Illinois Department of Financial & Professional Regulation Illinois Department of Financial & Professional Regulation
Bryan A. Schneider, Secretary  
Bruce Rauner, Governor
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1990 - 1999 Interpretive Letters

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  • BCA means Business Corporation Act
  • BIA means Banking on Illinois Act
  • BSCA means Bank Service Corporation Act
  • CCIA means Credit Card Issuance Act
  • CDAA means Consumer Deposit Account Act
  • CFA means Corporate Fiduciary Act
  • CILA means Consumer Installment Loan Act
  • CPCNA means Check Printer and Check Number Act
  • EFTA means Electronic Fund Transfer Act
  • EFTTFA means Electronic Fund Transfer Transmission Facility Act
  • FBOA means Foreign Banking Office Act
  • FBROA means Foreign Bank Representative Office Act
  • IA means Interest Act
  • IBA means Illinois Banking Act
  • IBHCA means Illinois Bank Holding Company Act of 1957
  • IFSDA means Illinois Financial Services Development Act
  • IIC means Illinois Insurance Code
  • IUIA means Illinois Unemployment Insurance Act
  • LLCA means Limited Liability Company Act
  • PA means Probate Act
  • PRA means Pawnbroker Regulation Act
  • SBA means Savings Bank Act
  • SFAA means Securities in Fiduciary Accounts Act
  • SLA means Savings and Loan Act of 1985
  • TIA means Title Insurance Act
  • TTA means Trust and Trustees Act
  • UCC means Uniform Commercial Code
  • ULPA means Uniform Limited Partnership Act

* Interpretive Letter superseded or made obsolete by statutory or regulatory changes

Letter Number Date
Sections of Acts Construed Description
90-01 01-03-90 15(3) and 17 IBA State bank must amend its charter in order to eliminate cumulative voting rights.
90-02 01-29-90 32 IBA Loans to corporation guaranteed by individual will not be aggregated with loans to individual and to partnership in which individual is general partner.
90-03 01-30-90 5(15) IBA Transfer of funds using personal computer home banking service is not branch banking.
90-04 02-07-90 33 IBA, 5(1) TTA State bank may not invest in certificates in closed-end investment company that are not "readily marketable."
90-05 02-20-90 23 IBA Written notice must be given to shareholders of state bank at least 30 days prior to any meeting at which a vote on a merger will take place.
90-06 02-26-90 46 IBA Business may not use the term "merchant bank" in its corporate name if such use may mislead the public.
90-07 04-11-90 35(1) and 35(3) IBA State bank may factor account receivables due from the U.S. Government with respect to any one contractor without limitation.
90-08 05-22-90 32 IBA, 303(a) ULPA Loan to individual is not aggregated with loan to limited partnership of which individual is a limited partner.
90-09 05-30-90 16(2) IBA Shareholders of state bank may fix number of directors by two-thirds affirmative vote at any meeting called for that purpose.

(90-10 rescinded and superceded by 2002-07)
06-29-90 5(11) and 35(3) IBA State bank is authorized to purchase stock in and become a member of a Federal Home Loan Bank to the same extent as a national bank.
90-11 07-30-90 18 IBA Employee Stock Ownership Plan that acquires more than 20% outstanding stock of a bank holding company that controls a state bank must file a change of control application.
90-12 08-03-90 5(13) IBA State bank may automatically renew letters of credit, even though it may only accept drafts for payment up to one year from date of acceptance.
90-13 08-08-90 5(5) and 33 IBA State bank may establish a deferred compensation plan for the benefit of senior bank officers and fund the plan with life insurance contracts without regard to investment limitations.
90-14 08-08-90 IBA *
90-15 08-22-90 16 IBA Board of state bank may operate with five directors notwithstanding that stockholders fixed number of directors at six.
90-16 08-22-90 34(5) IBA State bank may accept assignment of letters of credit issued by affiliated bank as security for loans without regard to lending limits.
90-17 09-04-90 5(15) and 31 IBA *
90-18 09-13-90 16 IBA State bank may appoint director emeritus or advisory director who does not vote and performs only advisory functions.
90-19 09-14-90 5(5) and 33 IBA State bank may purchase insurance contracts for legitimate insurance purposes but not for investment purposes.
