Illinois Rep. Avelar’s banking regulation update bill passes House and Senate

Passed bill authored by State Rep. Dagmara Avelar aims to update Illinois banking statutes, clarify corporate powers, and establish governance and reporting standards for banking institutions, according to the Illinois General Assembly.

In the House, 75 Democrats and 38 Republicans voted in favor of the bill.

Meanwhile, in the Senate, 39 Democrats and 19 Republicans voted in favor of the bill.

Avelar introduced the bill in the Illinois House on Feb. 7, 2025 during the 104th session.

The legislation, known as HB3467, was passed on May 22, 2025 during the general assembly session 104.

According to the Illinois General Assembly site, the legislature summarized the bill’s official text as follows: “Amends the Illinois Banking Act. Makes changes to the membership of the State Banking Board of Illinois. Provides that a bank may borrow or incur an obligation and pledge assets to secure deposits. Provides that a bank may provide data processing services to a person for profit. Provides that a bank may invest in financial futures or options transactions. Provides that the board of directors of a bank may provide by resolution that stockholders may attend, participate in, act in, and vote at any annual meeting or special meeting through the use of a conference telephone or interactive technology if specified conditions are satisfied. Provides that a person who makes, or causes to be made, a false statement or false entry with intent to deceive any person or persons authorized to examine into the affairs of the bank or the subsidiary or holding company of that bank, the branch of an out-of-state bank with intent to deceive the Commissioner of Banks and Real Estate or his administrative officers in the performance of their duties under the Act shall be subject to civil penalties imposed by the Commissioner (rather than be guilty of a Class 3 felony). Provides that the Board may authorize the transfer of funds from the Bank and Trust Company Fund. Amends the Savings Bank Act. Provides that the board of directors of a savings bank may provide by resolution that members or stockholders may attend, participate in, act in, and vote at any annual meeting or special meeting through the use of a conference telephone or interactive technology if specified conditions are satisfied. Provides that a savings bank may loan funds through the purchase of fixed rate annuity contracts. Provides that a savings bank may accept deposits made by a minor and may open an account in the name of the minor, and the rules and regulations of the savings bank with respect to each deposit and account shall be as binding upon the minor as if the minor were of full age and legal capacity. Makes changes to various provisions concerning notice to allow for electronic notice. Makes other changes. Amends the Illinois Credit Union Act. Does not prohibit the furnishing of financial records of a deceased member to a public administrator of any county or other governmental jurisdiction for the purpose of facilitating burial of the customer. Makes other changes. Effective immediately.”

The following is our breakdown, based on the actual bill text, and may include interpretation to clarify its provisions.

In essence, the bill amends the Illinois Banking Act and related statutes to update the definitions of banking terms, outline general corporate powers, and establish procedures for charter issuance and changes in banking institutions. It addresses requirements for stock, stockholder meetings, and board of director governance, including virtual meeting protocols. It prohibits employment of individuals with felony convictions related to dishonesty or breach of trust without the Commissioner’s consent and defines the nature of authorized loans and investments. Additionally, the bill mandates reporting and examination procedures, revises customer financial record confidentiality, and stipulates conditions under which certain banking practices are prohibited. It specifies how financial records should be handled when responding to legal requests and allows collaboration with agencies regarding suspected elder financial exploitation. The bill also repeals specific sections of the Savings Bank Act deemed obsolete. The effective date is upon becoming law.

The bill was sponsored by Sen. Jason Plummer (Republican-55th District) and Sen. Robert F. Martwick (Democrat-10th District).

Bills in Illinois follow a multi-step legislative process, beginning with introduction in either the House or Senate, followed by committee review, floor debates, and votes in both chambers before reaching the governor for approval or veto. The General Assembly operates on a biennial schedule, and while typically thousands of bills are introduced each session, only a fraction successfully pass through the process to become law.

You can read more about bills and other measures here.

Avelar graduated from Northeastern Illinois University in 2010 with a BS.

Avelar, a Democrat, was elected to the Illinois State House in 2021 to represent the state’s 85th House District, replacing previous state representative John Connor.

Lawmakers listed as “Not Voting” were present for the vote but did not cast a vote. Those marked as having an “Excused Absence” were not present and formally provided a reason for their absence, which was accepted.