Powers of Trust Companies

HRS div. 2, tit. 22, ch. 412, art. 8, pt. II

in effect

HRS §412:8-200 General powers

412:8-200. General powers (a) Except as expressly prohibited or limited by this chapter, a trust company shall have the fiduciary powers specified in section 412:8-201, such powers as are granted to trustees generally by law, such other powers usual and incidental to the business of a trust company, and all rights, powers and privileges of a corporation organized under the laws of this State including but not limited to the power to: (1) Borrow money from any source within or without the State; provided that a trust company shall not pledge or encumber any client assets for the purpose of borrowing money for its own account or benefit; (2) Enter into repurchase agreements; and (3) Make investments as permitted under this article. (b) Except as otherwise expressly authorized by this chapter, a trust company shall not: (1) Issue bills of exchange or letters of credit; (2) Discount commercial paper; (3) Solicit, accept, or hold deposits; (4) Engage in a general banking, savings bank, or savings and loan association business; (5) Engage in any business for which a real estate broker's license is required, in any business for which an insurance producer license is required, or in any business of a securities broker or dealer; and (6) Make any loans or extensions of credit to any person; except, a trust company may: (A) Make loans to its affiliates not exceeding in the aggregate amount twenty per cent of the trust company's capital and surplus; (B) Make loans to its clients for the sole purpose of preventing overdrafts in the client's account or accounts or securing repayment of overdrafts in the client's account or accounts. A trust company may charge interest on such advances, subject to chapter 478. A trust company shall have a lien on the assets in the client's account or accounts for the amount of the advance or credit and interest; and (C) Pay or advance premiums due and owing by any person to an insurance company, before the payment by the person; provided that the total amount of the payments and advances at any one time for the benefit of any one person shall not exceed two per cent of the capital and surplus of the trust company, and for the benefit of all such persons shall not exceed fifteen per cent of the capital and surplus of the trust company. [L 1993, c 350, pt of §1; am L 1995, c 56, §1; am L 2003, c 212, §12]

HRS §412:8-201 Fiduciary powers

412:8-201. Fiduciary powers Every trust company shall have the power and authority to serve as a trustee, personal representative, conservator, assignee for the benefit of others, or receiver, subject to the duties imposed by the instrument or by law. As used herein, the term "instrument" means any trust agreement, declaration, or other agreement, any valid will, or any court order or decree in any probate, guardianship, conservatorship, or receivership. Pursuant thereto, a trust company is authorized and empowered to exercise powers as provided by law, including but not limited to: (1) Perform such acts as may be prudent, consistent with, and reasonably necessary to carry out the legitimate purposes of the instrument; (2) Administer, fulfill, and discharge all lawful duties imposed by the instrument or by law, for such remuneration as may be agreed upon or provided by law; (3) Acquire principal and income on behalf of the estate administered by the trust company, including without limitation real property, insurance proceeds, rents, interest, dividends, mortgages, bonds, bills, notes, and securities; (4) Buy, sell, issue, negotiate, register, transfer, or countersign certificates of stock, bonds, or other obligations of any corporation, association, or municipality; (5) Lease, purchase, hold, and convey real and personal property to the extent authorized by the instrument or by law, or consistent with the purposes thereof; and (6) Execute and issue on behalf of the estate any documents necessary to the prudent administration thereof, including without limitation any receipts, certificates, papers, and contracts which shall be signed by an appropriate trust officer designated by the trust company. [L 1993, c 350, pt of §1; am L 2004, c 161, §36; am L 2006, c 228, §41]

HRS §412:8-202 Acting as agent

412:8-202. Acting as agent (a) A trust company may act as an agent on behalf of a principal in the transaction of any business or in the management of any property, real, personal or mixed, with such powers as the trust company may exercise under sections 412:8-200, 412:8-201, and 412:8-500; provided that its duties as agent and the terms and conditions of the agency or power are set forth either specifically or generally in a written memorandum signed by the principal. (b) Every trust company undertaking or continuing to act as agent for any principal pursuant to this section shall mail or deliver to the principal or any authorized representative of the principal at stated intervals, not less frequently than once a year, and at the termination of the agency, a written statement of account setting forth: (1) All receipts and disbursements since the inception of the agency or the last previous account rendered under this paragraph, as the case may be, in such detail as will identify all properties purchased or sold during the period; (2) The credit or debit balance, as the case may be, as of the final date of the accounting period; and (3) A complete inventory of all properties, whether real, personal, or mixed, title to or custody or safekeeping of which is then held by the trust company for the account of the principal. The account shall contain such segregation of principal and income as the principal in writing specifically requires. (c) Unless previously barred by adjudication, consent or limitation, any claim against an agent for breach of fiduciary duty in connection with the agency relationship is barred as to any principal to whom the agent has mailed or delivered an annual or final accounting fully disclosing the matter in question unless a proceeding to assert the claim is commenced within two years after the annual or final accounting has been mailed or delivered to the principal. In any event and notwithstanding lack of full disclosure, an agent who has mailed or delivered an annual or final accounting to the principal and has informed the principal of the location and availability of records for the principal's examination is protected after three years from the date such accounting was mailed or delivered. (d) Every trust company shall have on hand at all times in actual money of the United States an amount equal to at least twelve per cent of all agency credit balances payable on demand and of accounts payable, plus at least five per cent of all agency credit balances payable on time; provided that such reserve may be deposited payable on demand in banks and other trust companies approved by the commissioner or may be cash in the vaults of the trust company. (e) The requirements of this section shall not apply to occasional or isolated acts performed under special instructions or at the special request of a principal who is not a general or regular client of the trust company. [L 1993, c 350, pt of §1; am L 2021, c 105, §5]

HRS §412:8-203 Use of nominees

412:8-203. Use of nominees A trust company acting in a fiduciary or agency capacity, and any fiduciary acting as a co-fiduciary with a trust company, may cause any stock, bond, or other security held in such capacity to be registered or held in the name of a nominee or nominees of the trust company or in the name of the trust company, without disclosing such fiduciary or agency capacity unless expressly otherwise provided by the instrument creating the fiduciary or agency relationship; provided, that the trust company: (1) Shall permit the nominee to have possession of or access to the stock, bond, or other security; (2) Shall clearly show on its records the name of the nominee and that the security is held by such person; and (3) Shall be responsible for any loss resulting from the act of the nominee. No liability for any loss occasioned by the acts of the trust company or its nominee or nominees, with respect to any stock, bond, or other security so registered or held, shall be imposed upon any corporation the stock, bond, or other security of which is registered in the name of the trust company or the nominee or nominees, or upon the transfer agent or registrar of the corporation. [L 1993, c 350, pt of §1]

HRS §412:8-204 Agreement between trust companies and banks

412:8-204. Agreement between trust companies and banks A trust company granted full trust powers may contract by written agreement with any bank or national banking association to carry on trust services in the bank's or national banking association's name and for its account at one or more of the banking offices of a bank or national banking association. A bank may permit by written agreement any trust company having its principal office in this State and exercising full trust powers to carry on trust services at one or more of its banking offices but in the name and for the account of the trust company. Any agreement provided for in this section, including any lease, or modification or extension thereof, shall not be effective as to any trust company until and unless it is approved in writing by the commissioner. The commissioner may approve or disapprove the agreement upon consideration of the sufficiency of the capital and surplus of the trust company and the bank, the need for trust services and other facts or circumstances which the commissioner may deem appropriate. [L 1993, c 350, pt of §1]

Source: Hawaii State Legislature (capitol.hawaii.gov), via Internet Archive capturesURL: https://www.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0412/HRS_0412-.htmFetched: 11/10/2026