90-20 10-12-90 32 IBA State bank that has second mortgage may purchase title to real estate at foreclosure sale, but may not purchase first mortgage prior to foreclosure if aggregate of loans would exceed lending limits.
90-21 10-19-90 5(16) IBA State bank may deploy a mobile ATM that will operate within the bank's home county and contiguous counties.
90-22 10-25-90 5(12) IBA State bank may form subsidiary to hold title to assets acquired in foreclosure; Commissioner will waive 60 day notice period in extenuating circumstances.
90-23 11-14-90 FBROA National bank located outside of Illinois may offer unsecured lines of credit at its licensed representative office.
90-24 12-10-90 5(15) and 13(d) IBA *
90-25 12-14-90 5(21) IBA State bank may invest in joint venture to expand industrial park as a project that promotes development of the community and its welfare.
91-01 01-10-91 5(7) IBA State bank may not pledge its assets to secure the deposits of its customers, unless the deposits are public funds.
91-02 01-23-91 3 IBA University's use of debit card system for its students is not "general banking business."
91-03 02-11-91 15(8) IBA Person who is not a bank shareholder is not entitled access to the bank's shareholder list.
91-04 02-26-91 5(7) IBA State banks may collateralize deposits of grantees of public agencies if the deposited grants are public funds that remain under some control of the public agency.
91-05 03-02-91 2, 5(21), 33, 34 and 35 IBA State banks are authorized to invest in marketable investment securities, projects designed to promote the development of a community and its welfare, and collateralized mortgage obligations, subject to the criteria and limitations set forth in the Illinois Banking Act.
91-06 03-14-91 5(7) IBA Illinois Banking Act does not impose restrictions on state banks as to the type, identification or segregation of assets pledged to secure public funds.
91-07 03-21-91 48.3 IBA Commissioner may share examination report of an Illinois bank with out-of-state bank regulator who has a legitimate regulatory interest.
91-08 04-11-91 33 IBA Universal life insurance policy that lists chairman of board as owner and chairman's sons as beneficiaries is not a permissible investment.
91-09 04-19-9 2 and 47 IBA Quarterly call report must be published in newspaper of general circulation that is published at least weekly and has been in business for at least one year prior to first call report publication.
91-10 05-02-91 32(3) IBA State bank may correct technical deficiency by obtaining appraiser's oath for one of two required appraisals in order for loan to be qualified real estate loan.
91-11 05-23-91 35(7) IBA Certificate of deposit in lending bank that is pledged as collateral for a loan may be used as a segregated deposit account for purposes of the lending limit exemptions.
91-12 06-10-91 4-4 CFA, FBROA, 2 IBA Foreign bank representative office that solicits customers for loan, deposit and investment products, but does not accept deposits or make loans, is not engaged in the business of banking.
91-13 06-24-91 5(12) IBA, 2 and 3.05 IBHCA State bank may establish limited purpose national bank which will not accept deposits or pay checks as an operating subsidiary to conduct credit card operations.
91-14 07-08-91 5(15) and 31 IBA *
91-15 07-08-91 17 IBA *
91-16 07-12-91 8.75 BCA, 5(19) and 39 IBA State banks may indemnify officers, directors, employees and agents to same extent that corporations are so authorized; provided, however, state banks may not indemnify directors and officers for those acts for which the Illinois Banking Act imposes personal liability.
91-17 07-25-91 3 FBROA, 2 IBA Out-of-state bank may establish a loan production office in Illinois to perform representational functions, including the solicitation of deposits, if it obtains a license under the Foreign Bank Representative Office Act.
91-18 07-31-91 34(3) and 35(4) IBA Investments in "alternate bonds" that are supported by the full faith and credit of a municipality located in the county in which the state bank is located are exempt from investment limits.
91-19 08-06-91 2, 5(15), 5(16) and 5(17) IBA Automatic teller machines are not branches for purposes of home office protection.
91-20 08-28-91 32, 33, 34 and 35 IBA Loans collateralized by hospital or nursing home's assignment of rights to Medicaid payments qualify for exceptions and exemptions from lending limits under Section 34 and may also qualify under Section 35.
91-21 09-04-91 FBROA, 2 IBA Illinois state bank may establish an in-state loan production office without prior approval from Commissioner.
