Central Pacific BankCPB Inc. announced a new stock repurchase plan today in which it will buy about 600,000 of its shares, or 6.9 percent of the 8.7 million common shares now outstanding.
parent to buy back
The company's stock has
risen 55% since the first
repurchase program was
launched two years ago
By Russ Lynch
It will be the fifth stock repurchase launched by the parent of Central Pacific Bank since 1998.
So far, the company has bought back 1.9 million of the 10.6 million shares it had outstanding when it started the first repurchase.
By the time the new program is completed, it will have about 24 percent fewer shares outstanding than it had when it first started to buy.
Joichi Saito, board chairman and chief executive officer, said the buybacks have enabled the bank to optimize its capital and enhance shareholder value. They also show its confidence in its business, he said.
Companies usually buy back their stock on the open market when they perceive it as undervalued.
CPB's shares fell 19 cents to $24.94 today on the Nasdaq stock market.
That represented about a 55 percent rise since the first buyback program was launched in September 1998. CPB's stock is down 9.6 percent since the start of the year.
Last September, the company bought 300,000 of its shares from Sumitomo Bank Ltd., leaving the Japanese bank with 1 million CPB shares, at the time equal to 10.4 percent of the Hawaii bank's stock.