auditor may, in relation to such books and accounts, examine the directors or any other officer of the corporation.

The auditor or auditors shall make a report to the stockholders on the accounts examined by him or them, and on every balance sheet laid before the corporation in general meeting during his or their tenure of office; and in every such report shall state whether in their or his opinion the balance sheet referred to in the report is a full and fair balance sheet, properly drawn up, so as to exhibit a correct view of the state of the corporation's affairs as shown by the books of the corporation, and such report shall be read before the corporation in general meeting.

The remuneration of the auditor or auditors shall be fixed by the general meeting appointing such auditor or auditors.

Sec. 3330. Balance sheet. Every balance sheet submitted to the annual or other meeting of the members of the corporation shall be signed by the auditor or auditors and by the president, secretary or manager (if any) and by the directors of the corporation or three of such directors at the least.

General Powers.

Sec. 3331. Powers. Every corporation formed under the provisions of this chapter shall in addition to the powers conferred upon bodies corporate by the provisions of chapter 181 have the following powers, subject to all the restrictions and provisions in this chapter contained, to carry on the business of a bank of discount and deposit in this Territory, to maintain branch banks for the purpose of carrying on said business of banking at such places in this Territory as the corporation may decide, the taxation district of Honolulu excepted, upon payment of a license fee as required by law, and to make loans of money on cash credit accounts, promissory notes, bills of exchange or letters of credit and other securities of the like nature. And it shall also be lawful for the corporation to deal in money, bullion, specie, precious metal and exchanges of and with all countries and in notes, bills or other securities for money and generally to transact all such other business as is or shall or may at any time hereafter be usual or lawful for establishments carrying on banking in all its branches, except as a bank of issue, to do or transact, also to take security by hypothecation of bills of lading for the payment of any bill

or bills of exchange, drawn against any shipment of any description of produce, bullion, or merchandise shipped for exportation to foreign ports or from foreign ports to any port in this Territory or from one port to another in this Territory. Also to make any advances of money to the proprietors of any sugar mill or sugar or rice plantation on condition of receiving in payment as security only for such money the crops of sugar and other produce of such proprietors, and also to acquire, own and hold such real estate as may be requisite for the convenient transaction of its business or for purposes of investment, not exceeding in value in all, as acquired from time to time, twelve and one-half per centum of the amount of its capital stock, exclusive of such real estate as may be required for the convenient use of such bank as and for the situs or place upon which its banking business shall be conducted; and further, to accept and take such real estate as may be mortgaged to it in good faith by way of security or which may be purchased by it in satisfaction of debts previously contracted, or under sales made under judgments, decrees or mortgages held by it, or to secure debts to it. Provided, that all real estate, except the banking premises, acquired or held in excess of said twelve and one-half per centum of the amount of its capital, whether under foreclosure of mortgage or by sale or purchase to secure any debts, or otherwise, shall be disposed of within five years after the same shall have been so acquired. It may hold and dispose of every kind of personal property, chattels, wares and merchandise, franchises or incorporeal rights and easements which it may have taken in good faith as security in the ordinary course of its business as the interest of the corporation may require. The corporation shall not undertake or be employed in any commercial, agricultural, manufacturing or common carrier business; and its right to hold and dispose of property acquired from securities or in payment of debts shall not be construed to authorize the bank to undertake, engage in or carry on any such business as last above mentioned.

Sec. 3332. Collateral security and purchase of shares, limitations. No corporation formed under this chapter shall take as security for any loan or discount a lien upon any part of its own capital stock and no such corporation shall be the purchaser of any part of its own capital stock nor of the capital

stock of any other corporation formed under this chapter or of any incorporated company or partnership firm, unless such purchase shall be necessary to prevent loss from a debt previously contracted in good faith, or unless in case of the forfeiture of stock for non-payment of instalments due thereon; and all stock thus purchased or acquired shall be disposed of again within six months from the date of purchase or acquisition, if such disposition can be made without loss, but in any event to be disposed of as soon thereafter as practicable without loss; provided, however, that any corporation formed under this chapter may acquire and hold a majority or any number of the shares of the capital stock of a corporation owning no other property than the situs or place and building upon or in which its banking business shall be conducted.