91-22 09-12-91 3 and 13 FBOA, 5(9) and 5(12) IBA Foreign bank may establish a non-bank subsidiary to hold title to and administer property obtained in collection of a debt.
91-23 09-13-91 2 and 5(15) IBA National bank contract with armored car service to count cash, currency and food stamps at armored car company's processing center for bank customers is not a violation of state branching restrictions if deposits are credited when received by bank.
91-24 09-16-91 5(15)(g) IBA *
91-25 09-19-91 3 IBA State bank's incidental powers include the authority to contribute to bank trade association's building fund.
91-26 09-30-91 19.1 IBA Date of bank charter resulting from conversion of trust company is date of certificate of authority issued to predecessor trust company.
91-27 10-28-91 5(9) and 14(8) IBA State bank may transfer ORE to its bank holding company as a dividend in order to comply with divestiture rules.
91-28 10-28-91 3.071 IBHCA *
91-29 10-30-91 6 and 7 CCIA *
91-30 11-04-91 16 IBA When state bank has less than five directors, at least one director may not be an officer or employee of bank.
91-31 11-25-91 2 and 35(4) IBA Loan to fire protection district backed by full faith and credit of district is a general obligation of a municipality that is exempt from lending limits.
91-32 12-05-91 2, 5(12) and 5(21) IBA National bank may invest in a development credit corporation that makes loans for its own account without violating branching laws.
91-33 12-11-91 3 and 5(8) IBA State bank that is owned by foreign corporation may purchase a residence for use by bank personnel temporarily assigned to Illinois.
91-34 12-12-91 32 IBA State bank that has made a commercial real estate loan in the amount of its lending limit may redeem the property for delinquent taxes and such expenditures will be deemed a liability "otherwise" extended for purposes of Section 32.
91-35 12-23-91 2-1 and 2-4 CFA, 13 CILA, 3 and 16(7) IBA Trust department of state bank and its officers may act under a power of attorney that encompasses property and financial matters.
92-01 02-21-92 5(16) IBA National bank may establish ATM on riverboat so long as ATM remains within confines of bank's home or contiguous counties.
92-02 04-17-92 21 CILA, 4 and 4(a) IA State bank may charge late charges pursuant to Section 4a of Interest Act or may elect to make a loan of less than $10,000 under the Consumer Installment Loan Act and comply with the provisions of that Act.
92-03 04-24-92 5(15) and 44.1 IBA State bank that establishes a banking facility at senior citizen's or long term care facility is not required to file Notice of Intent to Branch with Commissioner.
92-04 05-14-92 2 and 5(15) IBA State bank may operate a depository receptacle that is accessible through an ATM, but may not operate a stand-alone, off-premises depository receptacle.
92-05 05-14-92 5(11) and 5(12) IBA State banks are authorized to purchase stock issued by the Federal Home Loan Mortgage Corporation and the Student Loan Marketing Corporation.
92-06 05-19-92 18 IBA Solicitation and receipt of revocable written proxies do not constitute a change of control.
92-07 06-22-92 48.1 and 48.3 IBA Examination report that includes bank customers' names or loan accounts is not a financial record of such customers, and bank is not authorized to notify specific customers of subpoena for examination report.
92-08 06-24-92 6 and 7 CCIA *
92-09 06-24-92 6 and 7 CCIA *
92-10 08-19-92 8-101 and 8-104(1) EFTA ATM that accepts commercial deposits may be
92-11 08-20-92 17 IBA Infusion of funds directly into surplus without issuance of stock or change in par value does not require a charter amendment.
92-12 08-28-92 1-6 CFA, 5 TTA Corporate fiduciary may engage in securities lending for personal trust accounts if appropriate policies and safeguards are implemented, unless prohibited by the trust instrument.
92-13 09-03-92 32 IBA Loans to individuals guaranteed by their corporation are each subject to the lending limit applicable to individuals, while the corporation's guarantees are aggregated for purposes of the limit on a state bank's total liabilities.
92-14 09-15-92 21 CILA, 4a IA State bank that chooses to operate under the Consumer Installment Loan Act (CILA) in order to collect the charges permitted under CILA must comply with the disclosure provisions for Rule of 78ths.
92-15 09-17-92 33 and 34 IBA Marketable investment securities must be rated on a per issue basis; rating requirements do not apply to general obligations issued by municipalities and other public agencies.
