Client Alert: Governor Rauner Signs Quasi-Reorganization Legislation
New Illinois law helps facilitate dividend payments for otherwise healthy state-chartered banks with negative retained earnings. Contact us to determine your institution's eligibility and to navigate the process.
On August 13, 2015, Governor Bruce Rauner signed into law the quasi-reorganization legislation (SB1861) that was initiated by the Illinois Bankers Association at our Firm's request in response to the peculiar capital situation faced by some of our clients. The legislation is described in more detail in the recent Client Alert: New Law Helps Recovering Banks Pay Dividends (June 9, 2015).
The legislation makes it easier for an eligible Illinois state-chartered bank to transfer funds from its capital and surplus accounts into its undivided profits account to remove any existing deficit.
We continue to discuss with the Illinois DFPR, as well as the federal banking agencies, how they intend to allow banks to effectuate quasi-reorganizations, including eligibility requirements and details about the application process.
We Can Help
Please call us if you are interested in exploring a quasi-reorganization for your institution.