Removing Barriers Blog

The Illinois Credit Union League Champions Sweeping Charter Update
Posted September 01,2017 by CUNA Advocacy

Recently, the Illinois Credit Union League successfully championed the enactment of an amendment to the state’s credit union act, HB 1792. The amendment includes parity provisions that would ensure state chartered credit unions remain on par with their federal counterparts. The bill improves credit union operations and services by permitting credit union members to vote electronically, adjusting the limit on loans to members, expanding the ability of credit unions to market their products and services and allowing credit unions to invest in corporate bonds and loan pools.

The electronic voting amendment is beneficial in that it would increase member participation by allowing access to a more convenient option for voting on questions and in elections of the credit union. Federal credit unions are authorized to conduct electronic voting pursuant to Article V of the Federal Credit Union Bylaws.

While the  loan limit amendment, Section 48, makes no change regarding a credit union’s loan limits, it deletes an outdated reference to loans in excess of $200.  Another amendment, Section 53, removes the reference that credit union to credit union lending limits must be recorded in the bylaws and instead authorizes the board of directors to set such limits by policy.

Further under HB 1792, credit unions may create and use descriptive and brand references to promote and market their identities, services and products to members. Credit unions electing to use branding references for marketing purposes must continue to utilize their formal name in official documentation and for legal purposes, however.

The bill also authorizes Illinois credit unions to invest in investment grade corporate bonds, provided that the credit union has established a written policy addressing investment procedures and risk management. Credit unions can also invest in pool of loans, in whole or in part, from other depository institutions and financial type institutions including mortgage banks, finance companies, insurance companies, and other loan sellers.

The bill passed by wide margins in both the Illinois House and Senate and became effective on August 25.