CHAPTER 412

[CODE OF FINANCIAL INSTITUTIONS]

 

ARTICLE 1.  GENERAL PROVISIONS

 

Section

   412:1-100 Short title

   412:1-101 Purpose

   412:1-102 Scope and application of chapter

   412:1-103 Application to existing financial institutions

   412:1-104 Names

   412:1-105 Deposits

   412:1-106 Headings; references

   412:1-107 Particular provisions prevail

   412:1-108 Jurisdiction conferred upon circuit court

   412:1-109 Definitions

 

ARTICLE 2.  DIVISION OF FINANCIAL INSTITUTIONS

 

         Part I.  Administration

   412:2-100 Commissioner of financial institutions; division

             of financial institutions

 412:2-100.5 Powers of the commissioner

   412:2-101 Deputy commissioner, acting commissioner

   412:2-102 Examiners and other personnel

   412:2-103 Disqualifications

   412:2-104 Confidentiality of information possessed by

             commissioner

   412:2-105 Fees

 412:2-105.1 Repealed

 412:2-105.2 Hawaii financial institutions; assessments;

             fees; penalty

   412:2-106 Public or private hearings

   412:2-107 Rules

   412:2-108 Alternative mortgage loans rules

   412:2-109 Compliance resolution fund; financial institution

             examiners

   412:2-110 Emergency applications

   412:2-111 Commissioner's power to subpoena

 

         Part II.  Examinations

   412:2-200 Examinations

   412:2-201 Use of federal examinations

 

         Part III.  Enforcement Actions

   412:2-300 Enforcement actions

   412:2-301 Joint enforcement with federal regulatory agency

   412:2-302 Cease and desist orders; grounds for issuance

   412:2-303 Permanent cease and desist orders; procedure;

             hearing; enforcement

   412:2-304 Temporary cease and desist orders; effective date;

             hearing; enforcement

   412:2-305 Consent cease and desist orders

   412:2-306 Removal or prohibition of institution-affiliated

             party; grounds

   412:2-307 Removal or prohibition of institution-affiliated

             party; procedure; hearing; enforcement

   412:2-308 Order of immediate suspension; procedure;

             effective date; hearing; enforcement

   412:2-309 Consent order of removal or prohibition

   412:2-310 Removal, prohibition, or suspension; effect of

             order

   412:2-311 Suspension or revocation of charter or license

   412:2-312 Suspension or revocation; procedure; hearing;

             enforcement

   412:2-313 Consent suspension and revocation order

   412:2-314 Action to correct capital and surplus impairment

   412:2-315 National or state emergencies

 

         Part IV.  Conservators and Receivers

   412:2-400 Grounds for appointment of conservator or receiver

   412:2-401 Appointment of conservator or receiver; judicial

             review

   412:2-402 Additional grounds for appointment

   412:2-403 Who may serve as conservator or receiver

   412:2-404 Federal insurer as conservator or receiver;

             subrogation

   412:2-405 Removal or replacement of conservator or receiver

   412:2-406 Compensation and expenses of conservator or

             receiver

   412:2-407 Stay of judicial proceedings

   412:2-408 Duties and powers of conservator

   412:2-409 Conservator's segregation of deposits

   412:2-410 Supervised reorganization

   412:2-411 Termination of conservatorship

   412:2-412 Duties and powers of receiver

   412:2-413 No interest on deposits of an institution in

             receivership

   412:2-414 Optional court supervision

   412:2-415 Notice of receivership; filing of claims

   412:2-416 Liquidation by receiver; priority of claims

   412:2-417 Final accounting and discharge

   412:2-418 Transfer of assets in contemplation of

             insolvency void

   412:2-419 Treatment of lessors

   412:2-420 Claims for wrongful termination of employment

   412:2-421 Bailments and safe deposit boxes in receivership

 

