Exhibit 10.1

UNITED STATES OF AMERICA

Before The

OFFICE OF THRIFT SUPERVISION

 

In the Matter of    )    Order No.: WE-08-002    )   
AMERICAN SAVINGS BANK, F.S.B.,    )    Effective Date: January 23, 2008
Honolulu, Hawaii.    )       )    OTS Docket No.: 08384    )       )   

STIPULATION AND CONSENT TO ISSUANCE OF AN

ORDER TO CEASE AND DESIST FOR AFFIRMATIVE RELIEF

WHEREAS, the Office of Thrift Supervision (OTS), based upon information derived
from the exercise of its regulatory responsibilities, is of the opinion that
grounds exist to initiate an administrative cease and desist proceeding for
affirmative relief against American Savings Bank, F.S.B., Honolulu, Hawaii, OTS
Docket No. 08384 (Institution), pursuant to 12 U.S.C. § 1818(b);

WHEREAS, the Institution desires to cooperate with the OTS and to avoid the time
and expense of such administrative proceeding; and

WHEREAS, the Institution enters into this Stipulation and Consent to the
Issuance of an Order to Cease and Desist for Affirmative Relief (Stipulation)
without admitting or denying that grounds exist to initiate an administrative
cease and desist proceeding but admitting the statements and conclusions in
Paragraph 1 below, concerning jurisdiction; hereby stipulates and agrees to the
following:

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1. Jurisdiction.

(a) The Institution is a “savings association” within the meaning of 12 U.S.C. §
1813(b) and 12 U.S.C. § 1462(4). Accordingly, the Institution is an “insured
depository institution” as that term is defined in 12 U.S.C. § 1813(c);

(b) Pursuant to 12 U.S.C. § 1813(q), the Director of the OTS is the “appropriate
Federal banking agency” with jurisdiction to maintain an administrative cease
and desist proceeding against such a savings association. Therefore, the
Institution is subject to the jurisdiction of the OTS to initiate and maintain a
cease and desist proceeding against it pursuant to 12 U.S.C. § 1818(b); and

(c) The Director of the OTS has delegated to the Regional Director of the West
Region of the OTS (Regional Director) the authority to issue cease and desist
orders where the savings association has consented to the issuance of the
orders.

2. OTS Findings of Fact. The OTS has found that the Institution has failed to
comply fully with the requirements of the Currency and Foreign Transactions
Reporting Act (the Bank Secrecy Act or BSA), 31 U.S.C. § 5311 et seq.; the
related BSA regulations issued by the United States Department of the Treasury,
31 C.F.R. Part 103 and the OTS, 12 C.F.R. § 563.177; and the OTS regulations
governing suspicious activity reports (SAR) set forth in 12 C.F. R. § 563.180.

In addition, the OTS has determined that the Institution has failed to comply
fully with certain consumer affairs and compliance laws and regulations,
including specifically those related to the Truth in Lending Act, 15 U.S.C.
§1601 et seq., 12 C.F.R. Part 226 (Regulation Z); the Real Estate Settlement
Procedures Act, 12 U.S.C. §2601 et seq., 24 C.F. R. Part 3500 (Regulation X);
the Flood Disaster Protection Act, 42 U.S.C. 4001 et seq., 12

 

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C.F.R. Part 572; and the Home Mortgage Disclosure Act, 12 U.S.C. §2801 et seq.,
12 C.F.R. Part 203 (Regulation C).

The Institution has begun taking corrective actions to address the deficiencies
found by the OTS.

3. Consent. The Institution consents to the issuance by the OTS of the
accompanying Consent Order to Cease and Desist for Affirmative Relief (Order).
The Institution further agrees to comply with the terms of the Order upon
issuance and stipulates that the Order complies with all requirements of law.

4. Finality. The Order is issued under 12 U.S.C. § 1818(b) and upon its
effective date shall be a final order, effective and fully enforceable by the
OTS under 12 U.S.C. § 1818(i).

5. Waivers. The Institution waives the following:

(a) The right to be served with a written notice of the OTS’s charges provided
by 12 U.S.C. § 1818(b) and 12 C.F.R. Part 509;

(b) The right to an administrative hearing of the OTS’s charges against it as
provided by 12 U.S.C. § 1818(b), 12 C.F.R. Part 509;

(c) The right to seek judicial review of the Order including, without
limitation, any such right provided by 12 U.S.C. § 1818(h), or otherwise to
challenge the validity of the Order; and

(d) Any and all claims against the OTS, including its employees and agents, and
any other governmental entity for the award of fees, costs, or expenses related
to this OTS enforcement matter whether arising under common law, federal
statute, or otherwise.

 

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6. OTS Authority Not Affected. Nothing in this Stipulation or accompanying Order
shall inhibit, estop, bar, or otherwise prevent the OTS from taking any other
action affecting the Institution if at any time OTS deems it appropriate to do
so to fulfill the responsibilities placed upon OTS by law.

7. Other Government Actions Not Affected. Institution acknowledges and agrees
that its consent to the issuance of the Order does not release, discharge,
compromise, settle, dismiss, resolve, or in any way affect any actions, charges
against, or liability of the Institution that arise pursuant to this action or
otherwise, and that may be or have been brought by any other government entity
other than the OTS.

8. Miscellaneous.

(a) The laws of the United States of America shall govern the construction and
validity of this Stipulation and of the Order;

(b) All references to OTS in this Stipulation and the Order shall also mean any
of the OTS’s predecessors, successors, and assignees;

(c) The section and paragraph headings in this Stipulation and the Order are for
convenience only, and such headings shall not affect the interpretation of this
Stipulation or the Order;

(d) The terms of this Stipulation and the Order represent the final agreement of
the parties with respect to the subject matters hereof and constitute the sole
agreement of the parties with respect to such subject matters; and

(e) This Stipulation and the Order shall remain in effect until terminated,
modified, or suspended in writing by the OTS, acting through its Director,
Senior Deputy Director, Regional Director, or other authorized representative.

 

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9. Signature of Directors.

Each Director signing this Stipulation attests that he or she voted in favor of
a Board Resolution authorizing the consent of the Institution to the issuance of
the Order and the execution of the Stipulation.

WHEREFORE, the Institution, by a majority of its directors, executes this
Stipulation and Consent to the Issuance of an Order to Cease and Desist for
Affirmative Relief intending to be legally bound hereby.

 

American Savings Bank, F.S.B.     Office of Thrift Supervision   Honolulu,
Hawaii     West Region   Accepted by a majority of its directors:     By:  

/s/ Darrel W. Dochow

          Darrel W. Dochow   By:         Regional Director, West  

/s/ Kenton T. Eldridge

      Dated: January 23, 2008   Director        

/s/ Diane J. Plotts

        Director        

/s/ Don E. Carroll

        Director        

/s/ Bert A. Kobayashi

        Director        

/s/ Jeffrey N. Watanabe

        Director        

/s/ Constance H. Lau

        Director        

/s/ Richard W. Gushman, II

        Director        

/s/ Shirley J. Daniel

        Director        

/s/ Louise K. Y. Ing

        Director        

/s/ Victor H. Li

        Director        

/s/ Jorge G. Camara, M.D.

        Director        

/s/ Barry K. Taniguchi

        Director        

 

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