2023 Illinois Compiled Statutes › Chapter 205 - FINANCIAL REGULATION › 205 ILCS 205/ - Savings Bank Act. › Article 6 - Investments

(205 ILCS 205/Art. 6 heading)
ARTICLE 6.  
		Investments
(205 ILCS 205/6001) (from Ch. 17, par. 7306-1)
Sec. 6001. General provisions.
(a) No savings bank shall make any loan or investment
authorized by this Article unless the savings bank first has
determined that the type, amount, purpose, and repayment provisions
of the loan or investment in relation to the borrower's or issuer's
resources and credit standing support the reasonable belief that
the loan or investment will be financially sound and will be repaid
according to its terms and that the loan or investment is not
otherwise unlawful.
(b) Each loan or investment that a savings bank makes or
purchases, whether wholly or in part, must be adequately
underwritten, reviewed periodically, and reserved against as
necessary in accordance with its payment performance, all in
accordance with the regulations and directives of the Commissioner.
(c) Every appraisal or reappraisal of property that a
savings bank is required to make shall be made as follows:
(1) By an independent qualified appraiser, designated     by the board of directors, who is properly licensed or certified by the entity authorized to govern his licensure or certification and who meets the requirements of the Appraisal Subcommittee and of the Federal Act.
(2) In the case of an insured or guaranteed loan, by     any appraiser appointed by any lending, insuring, or guaranteeing agency of the United States or the State of Illinois that insures or guarantees the loan, wholly or in part.
(3) Each appraisal shall be in writing prepared at     the request of the lender for the lender's use; disclose the market value of the security offered; contain sufficient information and data concerning the appraised property to substantiate the market value thereof; be certified and signed by the appraiser or appraisers; and state that the appraiser or appraisers have personally examined the described property.  The appraisal shall be filed and preserved by the savings bank. In addition, the appraisal shall be prepared and reported in accordance with the Standards of Professional Practice and the ethical rules of the Appraisal Foundation as adopted and promulgated by the Appraisal Subcommittee.
(d) If appraisals of real estate securing a savings bank's
loans are obtained as part of an examination by the Commissioner,
the cost of those appraisals shall promptly be paid by the savings
bank directly to the appraiser or appraisers.
(e) Any violation of this Article shall
constitute an unsafe or unsound practice.  Any person who knowingly
violates any provision of this Article shall be subject to
enforcement action or civil money penalties as provided for in this
Act.
(f) For purposes of this Article, "underwriting" shall mean the process
of compiling information to support a determination as to whether an
investment or extension of credit shall be made by a savings bank.  It
shall include, but not be limited to, evaluating a borrower's
creditworthiness, determination of the value of the underlying collateral,
market factors, and the appropriateness of the investment or loan for the
savings bank.  Underwriting as used herein does not include the agreement to
purchase unsold portions of public offerings of stocks or bonds as commonly
used in corporate securities issuances and sales.
(g) For purposes of this Section, the following definitions shall apply:
(1) "Federal Act" means Title XI of the Financial     Institutions Reform, Recovery, and Enforcement Act of 1989 and regulations adopted pursuant thereto.
(2) "Appraisal Subcommittee" means the designee of     the heads of the Federal Financial Institutions Examination Council Act of 1978 (12 U.S.C. 3301 et seq.).
(3) "Appraisal Foundation" means the Appraisal     Foundation that was incorporated as an Illinois not-for-profit corporation on November 30, 1987.
(Source: P.A. 102-687, eff. 12-17-21.)
(205 ILCS 205/6002) (from Ch. 17, par. 7306-2)
Sec. 6002. Investment in loans.
(a) Subject to the regulations of the
Commissioner, a savings bank may loan funds as follows:
(1) On the security of deposit accounts, but no such     loan shall exceed the withdrawal value of the pledged account.