         Part V.  Supervised Acquisition of Financial

                  Institutions

   412:2-500 Definitions

   412:2-501 Commissioner's determination of failing

             institution

   412:2-502 Solicitation of purchasers

   412:2-503 Applications to purchase

   412:2-504 Granting of application; criteria for approval

   412:2-505 Waiver of statewide concentration limits under

             the Bank Holding Company Act of 1956, as amended

   412:2-506 Charter or license

   412:2-507 Expedited approvals

   412:2-508 Provisional approval to organize

   412:2-509 Effect of merger or acquisition on prior business,

             title and obligations

   412:2-510 Commissioner's powers

   412:2-511 Modification of time periods

   412:2-512 Repealed

 

         Part VI.  Penalties, Administrative Fines and

                   Prohibited Acts

   412:2-600 Applicability of part

   412:2-601 Violation of chapter

   412:2-602 Copying records of Hawaii financial institutions

   412:2-603 Disclosures of records of Hawaii financial

             institutions

   412:2-604 Concealment

   412:2-605 Repealed

   412:2-606 Witness; failure to testify or produce records

 412:2-606.5 Financial institution name fraud

   412:2-607 Deception; false statements

   412:2-608 Misapplication of funds

   412:2-609 Imposition of administrative fines; assessment

 412:2-609.5 Imposition of administrative fines on persons who

             are not Hawaii financial institutions; assessment

   412:2-610 Compromise or modification of administrative

             fines;

             determining amount of fine; hearing

   412:2-611 Action to recover administrative fines; deposit to

             compliance resolution fund

 

ARTICLE 3.  ORGANIZATION AND MANAGEMENT OF FINANCIAL

INSTITUTIONS

 

         Part I.  General Provisions

   412:3-100 Applicability of this part

   412:3-101 Name of financial institution

   412:3-102 Change of name

   412:3-103 Repealed

   412:3-104 Qualifications of directors

   412:3-105 Election and appointment of executive officers

   412:3-106 Residency of chief executive officer

   412:3-107 Meetings of the board

   412:3-108 Generally accepted accounting principles

   412:3-109 Charging down assets

   412:3-110 Holding of assets

   412:3-111 Maintenance of books and records

 412:3-111.5 Request for information by the commissioner

   412:3-112 Submissions to commissioner

   412:3-113 Repealed

   412:3-114 Duty to report illegal acts

 412:3-114.5 Mandatory reporting of suspected financial abuse

             of an elder

   412:3-115 Repealed

 

         Part II.  Organization of Banks, Savings Banks,

                   Savings and Loan Associations, Trust

                   Companies and Depository Financial

                   Services Loan Companies

   412:3-200 Applicability of part

   412:3-201 Application for preliminary approval to organize

             a financial institution

   412:3-202 Additional requirements for holding company

   412:3-203 Deferral of application requirements

   412:3-204 Publication of notice

   412:3-205 Informational and comment proceeding on

             application

   412:3-206 Grant of preliminary approval to organize a

             financial institution

   412:3-207 Denial of preliminary approval to organize

   412:3-208 Repealed

   412:3-209 Paid-in capital and surplus

   412:3-210 Repealed

   412:3-211 Time limit to complete organization

   412:3-212 Final application for charter or license

   412:3-213 Denial of charter or license

 

         Part III.  Organization of Nondepository

                    Financial Services Loan Companies

   412:3-300 Applicability of part

   412:3-301 Application for license

   412:3-302 Publication of notice

   412:3-303 Informational and comment proceeding

   412:3-304 Grant of approval

   412:3-305 Denial of license

   412:3-306 Paid-in capital and surplus

 

         Part IV.  Management of Stock Financial Institutions

   412:3-400 Applicability of part

   412:3-401 Applicability of Hawaii Business Corporation Act

   412:3-402 Capital stock

   412:3-403 Dividends and other capital distributions

 

         Part V.  Places of Business

   412:3-500 Prohibition of business at unauthorized locations

   412:3-501 Authorized places of business

   412:3-502 Foreign financial institution

   412:3-503 Opening or relocating principal office, branch,

             or agency

   412:3-504 Notice and deadline for opening or relocating

             principal office, branch, or agency

   412:3-505 Opening or relocating out-of-state branch or

             agency

   412:3-506 Opening or relocating a support facility

   412:3-507 Closing branch or agency; temporary closures

             and relocations

   412:3-508 Closing a support facility

   412:3-509 Out-of-state branch or agency

 

