Bill Text: IL HB4865 | 2009-2010 | 96th General Assembly | Enrolled

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Bill Title: Amends the Illinois Credit Union Act. In provisions concerning the meeting of members, provides that a proxy may be revoked by a written statement to that effect, by execution of a subsequently-dated proxy, or by attendance at a meeting and voting in person. Effective immediately.

Spectrum: Moderate Partisan Bill (Democrat 4-1)

Status: (Passed) 2010-07-02 - Public Act . . . . . . . . . 96-0963 [HB4865 Detail]

Download: Illinois-2009-HB4865-Enrolled.html

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AN ACT concerning financial regulation.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Credit Union Act is amended by
changing Sections 19 and 34 as follows:
(205 ILCS 305/19) (from Ch. 17, par. 4420)
Sec. 19. Meeting of members.
(1) The annual meeting shall be held each year during the
months of January, February or March or such other month as may
be approved by the Department. The meeting shall be held at the
time, place and in the manner set forth in the bylaws. Any
special meetings of the members of the credit union shall be
held at the time, place and in the manner set forth in the
bylaws. Unless otherwise set forth in this Act, quorum
requirements for meetings of members shall be established by a
credit union in its bylaws. Notice of all meetings must be
given by the Secretary of the credit union at least 7 days
before the date of such meeting, either by handing a written or
printed notice to each member of the credit union, by mailing
the notice to the member at his address as listed on the books
and records of the credit union, or by posting a notice of the
meeting in three conspicuous places, including the office of
the credit union.

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(2) On all questions and at all elections, except election
of directors, each member has one vote regardless of the number
of his shares. There shall be no voting by proxy except on the
election of directors, proposals for merger or voluntary
dissolution. All voting on the election of directors shall be
by ballot, but when there is no contest, written ballots need
not be cast. The record date to be used for the purpose of
determining which members are entitled to notice of or to vote
at any meeting of members, may be fixed in advance by the
directors on a date not more than 90 days nor less than 10 days
prior to the date of the meeting. If no record date is fixed by
the directors, the first day on which notice of the meeting is
given, mailed or posted is the record date.
(3) Regardless of the number of shares owned by a society,
association, club, partnership, other credit union or
corporation, having membership in the credit union, it shall be
entitled to only one vote and it may be represented and have
its vote cast by its designated agent acting on its behalf
pursuant to a resolution adopted by the organization's board of
directors or similar governing authority; provided that the
credit union shall obtain a certified copy of such resolution
before such vote may be cast.
(4) A member may revoke a proxy by delivery to the credit
union of a written statement to that effect, by execution of a
subsequently dated proxy, or by attendance at a meeting and
voting in person.

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(Source: P.A. 89-603, eff. 8-2-96.)
(205 ILCS 305/34) (from Ch. 17, par. 4435)
Sec. 34. Duties of Supervisory Committee.
(1) The Supervisory Committee shall make or cause to be
made an annual internal audit of the books and affairs of the
credit union to determine that the credit union's accounting
records and reports are prepared promptly and accurately
reflect operations and results, that internal controls are
established and effectively maintained to safeguard the assets
of the credit union, and that the policies, procedures and
practices established by the Board of Directors and management
of the credit union are being properly administered. The
Supervisory Committee shall submit a report of that audit to
the Board of Directors and a summary of that report to the
members at the next annual meeting of the credit union. It
shall make or cause to be made such supplementary audits as it
deems necessary or as are required by the Director or by the
Board of Directors, and submit reports of these supplementary
audits to the Director or Board of Directors as applicable. If
the Supervisory Committee has not engaged a public accountant
registered by the Department of Professional Regulation to make
the internal audit, the Supervisory Committee or other
officials of the credit union shall not indicate or in any
manner imply that such audit has been performed by a public
accountant or that the audit represents the independent opinion

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of a public accountant. The Committee must retain its tapes and
working papers of each internal audit for inspection by the
Department. The report of this audit must be made on a form
approved by the Director. A copy of the report must be promptly
mailed to the Director.
(2) The Supervisory Committee shall make or cause to be
made at least once each year a reasonable percentage
verification of members' share and loan accounts, consistent
with rules promulgated by the Director.
(3) The Supervisory Committee of a credit union with assets
of $5,000,000 or more shall engage a public accountant
registered by the Department of Professional Regulation to
perform an annual external independent audit of the credit
union's financial statements in accordance with generally
accepted auditing standards. The Supervisory Committee of a
credit union with assets of $3,000,000 or more, but less than
$5,000,000, shall engage a public accountant registered by the
Department of Professional Regulation to perform an external
independent audit of the credit union's financial statements in
accordance with generally accepted auditing standards at least
once every 3 years. A copy of an external independent audit
shall be completed and mailed to the Director no later than 90
days after December 31 of each year; provided that a credit
union or group of credit unions may obtain an extension of the
due date upon application to and receipt of written approval
from the Director upon completion. If the annual internal audit

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of such a credit union is conducted by a public accountant
registered by the Department of Professional Regulation and the
annual internal audit is done in conjunction with the credit
union's annual external audit, the requirements of subsection
(1) of this Section shall be deemed met.
(4) In determining the appropriate balance in the allowance
for loan losses account, a credit union may determine its
historical loss rate using a defined period of time of less
than 5 years, provided that:
(A) the methodology used to determine the defined
period of time is formally documented in the credit union's
policies and procedures and is appropriate to the credit
union's size, business strategy, and loan portfolio
characteristics and the economic environment of the areas
and employers served by the credit union;
(B) supporting documentation is maintained for the
technique used to develop the credit union loss rates,
including the period of time used to accumulate historical
loss data and the factors considered in establishing the
time frames; and
(C) the external auditor conducting the credit union's
financial statement audit has analyzed the methodology
employed by the credit union and concludes that the
financial statements, including the allowance for loan
losses, are fairly stated in all material respects in
accordance with U.S. Generally Accepted Accounting

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Principles, as promulgated by the Financial Accounting
Standards Board.
(5) A majority of the members of the Supervisory Committee
shall constitute a quorum.
(Source: P.A. 96-141, eff. 8-7-09.)
Section 99. Effective date. This Act takes effect upon
becoming law.