Ka Wai Ola - Office of Hawaiian Affairs, Volume 13, Number 10, 1 ʻOkakopa 1996 — The creation of an OHA bank [ARTICLE+ILLUSTRATION]

The creation of an OHA bank

Rev. Moses K. Keale, Sr. Trustee, Kaua'i and Ni'ihau

At the Board of Trostees' community meetings recently held on the islands of I Hawai'i and Kaua'i our people cried out I for an OHA bank. The $20M we set up with First l Hawaiian Bank ($10M for home repairs ! and $10M for downpayments) is a failure as our HHL homesteaders cannot qualify , for the loans. Almost $20M still sits in I our portfolio. In 1990. I suggested that we look into I the creation of a bank in whieh we could I

deposit our assets and promote the growth and appropriate use of those assets whieh would reflect the needs, goals and purposes defined by our people. I pointed out that nations are dependent on their banking system for eeonomie growth and that Hawai'i's history has shown that eaeh immigrant labor group entering Hawai'i eventually established a bank whieh reflected their cultural identity. In 1993, I addressed the question of whether OHA should be directly involved in the establishment of a Hawaiian financial institution and thus become direct players in Hawai'i's business and eeonomie future. It has been clear from the very beginning that OHA's destiny would lead it to become a major player in the shaping of the future of Hawai'i. As we proceed in our work, eaeh step must be carefully planned with one thought in mind — the protection and advancement of the Hawaiian people. It has been clear that our job, as trustees of the Hawaiian people's assets, is to protect and increase these assets for future generations. An institution of our own would address this. OHA commissioned a reputable international managcmcnt consultant firm, Grant Thornton, to investigate the feasibility of establishing a Hawaiian financial services loan company (FSLC). They said "A Hnaneial institution to address the unmet needs of the native Hawaiian community is a critical part of the movement toward sovereignty and eeonomie self-reliance." The two-vo!ume report provided a comprehensive strategic business plan for identifying the financial needs of the Hawaiian people and a method to satisfy them. The FSLC would initially provide quality loans to ' H MlllllllllWMMi 1 Wm 9 ** WĒĒMĒM

selccted customers emphasizing the following types of loans: residential real estatc, land purchases, construc-

tion, bridge capital, improvement fee purchases, student loans, FHA loans, Hawaiian homestead loans, Veterans Administration and Hula Mae. Most importantly, this would be a Hawaiian institution, dedicated to Hawaiian needs. An FSLC could.adopt rules and regulations whieh would providc for a differcnt set of qualifications to issue loans to people who would not otherwise qualify under normal conditions, and who may also have the opportunity to own or improve their own homes.

If we had acted with true visionary insight, as we did nine years ago when we established the Native Hawaiian Revolving Loan Fund program, we would have had an FSLC in piaee and operating when we received the miliions of dollars in past-due ceded lands revenues from the state. Instead OHA has almost $20M sitting in our portfolio for Hawaiian Homes homesteaders who cannot qualify by FHB standards. In October 1993, the Planning, Eeonomie Development & Housing Committee (PED&H) unanimously voted to authorizc and appropriate $20M in Trust Funds for the establishment of an FSLC. I was chairman of the Committee at the time. When the eonveying documents were prepared for the Budget & Finance Committee for the next level of approval, three members of the PED&H Committee signed "I do not concur." Our*staff attorney ruled ..."to change their votes by motions to reconsider or rescind or to amend something previously adopted (Robert's Rules) is ineffective and inappropriate." To this day the FSLC matter still sits in thc files of Chairman Abraham Aiona of thc B&F Committcc. This OHA financial institution would help all Hawaiians regardless of blood quantum. So, for those of you who asked at our community meetings about an OHA BANK, be assured lhere has been discussions of it, but there has not been sufficient votes to pass it out. This OHA financial institution would have helped all Hawaiians regardless of blood quantum. I share this so that you all will understand why OHA does not have a BANK!