         Part VI.  Conversions, Mergers, Consolidations,

                   Acquisitions, Assumptions, and Voluntary

                   Dissolutions

   412:3-600 Applicability of this part

   412:3-601 No conversions, mergers, consolidations,

             acquisitions, assumptions, voluntary cessations of

             business, or voluntary dissolutions except

             pursuant to this part

   412:3-602 Definitions

   412:3-603 Procedure for applications pursuant to this part

   412:3-604 Shareholder or member vote

   412:3-605 Notice to credit union member

   412:3-606 Conversion from State to comparable federal

             financial institution

   412:3-607 Conversion from federal to comparable Hawaii

             financial institution

   412:3-608 Conversion to another type of financial

             institution

   412:3-609 Merger or consolidation of Hawaii financial

             institutions

   412:3-610 Effect of conversion, merger, or consolidation

   412:3-611 Merger or consolidation of financial institution

             holding companies

   412:3-612 Acquisition of control of financial institution

             or financial institution holding company

   412:3-613 Sale or acquisition of assets and transfer or

             assumption of liabilities

   412:3-614 Sale or transfer of charter or license prohibited

   412:3-615 Nonconforming assets or business

   412:3-616 Authority for expedited conversion, merger,

             consolidation, acquisition, or assumption

   412:3-617 Voluntary cessation of business; dissolution

   412:3-618 Injunctions

 

ARTICLE 4.  DEPOSITS IN FINANCIAL INSTITUTIONS GENERALLY

 

   412:4-100 Law applicable

   412:4-101 Forms of deposit

   412:4-102 Deposit account statements

   412:4-103 Statements presumed correct after one year;

             statute of limitations

   412:4-104 Federal deposit insurance required

   412:4-105 Accounts held in more than one name

   412:4-106 Fiduciary accounts

   412:4-107 Accounts of minors

   412:4-108 No notice of incapacity

   412:4-109 Checks drawn or transfers or withdrawals made by

             authorized persons

   412:4-110 Checks drawn or transfers or withdrawals made by

             intoxicated persons

   412:4-111 Accounts of deceased nonresidents

   412:4-112 Pledging of assets

 

ARTICLE 5.  BANKS

 

         Part I.  General Provisions

   412:5-100 Definition

   412:5-101 Necessity for bank charter

 

         Part II.  Powers of Banks

   412:5-200 General powers

   412:5-201 Powers granted under federal law

   412:5-202 Membership in federal banks

   412:5-203 Operating subsidiaries

   412:5-204 Acceptances of drafts and bills of exchange

   412:5-205 Authority to engage in trust business

 412:5-205.5 Insurance and annuities powers

 412:5-205.6 Requirements of banks engaging in insurance

             activities

 412:5-205.7 Securities powers

   412:5-206 International banking facilities

 

         Part III.  Loans and Investments

   412:5-300 Applicability of part

   412:5-301 General requirements for loans

   412:5-302 Limitations on loans and extensions of credit to

             one borrower

   412:5-303 Loans to executive officers, directors, principal

             shareholders and affiliates

   412:5-304 General requirement for investments

   412:5-305 Permitted investments

   412:5-306 Deposits made by banks

 

         Part IV.  Intra-Pacific Banks

   412:5-400 Definitions

   412:5-401 Required approval

   412:5-402 Procedure to obtain approval

   412:5-403 Examination and regulation

   412:5-404 Termination of authority of intra-Pacific bank

   412:5-405 Termination of authority of intra-Pacific bank

             holding company

   412:5-406 Paid-in capital and surplus

   412:5-407 Same powers and duties as banks

 

ARTICLE 5A.  INTERNATIONAL BANKING CORPORATIONS

 

         Part I.  General Provision

  412:5A-100 Applicability of other provisions of this chapter

 