92-16 10-26-92 6-106 EFTA, 5(12), 5(16) and 5(17) IBA State bank may invest in stock in Delaware corporation that operates an electronic funds transfer network.
92-17 12-08-92 5(11) and 32 IBA Earn-out portion of sale of state bank subsidiary financed by selling bank is not subject to Section 32 lending limits, provided sale is performed in commercially reasonable manner that minimizes risk to bank in event purchaser defaults.
92-18 12-22-92 5, 16, 33, 34 and 35 IBA State bank may delegate its discretionary investment authority to unaffiliated third party, provided bank adopts certain oversight procedures and values securities at lesser of cost or market value.
93-01 02-03-93 4-2, 4-4 and 4-5 CFA, 2 and 3 FBROA National bank with principal office outside of Illinois may establish trust representative office in Illinois to perform limited representative functions.
93-02 02-09-93 2 and 32 IBA State bank using push down accounting should not subtract value of unamortized fixed assets and investments from surplus in calculating lending limits.
93-03 02-11-93 48.1 IBA Federal law that prohibits bank from disclosing subpoena requesting customer's financial records preempts state law that requires bank to mail copy of subpoena to customer.
93-04 02-24-93 5(4), 5(15) and 48 IBA State bank's appointment of out-of-state banks as agents to issue and pay certificates of deposit does not constitute the establishment of branches.
93-05 04-23-93 2 IBA, 3.05 and 3.071 IBHCA Out-of-state bank holding company may form a de novo Illinois chartered bank to acquire the assets and liabilities of a financial institution in default or in danger of default.
93-06 04-27-93 8-104 EFTA *
93-07 04-29-93 2 and 5(16) IBA *
93-07.1 07-02-93 5(8) IBA State bank is authorized to acquire real estate to swap for property to be used as bank premises.
93-08 07-02-93 18 IBA Out-of-state bank holding company does not have to file a change in control or interstate application when it changes its state of incorporation by merger.
93-09 07-02-93 5(8) IBA State bank may purchase real estate for use as employee parking lot.
93-10 07-06-93 48.1 IBA *
93-11 07-15-93 33, 34 and 35 IBA Tax increment financing bonds are not general obligations of the issuing municipality and are subject to Section 33 investment limits.
93-12 07-22-93 5(14), 32, 33, 35 and 35.1 IBA State bank may acquire and lease personal property to county hospital, subject to 20% investment limit; exceptions and exemptions to lending limit in Sections 34 and 35 of Illinois Banking Act do not apply to personal property leases made under Section 35.1 of Act.
93-13 07-30-93 32 IBA, 3-419 UCC Lending limits applicable to aggregate guarantees are determined by the forms of the guarantees; guarantees of payment are limited to 20% of unimpaired capital plus 20% of unimpaired surplus, calculated separately from the lending limit; guarantees of collection are limited to 25% of deposits, but may not be more than 50% of unimpaired capital and surplus, calculated by adding such guarantees together with all other liabilities of the guarantor to the bank.
93-14 08-04-93 32(3) IBA Bank officer who is certified appraiser may not prepare appraisal for qualified real estate loans.
93-15 08-24-93 2, 5(23) IBA A savings and loan association or savings bank that is at least 80% owned by a bank holding company is a "bank" for purposes of acting as an "affiliate facility."
93-16 09-24-93   Bank holding company that acquires 100% of second bank holding company must use push down accounting.
93-17 10-14-93 2 and 8 IBA, 3.05 IBHCA Proposed bank holding company may not be an incorporator of an interim state bank.
93-18 10-18-93 16(4) IBA *
93-19 10-21-93 33, 34 and 35 IBA Investments in general obligations of municipalities located in bank's county are not subject to investment limits; investments in revenue bonds secured by obligations of State of Illinois are limited to 50% of bank's unimpaired capital and surplus.
93-20 10-27-93 3.05 and 3.10 BCA, 2 and 46 IBA Corporation that only provides equipment financing to other corporations is not doing a general banking business.
93-21 10-28-93 32 IBA, 3-419 UCC For determination of lending limits, language of guarantee must clearly identify guarantee as one of collection or guarantee will be deemed a guarantee of payment.
93-22 10-28-93 33 IBA Non-rated bonds issued by a public agency are a permitted investment; definition of "public agency."
