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Can you summarize 16 HIAR Chapter 27?
DEPARTMENT OF COMMERCE AND CONSUMER AFFAIRS > SUPERVISORY AND ENFORCEMENT ACTION RELATING TO HAWAII FINANCIAL INSTITUTIONS
Short Summary
This legal document governs supervisory and enforcement actions relating to Hawaii financial institutions. It establishes the framework and terminology for the regulation and supervision of Hawaii financial institutions and their affiliated parties. The document defines the roles of the Commissioner and the Division of Financial Institutions. It specifies the types of entities that qualify as Hawaii financial institutions and provides definitions for various terms related to these institutions. The document grants the Commissioner the authority to direct financial institutions to discontinue any violation of law or rule, unsafe or unsound practices, or conduct business in an unsafe or unsound manner. Failure to comply with the Commissioner’s order is considered a violation of law. The Commissioner may exercise supervision, control, and management over the institution, including the appointment of a receiver, if the institution fails to comply. The document defines the concept of an unsafe or unsound practice, providing examples such as failure to provide adequate supervision, failure to maintain accurate records, engaging in hazardous lending practices, and paying excessive dividends. It also defines an unsafe or unsound condition of an institution, including examples such as maintaining unduly low net interest margins, excessive overhead expenses, and excessive loan classifications. The document emphasizes the importance of proper management and adherence to sound practices to ensure the stability and integrity of Hawaii financial institutions. Additionally, the document mentions the Nondepository Rating System (NRS) and the Uniform Financial Institutions Rating System (UFIRS) as rating systems adopted by the Division. It also references relevant Hawaii Revised Statutes sections that authorize and impact the enforcement actions. The document further includes information on the memorandum of understanding, which governs informal supervisory and enforcement actions for financial institutions assigned a UFIRS or NRS composite ‘3’ rating. The memorandum seeks informal corrective administrative action from institutions of supervisory concern. It focuses on addressing specific problems and weaknesses of individual institutions. The document also covers formal supervisory and enforcement actions for financial institutions with UFIRS or NRS composite ratings of ‘4’ or ‘5’. It mentions the possibility of cease and desist orders or orders to suspend or remove institution-affiliated parties. The document highlights that compliance periods for cease and desist orders may vary based on circumstances. It also mentions the possibility of visitations and examinations to determine compliance with the orders.
Whom does it apply to?
Hawaii financial institutions, including banks, credit unions, trust companies, and more
What does it govern?
Supervisory and enforcement actions relating to Hawaii financial institutions
What are exemptions?
No exemptions are mentioned.
What are the Penalties?
No specific penalties are mentioned.
Jurisdiction
Hawaii