         Part II.  Application Procedures and Powers

  412:5A-200 Scope and definitions

  412:5A-201 Application; fee; approval

  412:5A-202 Majority ownership by bank

  412:5A-203 Paid-in capital and surplus

  412:5A-204 Prohibition of business in United States

  412:5A-205 Powers and duties

  412:5A-206 Acceptance of deposits and reserves

  412:5A-207 Deposit of corporate funds

  412:5A-208 Limitation on investments

  412:5A-209 Acquisition of stock in competing corporation

  412:5A-210 Acquisition of stock to save a loss

  412:5A-211 Prohibited corporate activities

  412:5A-212 Improper discounting of loans

  412:5A-213 Improper fixing of commodity prices

  412:5A-214 Misrepresentation of state liability for bonds

 

         Part III.  Foreign Bank Offices and Agencies--Repealed

  412:5A-300 to 316 Repealed

 

ARTICLE 6.  SAVINGS BANKS

 

         Part I.  General Provisions

   412:6-100 Definition

   412:6-101 Necessity for savings bank charter

 

         Part II.  Powers of Savings Banks

   412:6-200 General powers

   412:6-201 Powers granted under federal law

   412:6-202 Membership in federal home loan bank

   412:6-203 Service corporations

   412:6-204 Operating subsidiaries

 

         Part III.  Loans and Investments

   412:6-300 Applicability of part

   412:6-301 General requirements for loans

   412:6-302 Requirements and limits for certain loans

   412:6-303 Limitations on loans and extensions of credit to one

             borrower

   412:6-304 Loans and extensions of credit to executive

             officers, directors, principal shareholders and

             affiliates

   412:6-305 General requirement for investments

   412:6-306 Permitted investments

   412:6-307 Deposits made by savings banks

 

ARTICLE 7.  SAVINGS AND LOAN ASSOCIATIONS

 

         Part I.  General Provisions

   412:7-100 Definition

   412:7-101 Necessity for savings and loan association charter

 

         Part II.  Powers of Savings and Loan Associations

   412:7-200 General powers

   412:7-201 Powers granted under federal law

   412:7-202 Membership in federal home loan bank

   412:7-203 Service corporations

   412:7-204 Operating subsidiaries

 

         Part III.  Loans and Investments

   412:7-300 Applicability of part

   412:7-301 General requirements for loans

   412:7-302 Requirements and limits for certain loans

   412:7-303 Limitations on loans and extensions of credit to one

             borrower

   412:7-304 Loans and extensions of credit to executive

             officers, directors, principal shareholders and

             affiliates

   412:7-305 General requirement for investments

   412:7-306 Permitted investments

   412:7-307 Deposits made by savings and loan associations

 

         Part IV.  Management of Mutual Savings and Loan

                   Associations--Repealed

   412:7-400 to 408 Repealed

 

ARTICLE 8.  TRUST COMPANIES

 

         Part I.  General Provisions

   412:8-100 Applicability of article

   412:8-101 Definitions

   412:8-102 Necessity for trust company charter

   412:8-103 Authority to serve as trustee

 

         Part II.  Powers of Trust Companies

   412:8-200 General powers

   412:8-201 Fiduciary powers

   412:8-202 Acting as agent

   412:8-203 Use of nominees

   412:8-204 Agreement between trust companies and banks

 

         Part III.  Investment of Trust Company Assets

   412:8-300 Applicability of part

   412:8-301 Permitted investments of capital and surplus

   412:8-302 Deposits made by trust companies

 

         Part IV.  Investment of Fiduciary Assets

   412:8-400 General requirements

   412:8-401 Trust funds awaiting investment

   412:8-402 Common trust fund investments

   412:8-403 Disclosure of fees

 

ARTICLE 9.  FINANCIAL SERVICES LOAN COMPANIES

 

         Part I.  General Provisions

   412:9-100 Definitions

   412:9-101 Necessity for financial services loan company

             license

   412:9-102 Repealed

   412:9-103 Display of license

 

         Part II.  Powers of Financial Services Loan Companies

   412:9-200 General powers

   412:9-201 Powers that require regulatory approval

   412:9-202 Prohibitions

 

