Net up at
Hawaii’s big 2 banks

First Hawaiian Inc. and
Bank of Hawaii's parent both were
helped by mainland operations

By Rick Daysog
Star-Bulletin

Hawaii's two largest financial institutions reported a steady rise in their third-quarter earnings thanks in part to their mainland diversification strategies.

First Hawaiian Inc. today said it earned $21.4 million during the three months ending Sept. 30, up 12.4 percent from third quarter 1996's $19 million. On a per-share basis, the parent of First Hawaiian Bank and Portland's Pacific One Bank, said its third quarter net increased 11.7 percent to 67 cents from the year-earlier's 60 cents.

Pacific Century Financial Corp., parent of Bank of Hawaii, said it earned $35.3 million during the lastest third quarter, up 12.5 percent from the year-earlier's $31.3 million. The company's third-quarter earnings per share grew 13.2 percent to 86 cents from 76 cents in the same period last year.

For the first nine months, First Hawaiian's net increased to $64.1 million, or $2.02 per share, from $59.9 million, or $1.92 per share. Pacific Century's year-to-date income was $106.3 million, or $2.63 per share, up from $98.7 million, or $2.39 per share.

First Hawaiian stock dropped $1.25 to $41.25 in midday trading on the Nasdaq market. Pacific Century shares rose 12.5 cents to $53.933/4 on the New York Stock Exchange by midday.

Both companies cited their new mainland subsidiaries for their earnings growth. Pacific Century said that its purchase of CU Bancorp in July lifted its total assets by $776 million and its loans by $442 million.

First Hawaiian said it is adding three new Oregon branches to its 34-branch Pacific One subsidiary and noted that its mainland car loan business has increased its market share in the Pacific Northwest and in Southern California.

First Hawaiian said that its higher third-quarter net also was due to a one-time charge that the bank holding company took in the year-earlier period deposits in its thrift unit. Without the charge, First Hawaiian's earnings would have been flat, the company said.

At the end of the quarter, First Hawaiian listed assets of $7.9 billion, down 3.2 percent from the year-earlier's $8.2 billion. The company had loans of about $6 billion, up from $5.8 billion last year while its deposits were virtually flat at about $6 billion.

Pacific Century said its assets grew 7.9 percent during the latest quarter to $14.9 billion from $13.8 billion while its deposits and other securities were up 12.6 percent to $11.7 billion from last year's $10.4 billion.

The company's net loans were up 9.7 percent to about $9.2 billion from $8.3 billion.