Advertisement - Click to support our sponsors.
Changing Hawaii
IN 1989, when Lawrence M. Johnson was appointed president of Bancorp Hawaii, parent company of Bank of Hawaii, it was big news in the state's financial circles. Rise and fall of
a bank presidentJohnson was a bona fide "local boy" success story, following two distinguished but mainland-bred predecessors at Bankoh -- H. Howard Stephenson and Frank Manaut.
While both were pillars of the isle banking community, they weren't born in Kalihi like Johnson was. Nor did they get their start at the state's largest bank in the same manner.
"Larry Johnson isn't embarrassed about how -- and why -- he got his first job at Bank of Hawaii in the 1950s," wrote Lucy Jokiel in an April 1989 article in Hawaii Business magazine. "Thirty years ago, he admits to being extremely puzzled when he and four other Punahou classmates were selected as the first group of trainees in the bank's new summer employment program.
" 'We were all good in sports but none of us was exceptional scholastically,' remembers Johnson. The reason became apparent on their first day on the job, when the five young men were issued uniforms for the bank's softball team.
"That summer, and in part due to the efforts of first baseman Johnson, Bankoh handily won the championship title of the Financial Softball League."
Johnson, the jocular jock, worked at the bank for the next four summers. In 1963, on earning his business degree from the University of Hawaii, he became a full-time $500-a-month teller at Bankoh's Kaimuki branch.
Thus began Johnson's phenomenally quick climb up the corporate ladder. In 1970, when Johnson became the youngest vice president in company history, he was jokingly presented a box of diapers by then-Chairman Clif Terry.
Larry was the golden boy whom everybody liked and knew. "We're in great shape financially right now and have tremendous momentum going," Johnson said back in 1989. "So I don't plan on changing things drastically."
But plans do change, and so do fortunes. In the 1990s, Johnson became chairman and CEO, and he and second-in-command Richard Dahl expanded Bankoh into the seemingly safe Asia and Pacific markets. Bancorp Hawaii was rechristened Pacific Century Financial Corp.
The new direction seemed promising, especially to a supportive board of directors. Unfortunately, nobody on the governing body happened to own a crystal ball.
HOW could the brain trust know that, after buying banks and doling out money in the Asia-Pacific region, economies there would crash, resulting in an increase in Pacific Century's nonperforming loans and losses?
The price of the once-stalwart stock plummeted and hasn't recovered, despite a massive restructuring last September which slashed the current 4,400-person work force by 1,015 positions.
Finally, last Monday, an exhausted Johnson announced his resignation after 42 years at Bank of Hawaii -- citing his inability to increase the value of the company for stockholders. The search is on for a successor.
But before Johnson, 59, disappears into local banking lore, he deserves a public commendation for 1) trying his best, 2) giving back to the community via Bank of Hawaii's generous corporate donations and 3) taking sole blame for this company downturn when others -- both above and below him -- have a share of the responsibility.
Local boy Larry Johnson may not be golden anymore, but he's still got a lot of class.
Diane Yukihiro Chang's column runs Monday and Friday.
She can be reached by phone at 525-8607, via e-mail at
dchang@starbulletin.com, or by fax at 523-7863.