         Part III.  Loans and Extensions of Credit

   412:9-300 General requirements for loans and extensions

             of credit

   412:9-301 Interest computation methods

   412:9-302 Interest rates

   412:9-303 Effect of excessive interest

   412:9-304 Consumer loan charges

   412:9-305 Open-end consumer loans

   412:9-306 Refunds on prepayment of a precomputed loan

   412:9-307 Fraction of a month

   412:9-308 Repayment terms

   412:9-309 Assignments, sale or pledge of loans

 

         Part IV.  Depository Financial Services Loan Companies

   412:9-400 Special powers of a depository financial services

             loan company

   412:9-401 Required reserve for a depository financial services

             loan company

   412:9-402 Membership in federal home loan bank

   412:9-403 Service corporations

   412:9-404 Limitations on loans and extensions of credit to one

             borrower

   412:9-405 Loans and extensions of credit fully secured by

             real property

   412:9-406 Repealed

   412:9-407 Limits on transactions with affiliates, executive

             officers, directors or principal shareholders

   412:9-408 General requirement for investments

   412:9-409 Permitted investments

   412:9-410 Deposits made by depository financial services loan

             companies

 

         Part V.  Nondepository Financial Services Loan

                  Companies

   412:9-500 Prohibitions

   412:9‑501 Registration of nondepository financial services

             loan companies with NMLS

 

ARTICLE 10.  CREDIT UNIONS

 

         Part I.  General Provisions

  412:10-100 Definitions

  412:10-101 Necessity for credit union charter

  412:10-102 Capital stock or surplus

  412:10-103 Application for charter

  412:10-104 Articles and bylaws

  412:10-105 Disclosure of information

  412:10-106 Deposit and share insurance

  412:10-107 Grant of approval

  412:10-108 Denial of charter

  412:10-109 Membership

  412:10-110 Membership meetings

  412:10-111 Voting

  412:10-112 Board of directors

   412:10-113 No compensation of directors or committee members

  412:10-114 Credit committee

  412:10-115 Credit manager

  412:10-116 Loan officers

  412:10-117 Supervisory committee

  412:10-118 Record of officials

  412:10-119 Conflicts of interest

  412:10-120 Suspension or removal of officials

  412:10-121 Central credit unions

  412:10-122 Taxation

  412:10-123 Fiscal year

  412:10-124 Conducting business outside this State

  412:10-125 Repealed

 

         Part II.  Powers of Credit Unions

  412:10-200 General powers

  412:10-201 Powers granted under federal law

  412:10-202 Credit union service organizations

  412:10-203 Sale or purchase of obligations or notes

  412:10-204 Sale or purchase of assets

 

         Part III.  Accounts

  412:10-300 Applicability of other provisions of this chapter

  412:10-301 Share accounts and membership shares

  412:10-302 Dividends

  412:10-303 Deposit accounts

  412:10-304 Withdrawals

  412:10-305 Minor accounts

  412:10-306 Joint accounts

  412:10-307 Trust accounts

  412:10-308 Payable-on-death accounts

  412:10-309 Liens

  412:10-310 Dormant accounts

 

         Part IV.  Loans

  412:10-400 Applicability of part

  412:10-401 General requirements for loans

  412:10-402 Loans to members

  412:10-403 Interest rates

  412:10-404 Other charges

  412:10-405 Applications

  412:10-406 Prepayment of loan

  412:10-407 Limitations on obligations of one borrower

  412:10-408 Loans to officials

  412:10-409 Real estate mortgage loans

  412:10-410 Lines of credit

  412:10-411 Loans to other credit unions

  412:10-412 Participation loans

  412:10-413 Other loan programs

 

         Part V.  Investments

  412:10-500 Applicability of part

  412:10-501 General requirement for investments

  412:10-502 Permitted investments

  412:10-503 Deposits made by credit unions

 

         Part VI.  Reserve Allocations

  412:10-600 Regular reserve

  412:10-601 Special reserves

  412:10-602 Risk assets

 

         Part VII.  Other Member Services

  412:10-700 Insurance for members

  412:10-701 Liability insurance for officers

  412:10-702 Group purchasing

  412:10-703 Money-type instruments

  412:10-704 Retirement accounts

 