(2) On the security of real estate:
(A) of a value, determined in accordance with         this Act, sufficient to provide good and ample security for the loan;
(B) with a fee simple title or a leasehold title;
(C) with the title established by evidence of         title as is consistent with sound lending practices in the locality;
(D) with the security interest in the real estate         evidenced by an appropriate written instrument and the loan evidenced by a note, bond, or similar written instrument; a loan on the security of the whole of the beneficial interest in a land trust satisfies the requirements of this paragraph if the title to the land is held by a corporate trustee and if the real estate held in the land trust meets the other requirements of this subsection;
(E) with a mortgage loan not to exceed 40 years.
(3) For the purpose of repair, improvement,     rehabilitation, furnishing, or equipment of real estate.
(4) For the purpose of financing or refinancing an     existing ownership interest in certificates of stock, certificates of beneficial interest, other evidence of an ownership interest in, or a proprietary lease from a corporation, trust, or partnership formed for the purpose of the cooperative ownership of real estate, secured by the assignment or transfer of certificates or other evidence of ownership of the borrower.
(5) Through the purchase of loans that, at the time     of purchase, the savings bank could make in accordance with this Section and the bylaws.
(6) Through the purchase of installment contracts for     the sale of real estate and title thereto that is subject to the contracts, but in each instance only if the savings bank, at the time of purchase, could make a mortgage loan of the same amount and for the same length of time on the security of the real estate.
(7) Through loans guaranteed or insured, wholly or in     part, by the United States or any of its instrumentalities.
(8) Subject to regulations adopted by the     Commissioner, through secured or unsecured loans for business, corporate, commercial, or agricultural purposes; provided that the total of all loans granted under this paragraph shall not exceed 15% of the savings bank's total assets unless a greater amount is authorized in writing by the Commissioner.
(9) For the purpose of manufactured home financing     subject, however, to the regulation of the Commissioner. As used in this  Section, "manufactured home" means a manufactured home as defined in subdivision (53) of Section 9-102 of the Uniform Commercial Code.
(10) Through loans secured by the cash surrender     value of any life insurance policy or any collateral that would be a legal investment under the terms of this Act if made by the savings bank.
(11) Any provision of this Act or any other law,     except for paragraph (18) of Section 6003, to the contrary notwithstanding, but subject to the Financial Institutions Insurance Sales Law and subject to the Commissioner's regulations, any savings bank may make any loan or investment or engage in any activity that it could make or engage in if it were organized under State law as a savings and loan association or under federal law as a federal savings and loan association or federal savings bank.
(12) A savings bank may issue letters of credit or     other similar arrangements only as provided for by regulation of the Commissioner with regard to aggregate amounts permitted, take out commitments for stand-by letters of credit, underlying documentation and underwriting, legal limitations on loans of the savings bank, control and subsidiary records, and other procedures deemed necessary by the Commissioner.
(13) For the purpose of automobile financing, subject     to the regulation of the Commissioner.
(14) For the purpose of financing primary, secondary,     undergraduate, or postgraduate education.
(15) Through revolving lines of credit on the     security of a first or junior lien on the borrower's personal residence, based primarily on the borrower's equity, the proceeds of which may be used for any purpose; those loans being commonly referred to as home equity loans.
(16) As secured or unsecured credit to cover the     payment of checks, drafts, or other funds transfer orders in excess of the available balance of an account on which they are drawn, subject to the regulations of the Commissioner.
(b)  For purposes of this  Section, "real estate" includes a manufactured home as defined in subdivision (53) of Section 9-102 of the Uniform Commercial Code which is real property as defined in Section 5-35 of the Conveyance and Encumbrance of Manufactured Homes as Real Property and Severance Act.
(Source: P.A. 98-749, eff. 7-16-14.)
(205 ILCS 205/6003) (from Ch. 17, par. 7306-3)
Sec. 6003. 
		Other investments. 
		A savings bank may invest funds as
provided in this Section:
(1) In demand, time, or savings deposits or accounts,     withdrawable accounts, or other insured obligations of any financial institution the accounts of which are insured by a federal agency.