93-23 11-05-93 3.071 IBHCA *
93-24 11-29-93 3 IBA State banks may offer involuntary unemployment insurance coverage to their borrowers in the same manner that they may offer credit life insurance and credit accident/health insurance.
93-25 12-10-93 2, 5(14), 34, 35 and 35.1 IBA School district is a "person" for purposes of the leasing authority granted by Section 35.1 of the Banking Act.
93-26 12-15-93 32 and 35 IBA Portion of loan collateralized by deposit account of guarantor is exempt from lending limits; limit applicable to aggregate guarantees depends on the form of the guarantees.
93-27 12-15-93 5(11), 32, 35 and 35.1 IBA State bank may own and lease real property and personal property to a municipality, subject to the same restrictions applicable to a national bank.
93-28 12-16-93 35.2 IBA Loans secured by bank holding company stock are "covered transactions" that are aggregated for lending limit purposes.
93-29 12-16-93 6, 7 CCIA *
93-30 12-21-93 5(11) IBA Bank may retain corporate stock received as dividends from investment in "small business investment company."
93-31 12-21-93 35.2 IBA Loans among affiliates, the stock of which is at least 80% owned by parent company, are exempt from lending limit and collateral requirements.
93-32 12-22-93 2, 5(15) and 5(16) IBA Illinois Banking Act does not prohibit establishment of mobile branches, but applicable branch applications and notices may be required for each change in location; mobile ATMs are permitted.
94-01 01-20-94 6 and 7 CCIA *
94-02 01-28-94 8-103 EFTA Placement of proprietary message on ATM screen that can be accessed only by customers of the establishing bank does not violate prohibition against proprietary advertising on the ATM terminal.
94-03 03-14-94 13(a) IBA *
94-04 03-23-94 3, 5(7)(a) and 44.1 IBA State bank that assists residents of senior citizens centers and nursing homes on a limited basis is not establishing branches; state bank is authorized to purchase guaranty bonds to secure excess deposits.
94-05 04-12-94 4a, 4(2)(b) IA Finance company may offer installment loans and retail installment loans with variable interest rates for resale to Illinois banks, subject to requirement that payments are made in periodic equal amounts.
94-06 05-02-94 32 IBA Loan to limited partnership is not aggregated with other loans to general partner of limited partnership if lending bank's recourse is limited to the assets of the limited partnership by the loan documents.
94-07 05-04-94 4-4 CFA Out of state banks are not permitted to establish offices for the conduct of business as corporate fiduciaries in Illinois.
94-08 05-25-94 5(9) IBA Other real estate owned ("OREO") that is subject to a lease must still be accounted for as OREO for regulatory reporting purposes.
94-09 05-25-94 5(2) TTA Corporate fiduciary may invest trust assets in a mutual fund for which it performs services and from which it receives fees provided that the trust instruments permit such an investment, the fees are reasonable, disclosure is made to the trust beneficiaries, and such an investment complies with ERISA, if applicable.
94-10 06-15-94 2 and 5(15) IBA State bank may establish as branches stand-alone night receptacles in malls and in mall parking lots that are not connected to or otherwise near an ATM or other facility and are accessible only to bank's customers.
94-11 06-15-94 3 and 5(11) IBA State bank may offer debt cancellation agreements to its customers as incidental to its authority to loan money and carry on a general banking business and under the authority of Section 5(11).
94-12 06-30-94 3.071 IBHCA *
94-13 07-27-94 3 IBA State bank may offer guaranteed asset protection plans to car loan customers because such plans are similar to debt cancellation agreements that have been determined as incidental and germane to the business of banking.
94-14 08-27-94 1b CCIA State bank that complies with the requirements of the Federal Equal Credit Opportunity Act when issuing credit cards does not have to make the additional disclosures set forth in Section 1b of the Credit Card Issuance Act.
94-15 08-26-94 2-4 CFA, 3 FBOA, 3, 4 and 5(11) IBA A foreign banking corporation that possesses a certificate of authority under the Foreign Banking Office Act may apply for a certificate of authority to accept and execute trusts under the Corporate Fiduciary Act.
94-16 09-01-94 4-2, 4-4 and 4-5 CFA An Indiana trust company may perform representative services at a representative office in Illinois, but may not establish a place of business in Illinois to conduct business as a fiduciary.
