Presentation to Hawaii Estate Planning Council Education of Corporate Trustees April 28, 2016 Facilitators Courtney Kajikawa Manager of FHB Diane Chong Manager of CPB Bonnie Fong Manager of BOH Todd Hoch Manager of FFB Bonnie Introduction 1 min Set stage all 4 trust companies, speakers will touch on various topics (5-10 min) as it relates to a Corporate Trustee for total of 30-35 min save questions for the end and feel free to pose the questions to anyone of us.

Outline What Defines a Corporate Trustee Todd Account Acceptance Process Courtney Problematic Language Bonnie Risk Mitigation Diane Compensation of Corporate Trustee Todd Perceived Downside of Corporate Trustee Bonnie Bonnie walk thru how the presentation will run and who will speak on each topic leaving questions to the end.

What Defines a Corporate Trustee Corporate Charter What is it? How is it obtained? Why is it important? Benefits of a charter Regulatory Oversight Various governing agencies Federal, State, Internal audit Role that they serve Benefits and Drawbacks Todd Hoch 3 – 5 min

Account Acceptance Process Minimum account values Account acceptance process Document review Asset review Red Flags Declinations Courtney 10 min Reg flags to include trustee requesting to resign (especially if its another bank), litigation, Document Review: fee language, clear dispositive provisions, resignation or removal language, ability to administer

Problematic Language One pot versus separate pot trusts Discretion under ascertainable standards Interpreting intent of settlor Dealing with blended families Handling closely held business Entities holding real estate assets Increase in estate tax exemption impact on old documents- funding of family/marital trusts Restrictive or outdated fee language Bonnie 10 min

Risk Mitigation Periodic document and account review Understanding settlers intent Start relationship prior to death Clear on preferred beneficiary Delegate responsibilities Leverage courts for clarification of language and approval of accountings Jamie 5 min

Compensation of Corporate Trustee Bundled Fees Administrative services & Investment management Percentage X assets managed on a declining scale Asset management Liquid assets – mutual funds, stocks, bonds, cash Internal and 3rd party investment managers expenses Closely held business interest Real Estate Primary residence - title holding Income property – property management, % of income Other Fees Inception, disbursement, termination and minimum Co-trustee fee, special services, tax services Todd 5 min

Perceived Downside of Corporate Trustees Strict interpretation of the document Disclosure to both income and defined remainder beneficiaries Committee oversight Bonnie 5 min

Questions? Courtney Kajikawa Manager of FHB Diane Chong Manager of CPB Bonnie Fong Manager of BOH Todd Hoch Manager of FFB Bonnie to open up for questions to any of the speakers 10 min