(2) In participating interests in loans of a type     that the savings bank would be authorized to make, but only if the other participants are (A) savings banks organized under this Act, (B) savings and loan associations, banks, credit unions, and licensees under the Consumer Installment Loan Act or the Sales Finance Agency Act, organized under the laws of this State, (C) associations or corporations insured by an instrumentality of the United States, (D) instrumentalities of or corporations owned wholly or in part by the United States or this State, or, (E) subject to regulations of the Commissioner, service corporations of a savings bank organized under this Act or subsidiaries of a savings and loan association, bank, or credit union organized under the laws of this State or the United States.
(3) In obligations of, or obligations that are fully     guaranteed by the United States and in stocks or obligations of any Federal Reserve Bank, Federal Home Loan Bank, the Student Loan Market Association, the Government National Mortgage Association, the Federal National Mortgage Association, The Federal Home Loan Mortgage Corporation, the Federal Deposit  Insurance Corporation, or any other agency of the United States.
(4) In bonds or other direct obligations of, or     guaranteed as to principal and interest by, this State.
(5) In obligations that by the laws of this State are     made legal investments for savings banks.
(6) In bonds or other evidences of indebtedness that     are direct general obligations of any unit of local government of this State or in bonds or other evidences of indebtedness that are payable from revenues or earnings specifically pledged therefor of a unit of local government, but in no event shall the total amount of the securities of any one maker or obligor exceed 15% of the savings bank's total capital, nor shall the aggregate amount of investments under this paragraph exceed 15% of the savings bank's total assets.
(7) Equity investments in real estate.  With the     prior written consent of the Commissioner, a savings bank may invest in the initial purchase and development, or the purchase or commitment to purchase after completion, of home sites and housing for sale or rental, including, but not limited to, projects for the reconstruction, rehabilitation, or rebuilding of residential properties to meet the minimum standards of health and occupancy prescribed by appropriate local authorities, the provision of accommodations for retail stores, shops, and other community services that are reasonably incident to that housing or in the shares of a corporation that owns one or more of those projects and that is wholly owned by one or more financial institutions whose investments are regulated by the laws of this State or of the United States.  In no event shall the total investment in any one project exceed 15% of the savings bank's total capital, nor shall the aggregate investment under this paragraph exceed 50% of its total capital.  No savings bank may make an investment of this type unless it is in compliance with the capital requirements of this Act and with the capital maintenance requirements of its insurer of deposit accounts.   The Commissioner shall approve the investment only if the savings bank shows:
(A) that the savings bank has adequate assets         available for the investment;
(B) that the proposed investment does not exceed         the reasonable market value of the property or interest therein as determined in accordance with the appraisal requirements of this Act; and
(C) that all other requirements of this Section         have been met.
Nothing contained in this paragraph prohibits a     savings bank from developing or building on land acquired by it under any other provision of this Act nor from completing the construction of buildings in accordance with any construction loan contract where the borrower has failed to comply with the terms of the contract.
(8) In obligations of the State of Israel or     obligations fully guaranteed by the State of Israel as to payment of principal and interest, but in no event shall the total amount of that investment exceed 15% of the savings bank's total capital.
(9) In stocks or obligations of business development     corporations chartered by this State or by the United States or an agency thereof, but in no event shall the aggregate amount of stock exceed 2.5% of the savings bank's total capital or $250,000, whichever is greater.
(10) In obligations of urban renewal investment     corporations chartered under the laws of this State, or the United States, or in certificates of beneficial interest of urban renewal investment trusts, but in no event shall the aggregate amount of the stock, obligations or beneficial interest certificates of any one maker exceed 2.5% of the savings bank's total capital, nor shall the aggregate amount of investments under this paragraph exceed 15% of its total capital.
(11) Subject to the regulations of the Commissioner,     in loans deemed sufficiently secured by the board of directors of the savings bank.  However, if the security is stock or equity securities of any kind other than those of a financial institution, the stock or securities must be listed on a national exchange or actively traded and quoted on an over-the-counter market or their value must be ascertainable in accordance with regulations promulgated by the Commissioner.