94-17 09-01-94 2-4 CFA State bank that acts as a bond registrar is conducting business as a fiduciary and must have a certificate of authority to accept and execute trusts.
94-18 09-02-94 32(3) IBA Higher lending limit under Section 32(3) for qualified real estate loans is not available for the purchase of a participation if both appraisals are not obtained at the time the loan is made or refinanced.
94-19 09-15-94 3 and 5(11) IBA, 3 FBOA Bank may trade energy derivatives for its customers, provided it has the management and controls necessary to ensure safe and sound banking practices.
94-20 09-22-94 2, 47 IBA Bank may publish its quarterly call reports in any newspaper of general circulation in the community in which the bank is located.
94-21 10-04-94 4, 4a IA State banks may contract for and receive interest and charges at any agreed upon rate.
94-22 10-04-94 35.2IBA Transactions between affiliates that are at least 80% commonly owned are not subject to the limitations set forth in Section 35.2 if conducted in a safe and sound manner and do not involve purchase of low quality assets.
94-23 10-19-94 5(4), 5(5) and 5(8) IBA State bank may not purchase and hold a vacation home for the use of senior executive officers in a non-qualified employee benefit trust.
94-24 11-01-94 5(11) and 33 IBA State bank may purchase and hold non-rated marketable investment securities under the authority of Section 5(11), subject to the standards and limitations applicable to a national bank for the type of investment, notwithstanding the limitations in Section 33.
94-25 12-01-94 2 IBA State bank may establish a deposit courier service provided it complies with the requirements for a branch, or customers may use an independent third party to provide the service.
95-01 03-02-95 5(11) IBA State bank is authorized to purchase the residence of an employee who has been transferred to another area, provided that the bank divests ownership of the property as soon as practicable.
95-02 04-19-95 5(5) and 33 IBA State bank is not authorized to retain life insurance policy on life of retired director once legitimate insurance need is eliminated.
95-03 06-06-95 48 IBA, 100 IUIA Illinois Department of Employment Security may visit state bank despite exclusive visitation provision of Section 48 solely for purpose of verifying unemployment tax records.
95-04 07-12-95 3.071 IBHCA *
95-04a 09-8-95 3.071 IBHCA *
95-05 07-28-95 3.071 IBHCA *
95-06 08-01-95 2 and 32 IBA State bank may repurchase portions of a loan participation that the bank had sold provided the amount of the loan held on its books complies with the current statutory limit.
95-07 08-29-95 5 IBA, 3 FBOA Risk participations in a loan between branches of the same foreign bank do not constitute an unauthorized guarantee of another bank's loan.
95-08 09-13-95 4a(b) & 4.1a(b) IA Service charges in addition to interest on simple interest loans for more than $800 are not limited by Section 4a(b) of the Interest Act which limits changes on loans that are less than $800.Section 4.1a(b) permits banks to collect bad check charges.
95-09 9-27-95 2 SFAA A corporate fiduciary may not deposit fiduciary account securities with a broker pursuant to the Securities in Fiduciary Accounts Act unless that broker is organized and qualified to accept and execute trusts or the trust instrument directs such a deposit.
95-10 10-02-95 10-10 LLCA32 IBA A loan to a limited liability company is not aggregated with individual borrowings of a company member unless the bank is actually looking to the member for repayment.
95-11 10-27-95 1-6 CFA, 4.01 and 4.21 TTA, 2 IBA, 3.10 BCA An Illinois trust company may deal with trust owned farm real estate as trustee or may engage in farm real estate management and brokerage in an agency capacity according to Illinois law.
95-12 11-21-95 2-4 CFA A common law assignee for the benefit of creditors, whether court supervised or not, is not required to obtain a certificate of authority from the Commissioner to act as such in Illinois.
95-13 12-19-95 16, 48.1 and 48.3 IBA When the boards of a bank holding company, of the lead bank subsidiary of the bank holding company, and of an affiliated bank holding company are all composed of the identical individuals, and the boards conduct a common meeting for the affiliated entities, then consolidated minutes of such meeting may be kept.
95-14 12-19-95 8 IBA Incorporators of an Illinois state bank in organization may, to satisfy the requirement of Section 8, subscribe to stock of the bank or stock of the corporation formed to be the bank holding company of the bank.
