount of deposits which
are considered to be located in this State at insured depository institutions
shall equal the sum of all deposits held at the main banking premises and
branches
in the State of Illinois of State banks, national banks, and insured savings
associations. For purposes of this Section the word "affiliates" shall have the
meaning ascribed to that word in Section 35.2 of the Illinois Banking Act.
(b) Notwithstanding the provisions of subsection (a) of this Section, the
Commissioner or the appropriate federal banking agency may approve an
acquisition of a bank that is in default or in danger of default. The
provisions of subsection (a) of this Section may not be waived, whether
pursuant
to Section 3(d) of the federal Bank Holding Company Act of 1956 or Section
44(d)
of the Federal Deposit Insurance Act, except as expressly provided in this
subsection (b).
(Source: P.A. 90-226, eff. 7-25-97.)
(205 ILCS 10/3.10)
Sec. 3.10. 
		Non-English language transactions. 
		A bank holding company may
conduct
transactions in a language other than English through an employee or agent
acting as interpreter or through an interpreter provided by the customer.
(Source: P.A. 92-578, eff. 6-26-02.)
(205 ILCS 10/3.1) (from Ch. 17, par. 2510.1)
Sec. 3.1. 
		
		The Commissioner may appoint a suitable
person or persons to make an examination of the affairs of any company
that directly or indirectly owns or controls 25% or more of the voting shares
of a State bank.
A person so appointed shall not be a stockholder or officer or employee
of any company which such person may be directed to examine, and shall have
the power to make a thorough examination into all of the affairs of the
company and in so doing to examine any of the officers or agents or employees
thereof on oath and shall make a full and detailed report of the condition
of such company.  Such person shall require a current list of the stockholders
of the company including the number of shares of stock held by and the address
of each stockholder, to be furnished at the time of examination or at any
time upon request of the Commissioner.
(Source: P.A. 90-301, eff. 8-1-97.)
(205 ILCS 10/5) (from Ch. 17, par. 2512)
Sec. 5. 
		Partial invalidity. 
		If any provision of this Act, or the application
of such provision to any person or
circumstances, shall be held invalid, the remainder of the Act and the
application of such provision to persons or circumstances other than those
to which it is held invalid, shall not be affected thereby.
(Source: P.A. 89-208, eff. 9-29-95.)
(205 ILCS 10/7) (from Ch. 17, par. 2513)
Sec. 7. 
		
		This Act may be cited as the Illinois Bank Holding Company Act of 1957.
(Source: P.A. 86-1475.)