(12) In commercial paper.  As used in this Section,     the term "commercial paper" means short term obligations having a maturity ranging from 2 to 270 days issued by banks, corporations, or other borrowers.  Investments in commercial paper under this Section must be in securities rated in one of the 4 highest categories by a nationally recognized rating service.
(13) Purchase of stock in insurance companies.     Notwithstanding any provision of this Act to the contrary, a savings bank may purchase shares of, or otherwise acquire equity interests in, insurance companies and insurance holding companies organized to provide insurance for savings institutions and corporations and individuals affiliated with savings institutions, provided ownership of equity interests is a prerequisite to obtaining directors and officers' and blanket bond insurance through the company or companies.  The Commissioner may promulgate regulations concerning the size of each savings bank's investment and manner of holding those investments.
(14) Subject to the regulation of the Commissioner,     in equity or debt securities or instruments of a service corporation subsidiary of the savings bank.
(15) Through advances of federal funds to designated     depositories, provided that the advances are made on the condition that they be repaid on the next business day following the date on which the advance is made.  For the purposes of this paragraph, the term "federal funds" means funds that a savings bank has on deposit at a depository that are exchangeable for funds on deposit at a federal reserve bank; the term "business day" means any day on which the savings bank, the depository, and the federal reserve bank where the funds are on deposit are all open for general business.
(16) In financial futures or options transactions     subject to the regulations of the Commissioner.
(17) In a subsidiary chartered for the purpose of     exercising all powers necessary to act as a corporate fiduciary under the Corporate Fiduciary Act.
(18) In marketable investment securities, but in no     event shall the total amount of those securities of any one maker or obligor exceed 15% of the savings bank's total capital nor shall the aggregate amount of investments under this Section exceed 15% of total assets.  As used in this Section, the term "marketable investment securities" does not include stocks, but means investment grade marketable obligations evidencing indebtedness of any person in the form of bonds, notes, or debentures commonly known as investment securities, and of a type customarily sold on recognized exchanges or traded over the counter and investment grade marketable obligations of the International Bank for Reconstruction and Development, the Inter-American Development Bank, the Asian Development Bank, the African Development Bank, or the International Finance Corporation.  As used in this Section, the term "investment grade" means being rated in one of the 4 highest categories by at least one nationally recognized rating service.
(19) In investment grade marketable obligations of     any other state, territory, or possession or political subdivision thereof to the same extent that it may invest in marketable investment securities under paragraph (18) of this Section.
(Source: P.A. 89-317, eff. 8-11-95; 90-665, eff. 7-30-98.)
(205 ILCS 205/6004) (from Ch. 17, par. 7306-4)
Sec. 6004. 
		Calculation of interest; postpayments and prepayments.
(a) In any contract or loan that is secured by a mortgage,
deed of trust, or conveyance in the nature of a mortgage for the
purpose of purchase or refinance of residential real estate, the
interest that is computed, calculated, charged, or collected
pursuant to the contract or loan, or pursuant to any regulation
or rule promulgated under this Act, may not be computed,
calculated, charged or collected for any period of time occurring
after the date on which the total indebtedness, with the exception
of late payment penalties, is paid in full.
(b) For purposes of this Section, a prepayment means
the payment of the total indebtedness, with the exception of late
payment penalties if incurred or charged, on any date before the
date specified in the contract or loan agreement on which the total
indebtedness shall be paid in full, or before the date on which all
payments, if timely made, shall have been made.  In the event of
a prepayment of the indebtedness that is made on a date after the
date on which interest on the indebtedness was last computed,
calculated, charged, or collected but before the next date on which
interest on the indebtedness was to be calculated, computed,
charged, or collected, the lender may calculate, charge, and collect
interest on the indebtedness for the period that elapsed between
the date on which the prepayment is made and the date on which
interest on the indebtedness was last computed, calculated, charged,
or collected at a rate equal to 1/360 of the annual rate for each
day which so elapsed, which rate shall be applied to the
indebtedness outstanding as of the date of prepayment.  The lender
shall refund to the borrower any interest charged or collected
that exceeds that which the lender may charge or collect under
this subsection.
