CPB Inc., which is pushing forward with an unsolicited $285 million cash-and-stock offer for rival CB Bancshares Inc., reported today that earnings rose 14 percent in the first quarter from a year ago. CPB net up 14%
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Bank mergers common hereBy Dave Segal
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The parent of Central Pacific Bank said net income increased to $8.6 million, or 52 cents a share, from $7.5 million, or 47 cents a share, in the first quarter of 2002. CPB cited core deposit growth, operating efficiencies and its asset quality for the improved performance.
CPB, which said it has been unsuccessful in its attempts to discuss a deal with City Bank's management, said a merger would be double-digit accretive to earnings per share in 2004 after the transaction closes. CPB also said it would take a one-time restructuring charge of about $32 million in connection with the merger.
In the interim, though, CPB said it is lowering guidance on earnings per share growth for 2003 to the 6 to 10 percent range from its January forecast of 10 to 12 percent growth. Clint Arnoldus, chairman, president and chief executive officer of CPB, said uncertainty in Hawaii's tourism industry will restrain near-term economic activity within the state.
CPB said total assets at the end of March rose 9 percent to $2.03 billion from $1.86 billion a year ago. Total deposits gained 12 percent to $1.65 billion from $1.48 billion. And total loans increased 5 percent to $1.34 billion from $1.27 billion.
"We have a strong sales discipline in the bank," Arnoldus said. "Coupled with a very stringent credit philosophy, we're able to grow our bank as our quality numbers continue to improve."
CPB's return on equity, which measures how well it used reinvested earnings to generate additional earnings, fell to 19.18 percent from 19.89 percent a year ago; while its efficiency ratio, which measures in percentages how much it costs the bank to make a dollar of revenue, improved to 50.07 percent from $52.48 percent.
Central Pacific Bank