to cut 1,015 jobs
Pacific Century says less thanBy Rob Perez
266 workers may be laid off
during the next 12 months
One of the state's largest employers today announced it would eliminate 20 percent of its jobs, or 1,015 positions, a move that could send reverberations through Hawaii's already shaky economy.
Pacific Century Financial Corp., parent of Bank of Hawaii, today announced the job reductions as part of a major restructuring designed to make the company more efficient and competitive.
Although 1,015 positions will be eliminated, the company said it expects fewer than 266 people will be laid off as a result, largely because of a hiring freeze that is continuing, voluntary resignations, projected attrition and staff retraining and reassignments.
As part of the restructuring, called New Era Redesign, the company also said it will dramatically improve its delivery of financial services in Hawaii and across the Pacific.
It said, for instance, that the bank will improve its Internet and phone banking offerings and open new business banking centers.
Once the changes are fully in place by the fourth quarter of 2000, they are expected to conservatively generate $21 million a year in new revenue and save the bank holding company $43 million annually in operating expenses, Pacific Century said.
The company also said its board has authorized a share repurchase program of up to 300,000 shares of common stock per quarter beginning in the fourth quarter of this year. Such moves generally are designed to boost the value of the remaining stock held by outside shareholders.
The moves come as the financial services sector has become increasingly competitive, forcing Bankoh to rethink the way it does business. The company also is trying to placate shareholders who have been disappointed in the stock's performance for much of the 1990s.
By a variety of measures, Pacific Century in recent years has lagged the industry, partly because of the sluggish economy in the company's main market, Hawaii.
To help counter that trend, Pacific Century has acquired companies outside Hawaii to diversify and grow its revenue base -- a move applauded by analysts.
The bank holding company last year eliminated 300 positions and closed 27 branches, but it said only 14 employees actually were laid off. Most of the affected workers found positions elsewhere in the company, retired or quit.