(Source: P.A. 86-1213.)
(205 ILCS 205/6005) (from Ch. 17, par. 7306-5)
Sec. 6005. 
		General loan contract provisions. 
		Each loan and any agreement for securing the loan shall be
evidenced by one or more written instruments, consistent with sound
lending practices in the locality.  Whenever recordation of an
instrument is necessary to establish priority over the claim of any
third party, the instrument shall be recorded.
(Source: P.A. 86-1213.)
(205 ILCS 205/6006) (from Ch. 17, par. 7306-6)
Sec. 6006. 
		Modification agreements. 
		A savings bank, at any time, may enter into a written
agreement with a borrower to modify, in any manner not
inconsistent with the provisions of this Act, the terms of a loan
as to the amount, time or method of the payments to be made, the
interest rate, and any other provision of the loan contract, and the
loan contract and the security instrument shall not be prejudiced
by the making of any modification, even if a modification
was not provided for in the loan contract.
(Source: P.A. 86-1213.)
(205 ILCS 205/6007) (from Ch. 17, par. 7306-7)
Sec. 6007. Sale, assignment, and servicing of loans and contracts.
(a) Any savings bank may sell any loan or a participating
interest in a loan at any time in the usual and regular course of
business.  Loans sold may be sold with or without recourse except
as may otherwise be provided by regulations of the Secretary.
The Secretary may, by regulation, adopt limitations upon the
sale of loans.  The provisions of this subsection (a) do not apply
to the sale of loans to agencies of the United States, the State
of Illinois, or other government sponsored agencies as may be
approved by the Secretary.
(b) A savings bank may contract to service a loan or a
participating interest in a loan, but a contract therefor shall conform
to any  pertinent regulations prescribed by the Secretary and
shall require sufficient compensation to reimburse the savings bank
for all expenses incurred under the contract.
(c) A savings bank may sell and assign, with or without
recourse, any master's certificate of sale, defaulted loan, or
defaulted real estate contract to any person eligible to purchase
it for an amount not less than the fair cash market value
thereof.
(Source: P.A. 97-492, eff. 1-1-12.)
(205 ILCS 205/6008) (from Ch. 17, par. 7306-8)
Sec. 6008. Purchase of real estate at forced sale. A savings bank may
purchase at any sheriff's or other judicial sale, either public or private,
any real estate upon which the savings bank has any mortgage, lien or other
encumbrance, or in which the savings bank has any other interest.  The
savings bank thereafter may repair, insure, improve, sell, convey, lease,
preserve, mortgage, exchange, or otherwise dispose of real estate so
acquired in the best interests of the savings bank. For purposes of this  Section, "real estate" includes a manufactured home as defined in subdivision (53) of Section 9-102 of the Uniform Commercial Code which is real property as defined in Section 5-35 of the Conveyance and Encumbrance of Manufactured Homes as Real Property and Severance Act.
(Source: P.A. 98-749, eff. 7-16-14.)
(205 ILCS 205/6009) (from Ch. 17, par. 7306-9)
Sec. 6009. Purchase of real estate for office and rental purposes.
(a) A savings bank may acquire and hold real estate in fee
simple or leaseholds on which a building or buildings exist or are
to be erected suitable for the transaction of the savings bank's
business, and from portions of which not required for the savings
bank's own use, revenue may be derived; or may own all or part of
the capital stock, shares, or interest in any corporation,
limited liability company, association, or trust engaged solely in holding all or part of that
real estate.  However, the amount so invested under this Section and item (7)
of Section 6003 may not exceed a savings bank's total capital unless the
Secretary, upon a
proper showing, approves a larger amount consistent with the needs
of the savings bank's business and its immediate future expansion.
