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American Express
gets Bankoh
credit cards

The bank will turn over
the card accounts in the first
or second quarter of 2001

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By Russ Lynch
Star-Bulletin

Bank of Hawaii said today it will turn over its credit card business to American Express Co. next year, and holders of the isle bank's 148,000 consumer and business credit card accounts will receive Bank of Hawaii-branded American Express cards to replace their Bank of Hawaii cards.

They will continue as credit cards, with holders still having the option of paying them all off each month or paying monthly installments, the bank said. The accounts currently have a total of $229 million billed on them.

The business should be turned over to the mainland company in the first or second quarter of 2001, depending on regulatory approvals, the bank said. Financial details of the transaction were not disclosed, but Bank of Hawaii said it will get a premium from the business that American Express does with the cards.

Michael E. O'Neill, chairman and chief executive of the bank and its parent, Pacific Century Financial Corp., said American Express has "an unparalleled reputation in the credit card industry," and Bank of Hawaii's card customers will be introduced to "the power of a world-class brand."

American Express will get to market its services to the Hawaii customers, the companies said in a joint statement.

"This is the first agreement we have reached with a bank to acquire a card portfolio and to market to their bank customers," said Alfred F. Kelly Jr., group president of U.S. consumer and small-business services at New York-headquartered American Express.

He said American Express hopes to do something similar with smaller banks across the country.

Bank of Hawaii said the transition should be smooth.

"Every effort is being made to ensure that the conversion process is seamless to customers, and we don't expect they will be materially impacted by the change," said Alton Kuioka, the bank's vice chairman.

The cards will he handled by an American Express subsidiary, American Express Centurion Bank.

The change will result in no loss of jobs in Hawaii, said a Bank of Hawaii spokesman, Stafford Kiguchi. He said there are only 12 employees in the credit card program, eight in Hawaii and four on the mainland. The Hawaii workers will be retained, and the mainland workers will be assisted in finding new positions, Kiguchi said.

The switch involved only Bank of Hawaii's credit cards, not the debit cards held by checking and savings customers, he said.

First Hawaiian Bank said it continues to own its own credit card program.