         Part VIII.  Corporate Credit Union

  412:10-800 Application of part

  412:10-801 Purposes

  412:10-802 Membership

  412:10-803 Organization

  412:10-804 Management and operation of corporate credit union

  412:10-805 Powers

  412:10-806 Participation in central system

  412:10-807 Collection on loans to members

  412:10-808 Meetings

 

ARTICLE 11.  FINANCIAL INSTITUTION HOLDING COMPANIES

 

  412:11-100 Applicability of article

  412:11-101 Registration and reporting of financial

             institution

             holding companies

  412:11-102 Examination of financial institution holding

             company

  412:11-103 Use of state or federal examinations

  412:11-104 Service of process

  412:11-105 Sanctions for failure to register or submit

             reports

  412:11-106 Injunctions

 

ARTICLE 12.  INTERSTATE BRANCHING AND BANK MERGERS

 

  412:12-100 Purpose

  412:12-101 Definitions

  412:12-102 Authority of Hawaii state banks to establish

             interstate branches by merger

  412:12-103 Authority of Hawaii state banks to establish a de

             novo interstate branch or acquire an interstate

             branch

  412:12-104 Authority of out-of-state banks to establish

             interstate branches in Hawaii by merger

  412:12-105 Authority of out-of-state banks to establish a de

             novo interstate branch or acquire an interstate

             branch

  412:12-106 No concentration limit under Hawaii state law;

             waiver of federal concentration limits

  412:12-107 Powers; additional branches

  412:12-108 Examinations; periodic reports; cooperative

             agreements; assessment of fees

  412:12-109 Enforcement

  412:12-110 Notice of subsequent merger, etc.

 

ARTICLE 13.  THE HAWAII INTERNATIONAL BANKING ACT

 

         Part I.  General

  412:13-100 Title and purpose

  412:13-101 Application to existing foreign banks

  412:13-102 Definitions

 

         Part II.  Direct Branch, Agency, and Representative

                   Offices of Foreign Banks

  412:13-200 Purpose

  412:13-201 Branches and agencies of foreign banks; necessity

             of licensure

  412:13-202 Application to establish and maintain a branch or

             agency; contents

  412:13-203 Application to establish and maintain a branch or

             agency; manner of filing and determination

  412:13-204 Denial of license

  412:13-205 Amended license to establish and maintain a branch

             or agency

  412:13-206 Application fees

  412:13-207 No concurrent maintenance of federal branches or

             agencies

  412:13-208 Powers of branch and agency

  412:13-209 Filing of amendments to articles of incorporation

  412:13-210 Separate assets

  412:13-211 Disclosure of lack of deposit insurance

  412:13-212 Limitations on payment of interest on deposits

  412:13-213 Pledge of assets

  412:13-214 Asset maintenance

  412:13-215 Representative office of foreign banks; necessity

             of licensure

  412:13-216 Representative office; application

  412:13-217 Representative office; factors for approval of

             application

  412:13-218 Representative office; permissible activities

  412:13-219 Posting of license

  412:13-220 Licenses not transferable

  412:13-221 Change of control of foreign bank

  412:13-222 Relocation of office; written application

             necessary

  412:13-223 Examination; payment of fees

  412:13-224 Supervision and enforcement

  412:13-225 Reports

  412:13-226 Books, accounts, and records

  412:13-227 Voluntary closure of branch, agency, or

             representative office; application

  412:13-228 Suspension or revocation of license; grounds;

             procedures

  412:13-229 Immediate suspension or revocation

  412:13-230 Seizure of foreign bank's property and business;

             liquidation

 

         Part III.  Hawaii Branches of Out-of-State Foreign

                    Banks

  412:13-300 Purposes

  412:13-301 Establishment of interstate branches in this State

             by out-of-state foreign banks

 

ARTICLE 14.  MISCELLANEOUS PROVISIONS

 

  412:14-100 Automated teller machine fees

 

Revision Note

 

  Chapter heading added by revisor.

 

Cross References

 

  Money transmitters act, see chapter 489D.

  Secure and fair enforcement for mortgage licensing act, see chapter 454F.

 

Rules of Court

 

  Applicability of Hawaii Rules of Civil Procedure, see HRCP rule 81(b)(12).

 

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