(b) Unless prior written approval of the Secretary is
obtained, no savings bank may purchase, lease, or otherwise acquire
a site for an office building or interest in real estate from any
officer, director, employee, or stockholder holding more than 10%
of the aggregate capital stock of the savings bank, or any firm,
corporation, entity, or family in which any officer, director,
employee, or stockholder holding more than 10% of the aggregate
capital stock of a savings bank has any direct or indirect
interest.
(c) An acquisition prohibited by this Section includes the
purchase, lease, or acquisition of property in which any of the
persons described in this Section held any interest for a period
of 10 years preceding the purchase, lease, or acquisition, but does
not include the acquisition of an option for a site or real
estate where the option is assignable and exercised by the savings
bank in its own name and for its own benefit.
(Source: P.A. 97-492, eff. 1-1-12.)
(205 ILCS 205/6010) (from Ch. 17, par. 7306-10)
Sec. 6010. 
		Prohibited loans. 
		No savings bank may make a loan to any
person owning 10% or more of its capital stock, any affiliated person,
agent, or attorney of the savings bank, either individually or as an agent
or partner of another, except in accordance with laws and regulations
applicable to similar transactions to which banks are subject.
(Source: P.A. 86-1213.)
(205 ILCS 205/6011) (from Ch. 17, par. 7306-11)
Sec. 6011. 
		Effect of unauthorized investments.
(a) Every loan or other investment made in violation of this
Act shall be due and payable according to its terms, and the
obligation thereof shall not be impaired.
(b) Every director or officer of a savings bank who shall knowingly
participate in or assent to, or who shall knowingly
permit any of the officers or agents of the savings bank to make,
investments not authorized by this Act shall be liable
individually for all damage that the savings bank may sustain in
consequence of the investments, in addition to any criminal
penalties prescribed by this Act.
(c) The Commissioner may require every director or officer
of a savings bank who shall knowingly participate in or
assent to, or who shall knowingly permit any of the officers or
agents of the savings bank to make, investments not authorized by
this Act to deposit with the savings bank an indemnity bond,
insurance, or collateral of a kind and amount sufficient to
indemnify the savings bank against damages that the savings bank
may sustain in consequence of the investments.  The amount
considered sufficient to indemnify the savings bank shall, in the
case of an unauthorized investment, be the difference between the
book value and the market value of the investment at the time the
Commissioner makes his determination that the investment is
unauthorized.  The amount considered sufficient to indemnify the
savings bank, in the case of an unauthorized loan, shall be the
difference between the book value of the loan and the amount that
could have been made under the provisions of this Act.  Whenever
an unauthorized investment has been sold or disposed of without
recourse, the Commissioner shall release all or part of the
indemnity after deducting any loss.  Whenever the balance of an
unauthorized loan has been reduced to an amount that would permit
the loan to be made under the provisions of this Act, the
indemnity shall be released, provided that the Commissioner in
making the determination may require an independent appraisal of
the security.
(Source: P.A. 86-1213.)
(205 ILCS 205/6012) (from Ch. 17, par. 7306-12)
Sec. 6012. 
		Acknowledgments. 
		No acknowledgment of a deed, mortgage, or
other instrument shall be invalid because the acknowledgment was taken
before an officer authorized by the laws of this State to acknowledge
conveyances who is also a member, director, employee, or officer of a
savings bank that is a party to the deed, mortgage, or other instrument.
(Source: P.A. 86-1213.)
(205 ILCS 205/6013) (from Ch. 17, par. 7306-13)
Sec. 6013. 
		Loans to one borrower.
(a) Except as provided in subsection (c), the total loans and extensions
of credit, both direct and
indirect, by a savings bank to any person, other than a municipal
corporation for money borrowed, outstanding at one time shall not
exceed 25% of the savings bank's total capital plus general loan
loss reserves.
(b) Except as provided in subsection (c), the total loans and extensions
of credit, both direct and
indirect, by a savings bank to any person outstanding at one time
and at least 100% secured by readily marketable collateral having
a market value, as determined by reliable and continuously
available price quotations, shall not exceed 10% of the savings
bank's total capital plus general loan loss reserves.  This limitation
shall be separate from and
in addition to the limitation contained in subsection (a).
