We are not aware of any federal or Illinois notice requirements when exercising a right of setoff, but we recommend reviewing your account agreements for any contractual notice requirements. However, if your account agreements are silent as to whether notice is required when exercising your right of setoff, your bank still may wish to consider providing some form of notice to the borrower to ensure they are aware of the default prior to receiving their next deposit account statement to avoid any confusion as to why their deposit account balance has decreased.