95-15 12-20-95 3 FBOA Foreign banks that possess certificates under Foreign Banking Office Act have the same powers as state banks which in turn have the same powers as national banks to own, hold or trade financial derivatives. Commissioner may still require prior approval.
96-01 01-24-96 3,4,6 IFSDA State bank's home equity line of credit is a revolving credit plan pursuant to the Financial Services Development Act (IFSDA). Early Cancellation Fee is a "charge which may be provided in the agreement between the Bank and customer. Interest Act provisions do not limit revolving credit plans pursuant to IFSDA.
96-02 03-18-96 5(11) IBA Purchases of stock in the Federal National Mortgage Association ("FNMA") are not subject to investment limits. However, the Agency may still have safety and soundness concerns based on concentrations or lack of diversification of the bank's investments.
96-03 06-24-96 35 EFT Financial institution's main office may be directly connected to a different switch than the switch used by one or more of its branches, although each banking office may only be directly connected to one switch.
96-04 08-14-96 5(6), 5(21) IBA Bank may conduct activity as an Internet Service Provider if the activity is undertaken for the enhancement and support of community development and to enrich the lives and educational opportunities for bank customers and community residents.
96-05 08-27-96 5.2 TTA, 21-2.14, 21-1.07 PA Under Illinois law, an Illinois corporate fiduciary may invest trust assets in a mutual fund from which it receives fees for the provision of administrative services without creating an impermissible conflict of interest.
96-06 10-03-96 3 & 5(12) IBA, 10-10(a) LLCA State bank may make minority equity investment in limited liability company, corporation or partnership pursuant to conditions outlined.
96-07 12-04-96 5(17) IBA, 30 EFTA ATM's which only dispense cash may be established in Illinois at any location and by any establisher.
97-01 01-21-97 5(3), 5(5), 5(11) IBA State Bank may provide tax preparation services to its customers or the public, but the Bank may not act as an expert tax consultant, and should take appropriate precautions to inform customers for the service of this fact.
97-02 03-11-97 5, 5(11) IBA State Bank may accept and hold stock issued by a borrower, not as an investment per se, but rather as an incident to an attempt to work out a problem loan and maximize the bank's recovery.
97-03 03-24-97 1 et seq. TIA, 1-1 et seq. CFA, 4.01-4.24 TTA, 499.1 IIC Acting as agent for sale of title insurance is permitted for Illinois state chartered trust company; title insurance agent is not engaged in the "insurance business;" therefore, trust company is not prohibited from acting as title insurance agent by Sec. 499.1 of the Illinois Insurance Code.
97-04 07-09-97 0.01 et seq., 4(2)(a), 6IA Retroactively charging higher interest rates to borrowers who prepay their mortgage loans whose interest rate is over 8% would constitute a prohibited prepayment penalty under Section 4(2) (a) of the Interest Act. However, banks may provide incentives, such as cash bonuses and fee waivers, to induce borrowers not to prepay.
97-05 07-10-97 5/2, 5/3 IBA Illinois state-chartered banks may provide temporary banking services at colleges or universities. These would include opening checking and savings accounts, soliciting applications for credit cards, ad providing information on other bank services and locations. So long as the bank does not receive deposits, pay checks, or make loans, the service would not be considered a branch and would not need to file an application or notice with the agency.
97-06 10-16-97 1-5.05, 8-2 CFA An Illinois corporate fiduciary may deal with trust owned farm real estate as trustee or may engage in farm real estate management and brokerage in an agency capacity.
98-01 01-16-98 4(1)(1), 4a(a)(i) IA Loans secured by a real estate mortgage are governed by Section 4(1)(1), and not Section 4a(a)(i), of the Interest Act.
98-02 04-09-98 16(2), 16(3), 43 IBA Shareholders of bank have sole authority to change the number of members on the bank's board of directors.  The board may only exercise authority to appoint a new director prescribed in the by-laws if the vacancy on the board arose between shareholder meetings.
98-03 05-06-98 5(9) IBA If a bank merges with another bank and thereby acquires title to the other bank's residual other real estate owned ("OREO"), the 10 year OREO holding timetable is reset.  Furthermore, the Office of Banks and Real Estate no longer has the authority to grant extensions for banks to hold OREO.