(c) If the limit under subsection (a) or (b) on total loans to one
borrower is less than $500,000, a savings bank that meets its minimum capital
requirement under this Act may have loan and extensions of credit, both direct
and indirect, outstanding to any person at one time not to exceed $500,000.
With
the prior written approval of the Commissioner, a savings bank that has capital
in excess of 6% of assets may make loans and extensions of credit to one
borrower for the development of residential housing properties, located or to
be located in this State, not to exceed 30% of the savings bank's total capital
plus general loan loss reserves.
(d) For purposes of this Section, the term "person" shall be
deemed to include an individual, firm, corporation, business trust,
partnership, trust, estate, association, joint venture, pool,
syndicate, sole proprietorship, unincorporated association, any
political subdivision, or any similar entity or organization.
(e) For the purposes of this Section any loan or extension
of credit granted to one person, the proceeds of which are used for
the direct benefit of a second person, shall be deemed a loan or
extension of credit to the second person as well as the first
person.  In addition, a loan or extension of credit to one person
shall be deemed a loan or extension of credit to others when a common
enterprise exists between the first person and such other persons.
(f) For the purposes of this Section, the total liabilities
of a firm, partnership, pool, syndicate, or joint venture shall include the
liabilities of the members of the entity.
(g) For the purposes of this Section, the term "readily
marketable collateral" means financial instruments or bullion
that are salable under ordinary circumstances with reasonable
promptness at a fair market value on an auction or a similarly
available daily bid-and-ask price market.  "Financial instruments"
include stocks, bonds, notes, debentures traded on a national
exchange or over the counter, commercial paper, negotiable
certificates of deposit, bankers' acceptances, and shares in money
market or mutual funds.
(h) Each savings bank shall institute adequate procedures to
ensure that collateral fully secures the outstanding loan or
extension of credit at all times.
(i) If collateral values fall below 100% of the outstanding
loan or extension of credit to the extent that the loan or
extension of credit no longer is in conformance with subsection (b)
and exceeds the 25% limitation of subsection (a), the
loan must be brought into conformance with this Section within 5
business days except where judicial proceedings or other similar
extraordinary occurrences prevent the savings bank from taking
action.
(j) This Section shall not apply to loans or extensions of
credit to the United States of America or its agencies or this
State or its agencies or to any loan, investment, or extension of credit made
pursuant to Section 6003 of this Act.
(k) This Section does not apply to the obligations as endorser, whether
with or without recourse, or as guarantor, whether conditional or
unconditional, of negotiable or nonnegotiable installment consumer paper of the
person transferring the same if the bank's files or the knowledge of its
officers of the financial condition of each maker of those obligations is
reasonably adequate and if an officer of the bank, designated for that purpose
by the board of directors of the bank, certifies that the responsibility of
each maker of the obligations has been evaluated and that the bank is relying
primarily upon each maker for the payment of the obligations.  The
certification
shall be in writing and shall be retained as part of the records of the bank.
(l) The Commissioner may prescribe rules to carry out the purposes of this
Section and to establish limits or requirements other than those specified in
this Section for particular types of loans and extensions of credit.
(Source: P.A. 92-483, eff. 8-23-01; 92-700, eff. 7-19-02.)
(205 ILCS 205/6014) (from Ch. 17, par. 7306-14)
Sec. 6014. 
		Commissioner's regulations.
(a) The Commissioner shall promulgate rules and regulations
to determine permissible levels of investment and permissible
concentrations of assets for savings banks applicable to all lending
and investment authority granted by this Article 6.  The rules
and regulations shall give due regard to capital adequacy,
operating income, underwriting standards, risk inherent in the
investment or loan, and competitive parity with other financial
institutions.
(b) Violations of any of the provisions of this Article 6
shall constitute an unsafe and unsound practice and may subject the
savings bank, its directors, officers, or agents to enforcement
actions, civil money penalties, or other sanctions as provided in
this Act.
(Source: P.A. 86-1213.)