Bank to let Hawaiian replace it as trustee
By Jim Dooley
Advertiser Staff Writer
In what is being called a "historic event" in promoting Native Hawaiian economic self-reliance, First Hawaiian Bank is withdrawing after 65 years as trustee of the $320 million Queen Lili'uokalani Trust in favor of an as-yet-unselected trustee of Hawaiian ancestry.
"We believe this is a promising era for Native Hawaiians, and we understand their desire to participate fully in managing their inheritance and charting their future," said Walter Dods, chairman of the board and chief executive officer of First Hawaiian Bank. "We therefore have concluded that First Hawaiian Bank should step aside as trustee so that another Hawaiian leader can participate with you in managing the queen's legacy as trustee."
The remaining two trustees, Thomas Kaulukukui Jr., a retired state circuit judge, and David Peters, a former aide to U.S. Sen. Dan Inouye, are both Native Hawaiians.
Peters, chairman of the board of trustees, said yesterday that he and Kaulukukui will nominate a replacement trustee for approval by state Probate Court, probably this spring.
The trust was established in 1917 — the year of Queen Lili'uokalani's death — for the benefit of children of Native Hawaiian ancestry. It operates Queen Lili'uokalani Children's Centers throughout the state, benefiting about 5,000 poor and orphaned children. The trust employs 182 staff members and maintains 11 offices statewide.
The trust's largest single asset is land — 6,294 acres on the Big Island, mostly in the Kona area. It also owns valuable parcels in Waikiki — the land under Marriott Waikiki Beach, Pacific Beach and Radisson Prince Kuhio Hotels — as well as elsewhere on O'ahu.
Peters said each of the three trustees was paid $150,000 last year — more than the $100,000 that trustees of the massive Kamehameha Schools now receive under a revamped pay scale approved by both the Internal Revenue Service and state probate court. The Queen Lili'uokalani Trust is the second-largest ali'i trust behind Kamehameha Schools, formerly known as Bishop Estate.
First Hawaiian Bank, along with one of its corporate predecessors, Cooke Trust Co., has been serving as corporate trustee of the Queen Lili'uokalani Trust since 1937.
In addition to the $150,000 annual trustee fee, First Hawaiian Bank collects a management fee from the trust. The fee was $132,000 in 1998, the latest figure available. The bank will remain as asset manager at least through November.
Trustee Peters lauded the bank's long service to the trust and called its decision to give up its trusteeship "a very important event."
"To our knowledge, it is the first time a Hawai'i corporation has so clearly demonstrated its commitment to developing and supporting Hawaiian leadership in Hawai'i in these modern times," Peters said.
The state attorney general's office oversees the trust. Deputy Attorney General Cynthia Johiro, to whom the office recently assigned responsibility for trusts, said yesterday she was not aware of First Hawaiian's decision to withdraw as trustee and could not comment.
Reach Jim Dooley at jdooley@honoluluadvertiser.com or 535-2447.
Correction: The Queen Lili‘uokalani Trust owns the land under Marriott Waikiki Beach, Pacific Beach and Radisson Prince Kuhio Hotels. A previous version of this story gave incorrect information.
