BANKS-CD DISCLOSURE&PENALTIES

Illinois General Assembly - Full Text of SB2765

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SB2765 - 104th General Assembly

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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB2765

Introduced 1/13/2026, by Sen. Julie A. Morrison

SYNOPSIS AS INTRODUCED:

205 ILCS 5/48.7 new
815 ILCS 505/2MMMM new

Amends the Illinois Banking Act. Provides that a financial
institution offering a certificate of deposit shall, before account
opening, provide the consumer with a clear and conspicuous written
disclosure and a specified statement. Establishes provisions concerning
disclosure requirements for an automatically renewing certificate of
deposit; requirements for financial institutions before processing any
early withdrawal of a certificate of deposit; and enforcement provisions.
Provides that a violation of the provisions concerning mandatory
disclosures related to certificates of deposit is an unlawful practice
under the Consumer Fraud and Deceptive Business Practices Act. Amends the
Consumer Fraud and Deceptive Business Practices Act to make a
corresponding change. Effective January 1, 2027.
LRB104 16685 BAB 30089 b

A BILL FOR

SB2765
LRB104 16685 BAB 30089 b
1

AN ACT concerning regulation.

2

Be it enacted by the People of the State of Illinois,
3
represented in the General Assembly:

4

Section 5.
The Illinois Banking Act is amended by adding
5
Section 48.7 as follows:

6

(205 ILCS 5/48.7 new)
7

Sec. 48.7.
Certificates of deposit; mandatory disclosure
8
of principal-reducing penalties.

9

(a) In this Section:
10

"Certificate of deposit" or "CD" means any time-deposit
11
account with a fixed maturity date offered by a financial
12
institution.
13

"Penalty" includes any monetary charge, loss of interest,
14
adverse change in terms, or reclamation of bonuses imposed for
15
early withdrawal of funds from a time account, consistent with
16
federal regulations. "Penalty" also includes:

17

(1) Monetary penalties, such as a flat fee or a
18

specified number of days' interest.
19

(2) Adverse changes to account terms, including
20

reductions in the interest rate, annual percentage yield,
21

or compounding frequency.
22

(3) Reclamation of bonuses offered at account opening.

23

(b) A financial institution offering a certificate of

SB2765
- 2 -
LRB104 16685 BAB 30089 b
1
deposit shall, before opening an account, provide the consumer
2
with a clear and conspicuous written disclosure stating:

3

"Early withdrawal penalties may exceed the amount of
4
interest earned and may reduce the principal amount you
5
originally deposited."

6

(c) The written disclosure provided to the consumer shall:

7

(1) be included on the CD agreement or signature card;
8

(2) be printed in at least 12-point bold type; and
9

(3) appear immediately adjacent to any description of
10

early withdrawal penalties.

11

(d) For any certificate of deposit that renews
12
automatically, the financial institution shall include the
13
disclosure required under subsection (b) in the renewal notice
14
sent prior to the start of the grace period.
15

(e) Before processing any early withdrawal of a
16
certificate of deposit, the financial institution shall
17
provide the consumer with a written statement of:

18

(1) the total early withdrawal penalty;
19

(2) any applicable fees; and
20

(3) the net amount the consumer will receive if the
21

withdrawal is completed.

22

The consumer shall affirmatively acknowledge receipt of
23
this statement, electronically or in writing, prior to
24
finalizing the withdrawal.

25

(f) A violation of this Section constitutes an unlawful
26
practice under the Consumer Fraud and Deceptive Business

SB2765
- 3 -
LRB104 16685 BAB 30089 b
1
Practices Act.
2

(g) The Department may adopt rules necessary to administer
3
and enforce this Section.

4

Section 10.
The Consumer Fraud and Deceptive Business
5
Practices Act is amended by adding Section 2MMMM as follows:

6

(815 ILCS 505/2MMMM new)
7

Sec. 2MMMM.
Violations of the Illinois Banking Act.
Any
8
person who violates Section 48.7 of the Illinois Banking Act
9
commits an unlawful practice within the meaning of this Act.

10

Section 99.
Effective date.
This Act takes effect January
11
1, 2027.

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