Sec. 3333. Limit of indebtedness. No corporation formed' under this chapter shall at any time be indebted or in any way liable to an amount exceeding the amount of its capital stock at such time actually paid in and remaining undiminished by losses, or otherwise, except on the following accounts, viz.:

First. On account of moneys deposited with or collected by such corporation.

Second. On account of bills of exchange or drafts drawn against money actually on deposit to the credit of such corporation, or due thereto.

Third. On account of liabilities to its stockholders for money paid in on the capital stock or for dividends and reserved profits.

Directors.

Sec. 3334. Number, qualifications, election, removal, powers. The affairs of every corporation formed under this chapter shall be managed by not less than five nor more than eleven directors, subject to the provisions herein contained. It shall be lawful for the corporation to prescribe by its articles of association the qualifications of directors, the time and method of their election, and the term for which they shall hold office, and to define their powers and authorities, to provide for their removal from office, the filling of vacancies, and all other matters in connection with their office, and with the management of the business of the corporation; provided, that the directors elected or appointed shall be residents of the Territory of Hawaii.

Sec. 3335. Oath, contents and where filed. No person shall serve as a director who does not own in his own right at least ten shares of the capital stock of said corporation; nor unless when appointed or elected he shall take an oath that he will, so far as the duty devolves on him, diligently and honestly administer the affairs of such corporation, and will not knowingly violate or willingly permit to be violated any of the provisions of this chapter, and that he is the owner in good faith of the number of shares of stock required by this chapter standing in his name on the books of the corporation, or subscribed by him, and that the same is not in any way hypothecated or pledged as security for any loan or debt. Such oath subscribed by the person taking it and certified by the officer before whom it is taken shall be filed in the office of the treasurer.

Dissolution.

Sec. 3336. Procedure. If for any reason any corporation formed under this chapter desires to disincorporate and wind up its affairs, it shall present a petition to the treasurer, together with a certificate setting forth that at a meeting of its stockholders, called for that purpose, it was decided by a vote of three-fourths or more of the stockholders to dissolve the corporation, which certificate shall be signed by the presiding officer and secretary of such meeting. The treasurer shall enter such petition and certificate of record in his office, and after thirty days' notice by publication in Hawaiian and English, in two newspapers published in Honolulu, shall proceed to consider the same, and if satisfied that the vote certified has been duly taken and that all debts due by the said corporation have been paid and discharged, he shall declare the corporation dissolved.

Sec. 3337. Trustees, after dissolution. Unless other persons are appointed by some court of competent jurisdiction in pursuance of due process of law, the directors of the corporation at the time of the dissolution shall continue to act as trustees of the stockholders and shall have full power to settle and wind up the affairs of the corporation and distribute the proceeds among the stockholders pro rata.

Sec.

3338.

CHAPTER 183.

INSURANCE COMPANIES.

Insurance Commissioner.

Commissioner, qualifications, forms. There shall be a department charged with the execution of the laws relating to insurance, to be known as the insurance department, the chief officer of which shall be the Territorial treasurer, who shall be ex-officio insurance commissioner. Neither the insurance commissioner nor any of his deputies or clerks shall be directly or indirectly interested in any insurance corporation or insurance business except as a policy holder. All necessary forms, circulars and blanks, together with such pamphlet copies of the insurance laws as may be required for distribution to any person at any time by the provisions of this chapter, shall be furnished at the expense of the Territory.

Sec. 3339. Deputy commissioner. The insurance commissioner shall appoint a deputy, and in the absence of the commissioner or his inability from any cause to exercise the powers and discharge the duties of his office, the powers and duties of the office shall devolve on the deputy.

Sec. 3340. Report to legislature. The commissioner shall transmit to each legislature at the beginning of its regular session, or within ten days thereafter, a report containing a summary of the statements and reports made to him pursuant to the provisions of this chapter, classified, which report shall also contain:

First. A statement of all the insurance companies or corporations authorized to do business in this Territory during the biennial period ending the thirty-first day of December next preceding, with their names, locations, capital stock, paid-up capital, dates of organization and of the commencement of business in this Territory, and kinds of insurance in which they are engaged respectively.

Second. The receipts and disbursements of the insurance department during the same period.

Third. Any amendments to the insurance law which, in his judgment, are demanded for the better protection of the insured and the people.

Sec. 3341. Powers and duties. The commissioner shall see that all laws of this Territory respecting insurance companies