BancWest earnings
increase 12 percentFirst Hawaiian Bank's parent
caps off its fifth straight record year
BancWest Corp., benefiting from strong growth in consumer lending and a reduction in nonperforming assets, posted a 12 percent increase in net income in the fourth quarter to end 2003 with its fifth straight record year.
The Honolulu-based company, comprised of First Hawaiian Bank and Bank of the West, had earnings of $114.6 million in the fourth quarter compared with $102.3 million a year ago. For the full year, BancWest had net income of $436.6 million, up 20.8 percent from $361.3 million in 2002. The company's full-year 2002 net income was revised upward by $3.7 million, or about 1 percent, last April due to a technical accounting change.
"(The record earnings year was) achieved through continued organic growth at Bank of the West and First Hawaiian Bank, and a full-year's earnings contribution from the 2002 acquisition of United California Bank," said Walter A. Dods Jr., BancWest's chairman and chief executive officer.
BancWest, which acquired United California on March 15, 2002, grew its assets 10.4 percent to $38.4 billion from $34.7 billion in 2002. The bank's loans and leases increased 6.5 percent to $25.7 billion from $24.2 billion and deposits rose 7.5 percent to $26.4 billion from $24.6 billion.
"Net income grew steadily each quarter in 2003," Dods said.
BancWest, formed by a merger between First Hawaiian Bank and San Francisco-based Bank of the West in November 1998, no longer provides earnings per share because it is now a subsidiary of BNP Paribas SA. The French banking giant acquired BancWest for $2.4 billion in December 2001.
Credit quality improved in 2003 for BancWest as it reduced its year-end ratio of nonperforming assets to 0.59 percent of loans, leases and foreclosed properties from 0.71 percent at the end of the third quarter and 1.02 percent on Dec. 31, 2002.
BancWest's net interest income, the difference between interest earned on loans and investments minus interest paid on deposits, rose 1 percent to $330.5 million in the fourth quarter from a year ago due to 10.9 percent growth in average earnings assets, such as loans. That was partially offset, though, by a lower net interest margin of 4.18 percent compared with 4.59 percent in the year-ago quarter. In other words, the bank lent more loans than a year ago but received a lower interest margin on those loans.
Noninterest income, which includes revenue from service charges and fees, increased 2.9 percent to $92.3 million in the fourth quarter from a year ago while for the full year it rose 16.5 percent to $387.3 million.
BancWest has 295 Bank of the West branches in California, Oregon, New Mexico, Nevada, Washington and Idaho with 61 First Hawaiian branches in Hawaii, Guam and Saipan.
