City Bank
parent’s
net doublesCB Bancshares has spent
$6.2 million attempting to
ward off a hostile takeover
from Central Pacific
Mortgage activity boosted the net income of City Bank's parent company 103.7 percent in the third quarter, despite a $1.9 million expense to fend off an unwanted takeover attempt by the parent of Central Pacific Bank.
The net income of CB Bancshares Inc., rose to $5.5 million from $2.7 million in the same period last year. Without factoring in the takeover-related expenses this year and a $951,000 after-tax impairment write-down last year, the publicly held company's adjusted net income rose 86.7 percent to $6.9 million from $3.7 million.
Per-share income jumped 101.6 percent to $1.25 from 62 cents last year.
The parent of City Bank, Hawaii's fifth-largest bank, has spent $6.15 million this year to rebuff the advances of Central Pacific Bank, the state's fourth-largest bank. The banks are now in a legal battle.
"Our efforts to improve asset quality, while simultaneously growing core deposits and fee income, have been a critical element in our strong third-quarter results," said Ronald K. Migita, CB Bancshares' president and chief executive. "In addition, the California lending and Hawaii mortgage banking operations have continued to be important elements of growth."
As of Sept. 30, the company had $1.84 billion in assets, up 16 percent from $1.59 billion last year, including $1.25 billion in loans, up from $1.12 billion last year. City Bank has 22 branches statewide.
Net interest income, the difference between interest income and interest expense, increased 27 percent to $19.3 million from $15.2 million last year, after a provision for credit losses.
The company decreased its provision for credit losses in the third quarter to $1.2 million from $4 million last year, reflecting improvement in Hawaii's economy and the bank's asset quality.
Noninterest income was up 212.5 percent to $5 million from $1.6 million last year, because of $800,000 in net gains on the sale of securities in the third quarter.
Nonperforming loans were down 27 percent to $11.1 million from $15.3 million last year, and represented 0.89 percent of total assets, compared with 1.36 percent of assets last year.
CB Bancshares announced its earnings after the close of trading yesterday, and its stock, traded on the Nasdaq, was unchanged at $62. The stock has remained near a 52-week high since the hostile takeover attempt was disclosed in mid-April.
