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| Public Act 103-0289
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| HB2043 Enrolled | LRB103 05826 BMS 50846 b |
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AN ACT concerning regulation.
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Be it enacted by the People of the State of Illinois,
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represented in the General Assembly:
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Section 5. The Illinois Credit Union Act is amended by |
changing Sections 16, 20, 29, and 48 as follows:
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(205 ILCS 305/16) (from Ch. 17, par. 4417)
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Sec. 16. Societies and associations. Societies,
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associations, clubs, partnerships, corporations, and limited
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liability companies in which one or more the majority of the |
members, partners, or
shareholders
are individuals who are
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eligible for credit union membership may be admitted to |
membership in a credit
union in the same
manner and under the |
same conditions as individuals, subject to such rules
as the |
Secretary and the Director may promulgate hereunder. Any |
members, partners, or shareholders who are ineligible for |
membership in the credit union shall not become eligible by |
virtue of the eligibility of the entity in which they hold an |
ownership interest.
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(Source: P.A. 97-133, eff. 1-1-12.)
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(205 ILCS 305/20) (from Ch. 17, par. 4421)
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Sec. 20. Election or appointment of officials.
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(1) The credit union shall
be directed by a board of |
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directors consisting of no less than 7 in number,
to be elected |
at the annual meeting by and from the members. Directors shall
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hold office until the next annual meeting, unless their
terms |
are staggered. Upon amendment of its bylaws, a credit union |
may divide
the directors into 2 or 3 classes with each class as |
nearly equal in number as
possible. The term of office of the |
directors of the first class shall expire
at the first annual |
meeting after their election, that of the second class
shall
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expire at the second annual meeting after their election, and |
that of the third
class, if any, shall expire at the third |
annual meeting after their election.
At each annual meeting |
after the classification, the number of directors equal
to the |
number of directors whose terms expire at the time of the |
meeting shall
be elected to hold office until the second |
succeeding annual meeting if there
are 2 classes or until the |
third succeeding annual meeting if there are 3
classes. A |
director shall hold office for the term for which he
or she is |
elected and until his or her
successor
is elected and |
qualified. |
(1.5) Except as provided in subsection (1.10), in all |
elections for directors, every member
has the right to vote, |
in person, by proxy, or by electronic record if approved by the |
board of directors, the number of shares owned
by him, or in |
the case of a member other than a natural person, the member's
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one vote, for as many persons as there are directors to be |
elected, or to
cumulate such shares, and give one candidate as |
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many votes as the number
of directors multiplied by the number |
of his shares equals, or to distribute
them on
the same |
principle among as many candidates as he may desire and the |
directors
shall not be elected in any other manner. Shares |
held in a joint account
owned by more than one member may be |
voted by any one of the members, however,
the number of |
cumulative votes cast may not exceed a total equal to the |
number
of shares multiplied by the number of directors to be |
elected. A majority of
the shares entitled
to vote shall be |
represented either in person or by proxy for the election
of |
directors. Each director shall wholly take and subscribe to an |
oath
that he will diligently and honestly perform his duties |
in administering
the affairs of the credit union, that while |
he may delegate to another the
performance of those |
administrative duties he is not thereby relieved from
his |
responsibility for their performance, that he will not |
knowingly violate
or permit to be violated any law applicable |
to the credit union,
and that he is the owner of at least one |
share of the credit union.
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(1.10) Upon amendment of a credit union's bylaws, in all |
elections for directors, every member who is a natural person |
shall have the right to cast one vote, regardless of the number |
of his or her shares, in person, by proxy, or by electronic |
record if approved by the board of directors, for as many |
persons as there are directors to be elected.
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(1.15) If the board of directors has adopted a policy |
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addressing age eligibility standards on voting, holding |
office, or petitioning the board, then a credit union may |
require (i) that members be at least 18 years of age by the |
date of the meeting in order to vote at meetings of the |
members, sign nominating petitions, or sign petitions |
requesting special meetings, and (ii) that members be at least |
18 years of age by the date of election or appointment in order |
to hold elective or appointive office. |
(2) The board of directors shall appoint from among the |
members of the
credit union, a supervisory committee of not |
less than 3 members at the
organization meeting and within 30 |
days following each annual meeting of
the members for such |
terms as the bylaws provide. Members of the supervisory |
committee may, but need not be, on the board of directors, but |
shall not
be officers of the credit union, members of the |
credit committee,
or the
credit manager if no credit committee |
has been appointed.
