Hawaii Administrative Rules
Title 16 - DEPARTMENT OF COMMERCE AND CONSUMER AFFAIRS
Chapter 26 - EXAMINATION AND OFF-SITE MONITORING OF HAWAII FINANCIAL INSTITUTIONS
Subchapter 1 - GENERAL PROVISIONS
Section 16-26-7 - Uniform financial institutions rating system

Universal Citation: HI Admin Rules 16-26-7

Current through August, 2024

(a) The division adopts the "Uniform Financial Institutions Rating System" (UFIRS), which was issued and recommended by the Federal Financial Institutions Examination Council. The rating system reflects in a comprehensive and uniform fashion an institution's financial condition, compliance with laws and regulations, and overall operating soundness. Its primary purpose is to help identify those institutions whose financial, operating, or compliance weaknesses require special supervisory attention or warrant a higher than normal degree of supervisory concern.

(b) The uniform rating of institutions will ensure that:

(1) The degree of supervisory attention and the type of supervisory response are based upon the severity and nature of an institution's problems;

(2) Supervisory attention and action are, to the extent possible, administered uniformly and consistently, regardless of the type of institution or the identity of the regulatory agency; and

(3) Appropriate supervisory action is taken to address those institutions whose problems entail the greatest potential for hardship or inconvenience to depositors, borrowers, or the public; or those institutions whose potential weaknesses would most seriously disrupt the proper and efficient functioning of the financial system.

(c) In accordance with the UFIRS, each institution shall be assigned a uniform composite rating based on an evaluation of pertinent financial and operational standards, criteria, and principles. This overall rating is expressed through use of a numerical scale of "1" through "5" in ascending order of supervisory concern. Thus, "1" represents the highest rating and, consequently, the lowest level of supervisory concern; "5" represents the lowest rating and, therefore, the highest degree of supervisory concern. The uniform composite rating and individual component ratings shall be contained in the report of examination and shall be deemed confidential, pursuant to section 412:2-104, HRS.

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