98-04 05-26-98 2 IBA For a banking facility to be considered a branch, it must engage in one of the core banking functions, must be established by the bank, and must be accessible to the public, giving the bank a competitive advantage in obtaining customers.
98-05 06-25-98 32 IBA If a bank makes a loan which is guaranteed by various guarantors and a portion of the loan is subsequently participated to another bank, the guarantees would follow the loan on a pro rata basis.
98-06 07/20/98 1 PRA The phrase, "other than property the ownership of which is subject to a legal dispute" in Section 1 of the Pawnbroker Regulation Act [205 ILCS 510/1] means that if a pawnbroker has actual knowledge that there is a dispute about the ownership of an item, that pawnbroker may not accept such an item for pawn.   Furthermore, those who deal in the purchase of property on the condition of selling the property back again at a stipulated price are included in the definition of "pawnbroker".
98-07 07/22/98 2 CDAA,
A check printer may use the next consecutive check number indicated by the account holder's current check supply when filing an order for a customer.  A check printer who is unable to determine the date on which an account was opened shall use the date of the earliest transaction or the earliest order of checks for the account that can be verified.  The status of the financial institution in which the account is held, rather than the residency of the account holder, shall determine whether the check printer must comply with the verification requirements of the Check Printer and Check Number Act.
98-08 08/25/98 44.1 IBA The provision of basic banking services, including check cashing, deposit transactions, and statement reconciliation on a limited basis to residents of a retirement apartment complex is authorized by Section 44.1 of the Illinois Banking Act and does not constitute the establishment of a branch by the bank.
98-09 09/08/98 3, 5(11), 5(24), 5(25) IBA, 1 et seq. TIA, 1402 IIC State banks may sell title insurance, subject to licensure by the Illinois Department of Financial Institutions.
98-10 09/08/98 5(25) IBA, 6003(7) SBA State banks may engage in real estate development activities or projects, subject to the same restrictions that apply to insured savings associations.  State banks' real estate development authority may have to be conducted through a subsidiary with the approval of the FDIC.
98-11 09/08/98 5(25) IBA, 1008(a)(18) SBA, 12 USC 1861 et seq. BSCA State banks may offer data processing and data transmission services on a for-profit basis either directly, through a subsidiary or through a bank service corporation.
98-12 09/08/98 5(25) IBA, 1008(a)(13)(B) SBA State Banks may pledge assets to secure private deposits.
98-13 09/29/98 1 PRA An establishment that purchases jewelry from an individual for refurbishing and reselling is not acting as a pawnbroker for purposes of the Pawnbroker Regulation Act if there is no condition or agreement that the establishment resell the property to that same individual at a stipulated price.
98-14 09/29/98 5 & 15 CPCNA The verification requirements in the Check Printer and Check Number Act ("Act") do not apply to check orders (1) drawn on existing consumer deposit accounts for which the check printer has previously filled an order and to which there are no changes, (2) originating from the financial institution in which the consumer deposit account is held, and (3) drawn on existing consumer deposit accounts with only minor, technical changes.  In addition, the requirements will only apply to accounts held in "financial institutions" as defined in the Act.
98-15 10/09/98 3 & 5(11) IBA State banks may purchase Illinois real estate tax sale certificates.  Banks should have adequate policies, procedures and controls in place to protect against inherent risk and safety and soundness concerns relating to the purchase of such certificates.
99-01 03/19/99 5(14), 34(3) & 35.1 IBA State bank may own and lease personal property to a municipality.  The amount of the bank's permissible investment in the personal property subject to the lease is generally 20% of the unimpaired capital and surplus of the bank unless the lease is a general obligations of the municipality, in which case bank's investment is limited to the amount of bank's unimpaired capital and surplus or is limitless.
99-02 09/27/99 3 & 33 IBA Bank may invest seed money in a mutual fund for which it will also act as an investment subadviser.
99-03 10/06/99 3 IBA Bank may provide certain tax and accounting services that are incidental to the business of banking.  Such services include accounting, gathering books and records for preparing tax returns, offering routine tax planning and advice, and dealing with the Internal Revenue Service as an enrolled agent on behalf of a tax customer for the public.
99-04 12/15/99 1-5,13 & 2-4 CFA

Not-for-profit corporation acting as trustee of its own deferred compensation plan is not "engaging in the trust business."

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