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(3) The board of directors may appoint, from among the
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members of the
credit union, a credit committee consisting of |
an odd number, not less than
3 for such terms as the bylaws |
provide. Members of the credit committee
may, but need not be, |
directors or officers of the credit union, but shall
not be |
members of the supervisory committee.
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(4) The board of directors may appoint from among the |
members
of the
credit union a membership committee of one or |
more persons. If appointed,
the committee shall act
upon all |
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applications for membership and submit a report of its actions
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to the board of directors at the next regular meeting for
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review.
If no membership committee is appointed, credit union |
management shall act
upon all applications for membership and |
submit a report of its actions to the board of directors
at the |
next regular meeting for review.
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(5) The board of directors may appoint, from among the |
members of the credit union, a nominating committee of 3 or |
more persons. Members of the nominating committee may, but |
need not, be directors or officers of the credit union, but may |
not be members of the supervisory committee. The appointment, |
if made, shall be made in a timely manner to permit the |
nominating committee to recruit, evaluate, and nominate |
eligible candidates for each position to be filled in the |
election of directors or, in the event of a vacancy in office, |
to be filled by appointment of the board of directors for the |
remainder of the unexpired term of the director creating the |
vacancy. Factors the nominating committee may consider in |
evaluating prospective candidates include whether a candidate |
possesses or is willing to acquire through training the |
requisite skills and qualifications to carry out the statutory |
duties of a director. The board of directors may delegate to |
the nominating committee the recruitment, evaluation, and |
nomination of eligible candidates to serve on committees and |
in executive officer positions. |
(6) The board of directors may create one or more other |
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committees in addition to the committees identified in this |
Section and appoint directors or such other persons as the |
board designates to serve on the committee or committees. Any |
such committee shall serve at the pleasure of the board of |
directors and it shall not act on behalf of the credit union or |
bind it to any action, but it may make recommendations to the |
board of directors. |
(7)(a) The board of directors may appoint an individual as |
a registered agent for the credit union. The name of the |
registered agent appointed by the board of directors shall be |
identified in the annual report filed by the credit union on |
the annual report form supplied by the Department. The |
business office of the registered agent shall be the same as |
the principal place of business of the credit union. Any |
process, notice, or demand required or permitted by law to be |
served upon the credit union may be served upon the registered |
agent appointed by the credit union. |
(b) A credit union that has appointed a registered |
agent shall post on its website the name of its registered |
agent, the address of its principal place of business, and |
that the appointment was authorized by action of the board |
of directors. |
(c) A credit union that has appointed a registered |
agent may change its registered agent at any time by |
posting on its website a statement setting forth the |
following: |
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(i) the address of its principal place of |
business, |
(ii) the name of its existing registered agent, |
(iii) the name of its successor registered agent, |
and |
(iv) that the change was authorized by action of |
the board of directors. |
(d) A registered agent may resign at any time by |
submitting written notice thereof to the credit union at |
its principal place of business. The notice shall set |
forth the following: |
(i) the name of the credit union for which the |
registered agent is acting, |
(ii) the address of the principal place of |
business of the credit union, |
(iii) the name of the registered agent, |
(iv) that the registered agent is resigning, and |
(v) the effective date of the resignation, which |
shall not be less than 30 days after the date of filing |
of the notice. |
(8) (6) The use of electronic records for member voting |
pursuant to this Section shall employ a security procedure |
that meets the attribution criteria set forth in Section 9 of |
the Uniform Electronic Transactions Act. |
(9) (7) As used in this Section, "electronic", "electronic |
record", and "security procedure" have the meanings ascribed |
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to those terms in the Uniform Electronic Transactions Act. the |
(Source: P.A. 102-38, eff. 6-25-21; 102-687, eff. 12-17-21; |
102-774, eff. 5-13-22; 102-858, eff. 5-13-22; revised 8-3-22.)
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(205 ILCS 305/29) (from Ch. 17, par. 4430)
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Sec. 29. Meetings of directors.
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(1) The board of directors and the executive
committee |
shall meet as often as necessary, but one body must meet at |
least
monthly and the other at least quarterly, as prescribed |
in the bylaws.
