The twelvefold jump in profits
for the Bankoh parent was skewed by
a special charge in the year-
By Russ Lynch
Bank of Hawaii parent Pacific Century Financial Corp. had a net profit of $38.5 million, or 47 cents a share, in the quarter ending June 30, more than 12 times the profit of $3.1 million, or 4 cents a share, reported for 1998's second quarter.
Much of the difference was due to special charges in the 1998 quarter -- a $19.4 million restructuring charge and $42 million set aside for nonperforming loans, compared with no restructuring charge and $14 million set aside for nonperforming loans in the 1999 quarter.
Nevertheless, some aspects of the bank-holding company's basic business improved.
While net interest income was down by $2.5 million at $144.4 million in the latest quarter compared with $146.9 million, income from fees and service charges was up $3.9 million at $22.6 million compared with $18.7 million in the 1998 quarter.
The company also reported gains in income from managing trusts and a higher return on its securities investments.
The per-share results beat by 2 cents the average estimate of 45 cents from nine Wall Street analysts who follow the company. Pacific Century's stock rose 12 cents to close at $21.19 today on the New York Stock Exchange.
"This quarter's earnings represent one of the highest in the company's history," Lawrence M. Johnson, chairman and chief executive, said in a statement announcing the quarterly report. "These results reflect our continuing efforts to make the balance sheet more efficient, control noninterest expense and improve asset quality."
At the end of June, the company had assets of $14.6 billion, down 0.7 percent from $14.7 billion a year earlier.
Deposits totaled $9.3 billion, down 2.1 percent from $9.5 billion at the end of June 1998; loans of $9.2 billion were up 0.1 percent from $9.1 billion.
Besides Bank of Hawaii, Pacific Century is also the parent of Pacific Century Bank on the mainland and other financial businesses in Hawaii, the mainland, the Pacific and Asia.