Unless a greater number is required by the |
bylaws, a majority of the whole
board of directors shall |
constitute a quorum. The act of a majority of
the directors |
present at a meeting at which a quorum is present shall be
the |
act of the board of directors unless the act of a greater |
number is
required by this Act, the credit union's articles of |
incorporation or the
bylaws. |
(1.5) Notwithstanding anything to the contrary in |
subsection (1), the board of directors of a credit union with a |
composite rating of either 1 or 2 under the Uniform Financial |
Institutions Rating System known as the CAMELS supervisory |
rating system (or an equivalent rating under a comparable |
rating system) and a management rating under such composite |
rating of either 1 or 2 may meet not less than 6 times |
annually, with at least one meeting held during each fiscal |
quarter. This meeting frequency schedule shall be available to |
an eligible credit union irrespective of whether it has |
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appointed an executive committee pursuant to Section 28.
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(2) Unless specifically prohibited by the articles of |
incorporation or
bylaws, directors and committee members may |
participate in and act at any
meeting of the board or committee |
through the use of a conference telephone or
other |
communications equipment by means of which all persons |
participating in
the meeting can communicate with each other. |
Participation in the meeting
shall constitute attendance and |
presence in person at the meeting of the person
or persons so |
participating.
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(3) Unless specifically prohibited by the articles of |
incorporation or
bylaws, any action required by this Act to be |
taken at a meeting of the board
of directors or a committee and |
any other action that may be taken at a
meeting of the board of |
directors or a committee may be taken without a
meeting if a |
consent in writing setting forth the action taken is
signed by |
all the directors entitled to vote with respect to the subject |
matter
thereof, or by all
members of the committee, as the case |
may be. The consent shall be evidenced
by one or more written |
approvals, each of which sets forth the action taken and
bears |
the signatures of one or more directors or committee members. |
All the
approvals evidencing the consent shall be delivered to |
the secretary to be
filed in the corporate records of the |
credit union. The action taken shall be
effective when all the |
directors or committee members have approved the consent
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unless the consent specifies a different effective date. A |
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consent
signed by all the directors or all the members of a |
committee shall have the
same effect as a unanimous vote, and |
may be stated as such in any document
filed with the director |
under this Act. |
(4)(a) As used in this subsection: |
"Affiliate" means an organization established to serve |
the needs of credit unions, the business of which relates |
to the daily operations of credit unions. |
"Compliance review documents" means reports, meeting |
minutes, and other documents prepared in connection with a |
review or evaluation conducted by or for the board of |
directors. |
(b) This subsection applies to the board of directors |
in relation to its functions to evaluate and seek to |
improve any of the following: |
(i) loan policies or underwriting standards; |
(ii) asset quality; |
(iii) financial reporting to federal or State |
governmental or regulatory agencies; or |
(iv) compliance with federal or State statutory or |
regulatory requirements, including, without |
limitation, the manner in which it performs its duties |
under Section 30. |
(c) Meetings, minutes of meetings, and reports of the |
board of directors shall be subject to the confidentiality |
and redaction standards set forth in this subsection. |
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(d) Except as provided in paragraph (e), compliance |
review documents and the deliberations of the board of |
directors are confidential. An affiliate of a credit |
union, a credit union
regulatory agency, and the insurer |
of credit union share accounts shall have access to |
compliance review documents; however, (i) the documents |
remain confidential and (ii) delivery of compliance review |
documents to an affiliate or pursuant to the requirements |
of a credit union regulatory agency or an insurer of |
credit union share accounts do not constitute a waiver of |
the confidentiality granted in this Section. |
(e) This Section does not apply to any civil or |
administrative action initiated by a credit union |
regulatory agency or an insurer of credit union share |
accounts. |
(f) This Section shall not be construed to limit the |
discovery or admissibility in any civil action of any |
documents, including compliance review documents. |
(g) Any report required under this Act to be furnished |
to the board of directors by the membership committee, |
credit committee, or any other committee may be submitted |
in a summary format that redacts personally identifiable |
information as defined under applicable State and federal |
law.
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(h) Compliance review documents may be disclosed by |
the Secretary or a credit union to any person or entity to |
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whom confidential supervisory information may be disclosed |
pursuant to subsection (3) of Section 9.1. |
(Source: P.A. 89-603, eff. 8-2-96.)
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(205 ILCS 305/48) (from Ch. 17, par. 4449)
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Sec. 48. Loan limit. Within any limitations set forth in a |
policy adopted by the board of directors, a credit union may |
place a limit upon the aggregate
amount to be loaned to or |
cosigned for by any one member provided that no loan shall be |
made to any
member in an aggregate amount in excess of 10% of |
the credit union's
unimpaired capital
and surplus. Such loan |
limits shall not be subject to reduction by rules adopted by |
the Secretary.
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(Source: P.A. 100-361, eff. 8-25-17.)
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Section 99. Effective date. This Act takes effect upon |
becoming law.
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